New Flight Plan
#Transportation
#Travel
Practice this intermediate profitability case interview question in the Transportation sector. Includes detailed problem prompt, clarifying questions, structured framework, and expert recommendation. Part of ProHub's 835+ consulting case library.
ProHub Comment
This case teaches a sophisticated pricing and segmentation strategy where the airline must simultaneously serve two distinct customer segments with opposite priorities. The key insight is recognizing that price-sensitive vacationers and quality-focused business travelers require fundamentally different value propositions, and that unbundling combined with seasonal strategies can maximize overall profitability rather than pursuing a single-price approach.
Estimated Time
26 minutes
Difficulty
Medium
Source
Queen's
10
/ 100
Your client is an airlines. As you may know, competition is fierce among the major airlines, with ticket prices being driven steadily downward. After a year of weaker than average growth, they have hired our firm to devise a set of strategies for growth. Assume management’s goal is profitable revenue growth, rather than cost cutting.
Clarifying Information
- We charge clients for the price of a seat, including first, business, and economy class as well as the time to fly – all inclusive in one ticket price
- We will get to specifics later, but broadly speaking we serve two types of customers: Vacationers and Business Travelers
- There are over ten competitors in the market, each holding a small share – no dominant player in the market. That said, some flight routes are controlled by only one or two competitors
- The client has not specified a growth target
- The client is more interested in finding ways to increase profit, not any specific number