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External Factors Affecting the Airline Industry

Identify and explain key external factors that affect the passenger airline industry.
Explain the major airline market segments by applying the marketing concepts of segmentation, targeting, and positioning.
Contrast United and Delta Airlines in terms of each company's target market and positioning. Give some examples of how these strategies are implemented for each company.

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External Factors Affecting Airline Industry
Political and Legal factors
Political and legal factors include government intervention to protect passenger's interest and promote safety measures in operations. The political environment in which airline industry operates has high degree of regulation and restrictions.

Economic factors
Economic factors like gross domestic product, per capita income, disposable income, etc affect airline industry. For example, if consumers have more disposable income they would be more likely to spend on leisure travel. Growth in businesses across industries also has a direct impact on airline industry as it would have a positive impact on demand for business travel. In addition, the main factor which affects airline's profitability is fluctuation in oil prices.

Social and demographic factors
Demographic factors help in forecasting demand for airline travel and help in estimating customer's future travel preferences.

Technological factors
Changes in technology provide new avenues to airlines for reducing operating costs and increasing ...

Solution Summary

The document lists external factors which affect airline industry, provides overview of what are customer segments for airlines and compares United airline and Delta airline.