Ch. 2- Strategic Planning for Competitive Advantage

Delta Air lines, as everyone knows it to be, is one of the largest airline carriers in the world but many of their travelers don’t utilize their amenities that Delta strongly markets and rewards their customers for flying with them. SkyMiles, SkyClubs and Skybonus are three of Delta Airlines subgroups along with their largest SBU, Delta’s Oil refinery.

SkyMiles is a frequent flyer program for Delta Airlines. They are credit cards from American Express that allow the travelers to obtain benefits for flying with them. No foreign transaction fees for customers from American Express when using SkyMiles, also priority boarding, first checked bag free and earning money from purchasing made directly with Delta. Delta has marketed this program as ‘exclusive’ so that their passengers not only maintain long-term commitment for using their airlines and receiving benefits mentioned above. SkyClubs and Skybonus all use the same marketing strategy to maintain loyalty from not only the single passenger but Skybonus for businesses using frequent airline travel and their well known exclusive membership only Delta SkyClub. All three subgroups have some connection to American Express credit cards.

Delta Air Lines most recent move was acquiring an oil refinery that was on the verge of closing permanently. No other airline owns a refinery, in 2012 Delta Air Lines was the first to do something like this in the industry; again proving that Delta is consistently innovative. This idea initially puzzled many experts in the field because of the investment of 100 million to a failing oil refinery. Delta told investors that refinery would help reduce its annual fuel expense by $300 million. Initially, Delta’s critics were right, Monroe Energy (Deltas subsidiary) was failing in 2012. Looking at present day, Delta has yet to meet any of the margins they have hoped for when initially acquiring investors and made a statement in April 2016 that they hope to break even.