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MBA6225 Consumer Behavior and Marketing within the
Hospitality Industry
© 2010 South University
JetBlue Airways
Overview of the Organization
JetBlue Airways was incorporated in Delaware in Aug
ust 1998. JetBlue’s headquarters is in
Forest Hills, New York, and its main hub is New Yor
k’s John F. Kennedy (JFK) Airport. JetBlue is
a low-cost, domestic airline in the United States,
and it has an interesting combination of
implementing its low-cost and differentiation strat
egy. From its beginning in 1998, the airline grew
to become the eleventh largest entity in the airlin
e industry in a short span of six years.
The current chief executive officer (CEO), David G.
Neeleman, founded the company in February
1998 under the name of NewAir. Most of the executiv
es of JetBlue, including Neeleman, are
former Southwest Airlines employees. What JetBlue i
ntended to do was to offer low-fare flights
designed to stimulate demand. In addition to its lo
w fares, the company offered unique products
designed to differentiate it from other airlines. T
he way it distinguishes itself from other airlines
is
by offering products such as new aircraft, leather
seats, reliable operating performance, and
thirty-six channels of live television and movie se
lections from Fox-in-Flight entertainment at
every seat.
JetBlue was launched with a huge amount of capital,
brand new aircraft, and expert personnel in
key positions. It grew rapidly as customers flocked
to it to escape the steep fares and frequent
delays of the major airlines. In the early 1990s, m
any small start-up airlines also tried the low-fare
formula, but they failed in the face of direct comp
etition from the major airlines, which were able
to withstand the fare wars. Since 1978, more than n
inety-seven airlines have failed because of
insufficient capital and insufficient management ta
lent.
According to Neeleman, it took thirty months of pla
nning…