Chapter 2 questions 1. Consider every tactic that Southwest is employing to curtail slumping sales. Evaluate the degree to which each is effective at accomplishing Southwest's goal.2. Are Southwest's efforts enough? Is it possible for Southwest to reverse the effects of the strong industry slump?

Staying on the Road: Marketing Ethics Marketing to children has always been controversial. teens spending billions of their own dollars and influence Indeed, in the 1970s, the Federal Trade Commission (FTC) ing much more of their parents' spending, this is an im considered prohibiting all advertising to children. The fed- portant market segment to marketers. eral government once again is setting its sights on market- ing aimed at children. With the U.S. child obesity rate and 1. Studies report that children view more than 20 food predicted to exceed 20 percent in just a few years, regula- ads each day, of which over 90 percent promote high tors are pressuring marketers in general, and food mar- fat, high-sugar products. The marketing concept fo keters in particular, to curb their marketing practices to cuses on satisfying customers' needs and wants, but children. In 2008, the FTC delivered an analysis to are marketers crossing the line when they cater to Congress of 44 companies' $1.6 billion food and beverage younger consumers' wants for products that may marketing activities targeting children. A provision in the counter parental wishes or that may be unhealthy 2009 omnibus spending bill signed into law by President (AACSB: Communication; Ethical Reasoning) Barack Obama created the Interagency Working Group on Food Marketed to Children. This group will present recom- 2. What actions are marketers taking to market their mendations to Congress in 2010 regarding marketing to products to this market segment more ethically children aged 17 and younger (an expansion of previous Discuss industry initiatives that help marketers mar under-12 definitions of "children"). With children and ket to children more responsibly. (AACSB: Communi cation; Ethical Reasoning) Chapter 2 Company and Marketing Strategy: Partnering to Build Customer Relationships 63 Rough Road Ahead: Marketing and the Economy Southwest Airlines checking baggage, sitting in aisle seats, or using pillows. But As more and more consumers have cut back on spending Southwest insists that such fees are no way to grow an air- perhaps no industry has been hit harder than the airlines. line. Other attempts to jumpstart demand include an ad Even Southwest Airlines, which has posted profits in every campaign urging consumers to continue traveling despite one of its 36 years of operation, is now seeing declines in its the lagging economy and a company-wide fare sale with one-way rates as low as $49. Southwest's hopes that these sales, profits, and stock price. So what's Southwest doing? efforts will bring customers back and curb the revenue slide. For starters, Southwest is expanding beyond the 65 cities it now serves. It is also attempting to sweeten the ride by 1. Consider every tactic that Southwest is employing to boosting wine and coffee service and experimenting with curtail slumping sales. Evaluate the degree to which onboard WiFi, something other carriers have already added. each is effective at accomplishing Southwest's goal. But perhaps more important is what no-frills Southwest isn't doing: adding fees. Other airlines are generating mil- 2. Are Southwest's efforts enough? Is it possible for South- lions of dollars in revenues by charging for basics like west to reverse the effects of the strong industry slump