Marketing for Southwest Airline Company Case Study

Marketing for Southwest Airline Company - Case Study Example The main reason for this is the dissatisfaction that the individuals and companies experience from the complex pricing strategy if the airline industry. This is a negative implication for the industry since it results in loss of customers and thereby placing it at a risk of making losses or yielding lower returns for the potential and existing investors. The industry is also at the threat of facing external attacks such as by the terrorists whose impact is negative on the operation of the industry. The attacks result in losses that take a long time to recover. They also result in loss of the significant number of customers as some flights need to be canceled while others still need to be rescheduled. These inconveniences result to traffics experienced by customers which end up inconveniencing many, leading to dissatisfaction in the passengers. This inconvenience also results in many passengers shifting to the competitors of the industries and others substituting air transport to other means of transportation. This as well results in losses that are either irrecoverable or take some time to be recovered. This further ends up lowering returns for the investors both the existing and the potential (Rouse 4). An agreement to Buffet’s assertion is also based on the fact that the airline industry is highly competitive and profitability is highly sensitive to capital and operating cost changes. The industry, therefore, lacks stability in terms of expected profits. This also results from the threat of competitors who tend to set their fares and prices by reviewing the prices set by the industry. This leads to them engaging in an unhealthy competition which is price based. This leads the industry to not being able to determine what it needs to stabilize its profitability.