Customer Retention Strategies Creating Exceptional Customer Service Essay

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Customer Retention Strategies

Creating Exceptional Customer Service at Southwest Airlines

Southwest Airlines continues to lead the airline industry in customer satisfaction because their business model puts customer satisfaction and maximizing customer experiences at its center. Their leadership of the industry on customer satisfaction measures has also been seen in the result of Consumer Reports studies as well (Consumer Reports, 2007). What sets this airline apart from others is the belief that customer loyalty will lead to more profitable growth when combined with an extensive commitment to process, system and service standardization (Hardage, 2006).

Analyzing Why Southwest Excels At Customer Service

Southwest Airlines' founders quickly realized that their business model must attract the mid-range and casual traveler if they were to succeed. They did not initially pursue the highly profitable business traveler as their competitors were doing at the time. Instead, the company quickly built ticketing, in-flight services, aircraft operations and maintenance all around the expectations of their customers (Bernoff, Li, 2008). This resulted in the corporate culture at Southwest being much more focused on taking risks to ensure customer satisfaction and delight over merely attaining cost reductions (D'Aurizio, 2008). The frequent flyer program at Southwest rewards the most loyal customers with flights according to a series of simple, easily understood guidelines that promote using the airline over smaller regional carriers.

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This is a deliberate strategy to drive up customer loyalty while at the same time taking business away from smaller, regional airlines (Rhoades, 2006). These decisions that management has made about designing and strengthening their business model to serve customers has led to a very customer-centric culture as well. The culture at Southwest has stories permeating it that show how employees went beyond their roles to ensure customers get to their destinations delighted with service (D'Aurizio, 2008). After the decades of their business model continually building these values, the norm today is for employees to extend a hand to customers and seek to serve and gain customer loyalty as a result.

Recommendations

Southwest Airlines has done an exceptional job of building a loyal customer base, which combined with their unique approach to fuel hedging costs, has given them the ability to stay profitable while their many competitors have not (D'Aurizio, 2008). The use of social media has also been an emerging strength of the company as well (Bernoff, Li, 2008). The company however has not been successful in creating strong word-of-mouth across small businesses to match the potential it has based on the strong customer-centric culture it has. The following are recommendations for how the company can further increase its share of the small business market.

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