Southwest Airlines 2015 Annual Report Download - page 15

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For the Company’s 2015 consolidated results, Customers of Southwest redeemed approximately
7.3 million flight awards, accounting for approximately 12.0 percent of revenue passenger miles flown.
For the Company’s 2014 consolidated results, Customers of Southwest and AirTran redeemed
approximately 6.2 million flight awards, accounting for approximately 11.0 percent of revenue
passenger miles flown. For the Company’s 2013 consolidated results, Customers of Southwest and
AirTran redeemed approximately 5.4 million flight awards, accounting for approximately 9.5 percent
of revenue passenger miles flown. The Company’s accounting policies with respect to its frequent flyer
programs are discussed in more detail in Note 1 to the Consolidated Financial Statements.
Southwest.com
The Company’s Internet website, Southwest.com®, is the only avenue for Southwest Customers to
purchase and manage travel online. Customers’ trips can be planned and managed directly from the
southwest.com home page. Southwest.com is designed to help make the Customer’s experience
personal and intuitive with features such as recognizing the Customer’s location to provide relevant
deals, remembering recent searches to make it easy to get to trips of interest, and shopping cart
functionality allowing Customers to purchase air, hotel, and car rental in one visit. The newly
redesigned “My Accounts” section of the website provides a detailed view into a Customer’s travel and
loyalty activity. Southwest.com highlights points of differentiation between Southwest and other air
carriers, as well as the fact that southwest.com is the only place where Customers can purchase
Southwest fares online. In addition, southwest.com and swabiz.com (the Company’s business travel
reservation web page) are available in a translated Spanish version, which provides Customers who
prefer to transact in Spanish the same level of Customer Service provided by the English versions of
the websites. Additionally, Southwest offers Customers a mobile website and app to provide
Customers the ability to transact with Southwest anytime they have access to their mobile device. For
the year ended December 31, 2015, approximately 79.4 percent of the Company’s Passenger revenues
came through its website (including revenues from SWABIZ®).
Marketing
During 2015, the Company continued to benefit from, and aggressively market, Southwest’s points of
differentiation from its competitors. In October 2015, the Company premiered a new advertising campaign
called TransfarencySM. The campaign emphasizes Southwest’s approach to treating Customers fairly,
honestly, and respectfully, with its low fares and no unexpected bag fees, change fees, or hidden fees.
Southwest continues to be the only major U.S. airline that offers to all ticketed Customers up to two
checked bags that fly free (weight and size limits apply). Through both its national and local marketing
campaigns, Southwest has continued to aggressively promote this point of differentiation from its
competitors with its “Bags Fly Free®” message. The Company believes its decision not to charge for
first and second checked bags on Southwest, as reinforced by the Company’s related marketing
campaign, has driven an increase in Southwest’s market share and a resulting net increase in revenues.
Southwest is also the only major U.S. airline that does not charge a fee on any of its fares for a
Customer change in flight reservations. The Company has continued to incorporate this key point of
differentiation in its marketing campaigns. The campaigns highlight the importance to Southwest of
Customer Service by showing that Southwest understands plans can change and therefore does not
charge a change fee. While a Customer may pay a difference in airfare, the Customer will not be
charged a change fee on top of any difference in airfare.
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