Star Alliance by Noelle Hou

Problem Statement

noellehou2527 — 2023-12-05 01:46:36 UTC

Star Alliance has experienced a decline in revenue for several years resulting in the effects of the COVID-19 pandemic, resulting in travel restrictions and economic uncertainty. It is important to develop a strategic solution to increase ticket sales and rebuild customer confidence in safe travel.

Analysis

noellehou2527 — 2023-12-05 02:02:56 UTC

The unpredictable effects of COVID-19, travel restrictions, and the hazardous environment presented difficulties for the Star Alliance. In the last few years have led to a sharp decline in ticket sales with passenger demand falling 54% and is expected to reach a total loss of $84.3 billion for the airline industry in 2020. Star Alliance needs to prioritize rebuilding customers' trust in having a safe flying journey with securing repercussions as a main goal to increase sales and the level of comfort of passengers. Not resolving the issue effectively may decrease ticket sales and alienate customers. Moreover, it benefits Star Alliance in relocating the company's position as a trusted airline for travelers to seek reliable travel support.

Alternative 1- Implement health and safety procedure

noellehou2527 — 2023-12-05 06:38:03 UTC

To create a strict safety and consistent health certification procedure for all of its member airlines, create health and safety protocols each airline must have. Passengers would feel more confident in the alliance's commitment to their well-being if it were certified to uphold the strictest safety regulations and hygienic standards.

Pros 1: Enhance customer's confidence and loyalty

Demonstrates a proactive commitment to the passengers that can significantly enhance their trust and understanding of the priority of airlines.

Pros 2: Positive brand image and public relation

Enhance the company's reputation by placing the customer's well-being first. Contributing to positive brand perception can rebuild customer loyalty.

Cons 1: Operational challenges and cost

Difficult to monitor minor changes and can be complex to execute in each airline. Also requires significant investment and time to keep track of implementation.

Cons 2: Skeptical on maintaining standard implementation

As more companies adopt the same protocol, customers may question the qualities of the implementations.

Alternative 2- Provide flexible booking policies that prioritize customers

noellehou2527 — 2023-12-05 07:12:06 UTC

By providing no-change fee policies for every flight for a two-month timeframe, and enhancing its positive reviews from customers; these services would also reduce concerns about unforeseen trip cancellations and financial risks. By prioritizing the needs of the customer, the alliance can improve its standing and attract more ticket bookings.

Pros 1: Increasing customer satisfaction and loyalty

Allow members to have more flexibility in booking tickets without having additional safety concerns and limitations. It centers customers' needs and establishes experience satisfaction.

Pros 2: Differentiation from competitors and attracting new customers as a marketing strategy

The flexibility policy can be a distinct service that the airline industry provides and is a compelling factor for travelers when choosing airlines. Utilize it as a marketing strategy to attract new customers to join the alliance because of the benefit.

Cons 1: Potential revenue loss

It might impact the financial performance of the company when travelers take too much advantage of no-change fee policies. It will increase the risk of passengers booking without consideration.

Cons 2: Implementation challenges across Star Alliance airline

Managing this policy in all alliance airlines and executing the same regulation requires effective communication and potentially impacts the existing reservation system. This may create a negative impact on customer satisfaction.

Recommendation

noellehou2527 — 2023-12-05 07:12:56 UTC

Alternative 2 of providing flexible policies that prioritize customers' needs will be a better option to rebuild members' brand loyalty and trust in the airlines. Even though implementing no-change fee policies across Star Alliance airlines can potentially create a financial loss and difficulties in their operational system. Limiting the policies for a certain timeframe will enhance the booking purchases from existing and new customers. It can create an immediate increase in sales and utilize the opportunity to rebuild the trust of the airline industry. Even though Alternative 1 focuses on implementing a safety regulation that secures members' well-being and eliminates their concerns. The performance of implementation from each airline may vary and create a biased standard or experience for the travelers.

Implementation

noellehou2527 — 2023-12-05 07:22:11 UTC

Announce a one to two-month frame of executing no-change fee policies as a short-term marketing goal and promote the discount benefits on social media, as it will attract travelers to book upcoming trips with the flexibility of making changes.
Keep track of the impact made on sales for the first two weeks to see the effectiveness of this strategy and make immediate adjustments.
While executing the policies, emphasizing the importance of health and safety is also significant to attract travelers.