Running head: AAA AIRLINE: NEW PRODUCT LAUNCH

AAA Airlines: New Product Launch

Latanya Brooks

Pamela Coard

Emanuel Easter

Ashley Harmon

Reginald Walling

MKT/571

Dr. Robin Davis

November 12, 2013

Running head: AAA AIRLINE: NEW PRODUCT LAUNCH

AAA Airline: New Product Launch

Market Needs

The domestic and international airline markets have an enormous demand for an

economy advantage plan that encompasses priority boarding, six additional inches of legroom,

and seating in the first few rows of the economy cabin. There are three million plus people

flying to different states and countries around the world daily. Thousands of aircraft fly

nationwide daily. Passengers are traveling constantly for pleasure, business, or commuting

purposes. Currently, competing airlines offer similar perks, but none of them offer additional

legroom seating on domestic flights. AAA Airlines has an opportunity to offer more spacious

seating, priority boarding, seating in the first few rows of the economy cabin, 50% more recline

as well as free beer, wine, and cocktails for domestic and international flights with more

competitive pricing option.

Market Growth

Because improved efficiencies implemented by airlines, the airline industry has shown

strong growth in the number of passenger trips. Iata has elevated the forecast for airline net post-

tax profits from 10.6 billion to 12.7 billion. With a strong increase in passenger trips and an

increase in airline profits, the implementation of AAA Airlines Economy Advantage Plan will

prove to be a profitable enhancement to the airline.

Strengths

The new airline package has many features that apply to both domestic and international

markets. First, AAA Airlines will provide passengers with a luxury experience even at the
Running head: AAA AIRLINE: NEW PRODUCT LAUNCH

“coach” level. This will be accomplished primarily by providing reclining seats with quality

cushioning typical of other airlines “first-class” amenities. The added space and legroom will

allow passengers to bring larger carry-on bags. These features will provide passengers with a

luxury experience at a more reasonable price.

Weaknesses

AAA Airlines new product launch will also have its inherent weaknesses, such as

customers seeking affordable airfare without the extra incentives. Of course, the economy

advantage plan will require additional fees. AAA Airlines anticipates, travelers flying the

competition to compare AAA’s services to determine the value added services against

competitors. In both cases, these customers are not the primary customer market to be reached.

The possibility of frequent delays because of the amount of carry-on luggage each customer is

permitted could have a negative impact on the product launch. Providing additional legroom will

require less seating which, will mean fewer passengers per flight. This could pose the greatest

weakness to AAA’s economy advantage plan.

Opportunities

A new product, such as ours offers passengers with new opportunities to change the way

they will use airline travel. One opportunity is to provide an additional six inches of leg room for

the first few rows in the economy cabin for domestic and international flights at a more

competitive fare. Select international flights offer 50% comfortable reclining options as well as

free beverages. Our economy advantage plan most essentially provides promotional rewards

(meals, miles, travel points, etc.) to passengers purchasing tickets early.

Running head: AAA AIRLINE: NEW PRODUCT LAUNCH

Threats

Competitors may implement similar economy advantage plans posing the threat of

increased competition.

Competitors

There are many airline services available for passengers to choose from. Southwest

Airline provides similar services, affordable airfare, and added room for carry-on luggage. There

are also new features from American Airlines that extend passengers added legroom and more

comfortable seating. Delta Airlines and American Airlines, two established names in airline

industry also provide many luxuries and amenities to maintain a competitive edge.

Product Offering and Definition

AAA Airlines is proud to announce the new economy advantage program. This feature

allows travelers to enjoy up to six more inches of legroom, Priority Boarding, and seating in the

first few rows of the Economy cabin. On select international flights, the customer can also

experience up to 50% more recline and free beer, wine, and cocktails. AAA is offering a variety

of seating options to budget conscious travelers. To keep in step with the fluid needs of our

consumer base, we have created additional ticketing options on most of our flights. Economy

Advantage may be purchased for the entire flight or by segment, depending on the traveler’s

needs. The chart below outlines options.

Product Identification:
Economy Advantage Comparison by Flight Type
 
Details Economy Advantage Preferred Seats
Type Flights within the All Other AAA Royal English Exit, Bulkhead,
Running head: AAA AIRLINE: NEW PRODUCT LAUNCH

continental United
States and via
Canada, Mexico, Front Cabin Aisle
Flights Airlines
Central America, and Window
and the Caribbean
destinations
90 days to 48
hours prior to
departure:
REA.com only for
seat purchases. Anytime: No
Anytime: AAA Anytime: My additional cost for
When & how to Mobile App, AAA. Trips, Online 48 hours or less Y/B/M fares.
upgrade once Com online Check- Check-in, prior to departure:
ticket is in, Airport Kiosk, Airport Kiosk, AAA channels During Check-in:
purchased and Reservation Reservation including AAA Non-A/B/C fares
Agents. Agents. Mobile App, may purchase
AAA.Com Online Preferred seats.
Check-In, Airport
Kiosk,
Reservation
Agents.
Yes, on AAA
Early Boarding Zone 1 Zone 1 ground-handled Varies by seat type
flights only
Available on
Flights to/from
Canada, Mexico,
Central America,
and the Caribbean.
Complimentary
beer, wine, and Yes Yes No
spirits On Domestic
Routes Only
Available on ATL
Flights to/from
LAX, SEA or
PDX.
Up to six more
Up to six more Up to six more
Legroom inches of Varies by seat type.
inches of legroom inches of legroom
legroom
Recline Up to 50% more Up to 50% more Up to 100% more Varies by seat
recline on the recline recline location
Running head: AAA AIRLINE: NEW PRODUCT LAUNCH

following routes:
ATL to/from SFO
or LAX and JFK
to/from HNL
FREE for
FREE for FREE for
Titanium/
Titanium/ Platinum Titanium/
Platinum Star,
/Gold Star, and A, Platinum Star, and FREE for all Star,
and A, B & C
B & C fares A, B, C fares and A/B fares. C
fares
Discounts for fare Economy
AAA customers 50% OFF for 50% OFF for Class tickets may
50% OFF for
Silver Star or free Gold Star select preferred
Gold Star
for Silver Star seating at Check in.
within the check-in 25% OFF for
25% OFF for
window Silver Star
Silver Star
FREE for
Flying Blue
FREE for Flying Platinum FREE for Flying
Blue Platinum/ Blue Platinum
Gold, and 50% OFF for
AAATeam AAATeam 50% OFF for
FREE for
Ultimate Plus Ultimate Plus, Flying Blue Gold
AAATeam
and REA and AAATeam
Ultimate
Discounts for 50% OFF for Velocity Ultimate Plus
Plus/Ultimate,
other airlines AAATeam Program
Flying Blue
Ultimate, and REA 25% OFF for
Platinum/ Gold
Velocity Platinum 25% OFF for Flying Blue Silver
/Silver
Flying Blue and AAATeam
25% OFF for REA Silver, Ultimate if
Velocity Gold & AAATeam purchased from
Silver Ultimate, and AAA.com
REA Velocity
Gold & Silver

Justification

Flying is an essential form of transportation for the purpose of business and pleasure.

There are millions of travelers taking to the airways daily, traveling thousands of miles.

Affordability, dependability, and comfort are top priority for air travelers. AAA Airlines
Running head: AAA AIRLINE: NEW PRODUCT LAUNCH

implementation of the new economy advantage plan will offer more seating options, priority

boarding, free beverages, and promotional rewards for customers purchasing early tickets. The

goal is to accommodate our customer needs with competitive affordable advantage.

Marketing Survey

1. What is your:

a) Age? _____________

b) Gender? _____________

c) Education? _____________

d) Income level? _______________

2. How often do you fly: (daily, monthly, semi-annually, annually, or once every few

years)

a) Domestically? _____________________

b) Internationally? ____________________

3. Which airline(s) do you typically use for:

a) Domestic travel? _____________________

b) International travel? ____________________

4. Do you need the following in the Economy cabin? (please write yes or no)

a) Luxury seating ___________________

Running head: AAA AIRLINE: NEW PRODUCT LAUNCH

b) Carry-on space on flight ________________

c) Priority boarding ________________

d) Seating in the first few rows of the Economy cabin _________________

e) Free beer, wine and cocktails on international flights ________________

5. How much in extra ticket cost are you willing to pay for:

a) Luxury seating? ___________________

b) Carry-on space on flight? ________________

c) Priority boarding? ________________

d) Seating in the first few rows of the Economy cabin? _________________

e) Free beer, wine and cocktails on international flights? ________________

6. How much in extra ticket cost are you willing to pay for first-class experience in the

Economy cabin? __________________

7. Which factor(s) influence your decision to choose an airline? Check where appropriate:

Rate each on a scale of 1 to 5. (One being the least liking to influence and five being the

most liking)

a) Price ________________

b) Luxury seating _______________

c) Priority boarding _______________

d) Free food and drinks on board ______________

e) Carry-on space on flight _______________

Running head: AAA AIRLINE: NEW PRODUCT LAUNCH

8. How willing are you to fly a new airline for the advantages it advertises? Check where

appropriate:

a) Very willing ______________

b) Not willing _____________

c) Undecided _____________

9. What is your opinion of a classless airline? Check where appropriate:

a) Preferred ______________

b) Careless ______________

c) No opinion ______________

10. Given the option to enjoy first-class experience in the Economy cabin of a new airline,

would you choose to fly another airline to compare the costs and benefits? Check where

appropriate:

a) Yes __________

b) No ___________