Marketing for Boeing - James S. Parker's Personal Website.

Marketing Audit
for Boeing
Marketing Management 586
Spring 2006
James Parker, Kellie Logan, Sally Wencel,
Barry Corum, Jeff Thul
History of the 787 Dreamliner
• Started assembly in 2006.
• Designed due to declining air travel after
the attacks on September 11, 2001.
• Increase fuel costs
The 787’s Features
The 787’s Features
The 787’s Production Process
Boeings new streamlined production process.
The Macroenvironment
• Global population growth in developing
• Increase in average life expectancy in
western civilization.
• Increase of disposable income in
developing countries.
The Macroenvironment
• World Trade Organization (WTO) litigation
between U.S. and Europe
• Response to customer wants and needs
• Energy and material conservation
• Increasing world wide demand for
commercial airlines.
The Macroenvironment
20 Year Market Potential
The Macroenvironment
• Competition
– Airbus Industries of Europe
Formed in 1970
From a Fledgling to a Formidable Opponent
Since 2000 Airbus has been the number 1 in sales
In 2005, achieved a 51% share of global market
• Market, sales, and delivers to end user.
The Macroenvironment
• Differences between Boeing and Airbus
– Airplane size
– Point-to-Point vs. Hub-to-Hub
• “It’s more accurate to say that we have two distinct
views of the market. We believe that airlines
ultimately respond to what passengers want…
more opportunities to fly where they want to go,
when they want to go.”
Randy Basler – VP Marketing
Boeing SWOT Analysis
• Strengths
– Innovation and Technical Expertise
– Strong reputation of quality and industry
– Long-standing customer relationships
– International customer base
– Supplier-Component Manufacturer Networks
– Commercial Aircraft is one of six business
SWOT – Continued
• Weaknesses
– Development Costs for new products: $8-10 Billion
– Reliance on Suppliers-Component Manufacturers
(both strength and weakness)
• Opportunities
– New technologies to build lighter, longer range aircraft
– New airline customers in Asia and Pacific market
– Airline travel pattern changes supporting Boeing
product line
SWOT - Continued
• Threats
– Aggressive Airbus Price Discount Practices
• WTO dispute regarding EU subsidies
– Changing economics
• Domestic airline bankruptcies
– Changing governments, politics and business
partners based in those countries
• Example: Dubai Port management controversy
– Air travel vision could be wrong
Mission Statement
• “The Commercial Airplanes segment is
involved in developing, producing and
marketing commercial jet aircraft and
providing related support services,
principally to the commercial airline
industry worldwide.”
Market Strategy
• Three prong strategy
– Establish international partners in production
– Use light weight materials
– Develop new midsized aircraft
• Sales department overhaul
• What are the results?
Market Strategy Payoff
Confirmed Orders
Marketing Productivity
• Objective: Profitability
• Expects to earn almost 57% of the
revenue for the 787
• Competitor: Airbus’s A350
Marketing Function Audits
Product Line Objective
Program to replace 737
“Derivatives R Us”
Price: 737 lower than A350
Differentiating their product
Marketing Function Audits
Differentiating their product
Central themes of advertising
– Technology
– Cost Effectiveness
International Air Show
Randy’s Journal
Scott Carson