THE UNIVERSITY OF SOUTHERN MISSISSIPPI

1. Ce Center for Logistics, Trade and Transportation and College of Business THE UNIVERSITY OF SOUTHERN MISSISSIPPI Study Abroad in PanamaCoordinated byDr. TulioSulbaranTel: 601-266-6419 - Email: tulio.sulbaran@usm.edu COMPARISON OF BUSINESS STRATEGIES: COPA AIRLINES VS. SOUTHWEST AIRLINESPresented by:Nicole NettlesTel: 228-218-1957 - Email: nicole.nettles@eagles.usm.edu Jul 2012

2. Video Preamble

3. Outline • 1- Introduction • 2- Information/Data Collection Approach • 3- Case Study • 4- Results and Results Impact • Similarities • Differences • 5- Summary

4. Introduction Differentiation Strategy- an attempt at which companies strive to create products or services that are different and unique from other products or service in the industry

5. Introduction • Panama: • Dollar-Based Economy • Relies heavily on services, 1/3 of GDP • Services include Panama Canal, banking, insurance, logistics, ports, Colon Free Trade Zone, tourism • Panama Canal Expansion expected to boost economy • Unemployment Rate was 4.5% in 2011

6. Introduction This report compares the differentiation strategies in the airline industry. The comparison includes the companies Copa Holdings, Inc. and Southwest Airlines.

7. Information/ Data Collection Approach • First form of data collection was a Internet search • Internet Search began close to a month before leaving • Google Search Engine • Specific keywords used to locate related information • 12 sources were chosen to complete report

8. Information/ Data Collection Approach Informationgathered from Internet Search: • Southwest Airlines’ Seven Secrets for Success • BusinessDictionary.com • CIA- The World Fact Book • Center for Aviation • Copa Airlines • Nation Branding & Investment • NCR Corporation • The Official Klout Blog • What makes COPA • Airlines one of the most popular airline brands in the world? An Interview with two senior execs • Standard & Poor’s: Southwest Airlines Co. • Standard & Poor’s: Copa Holdings Inc. • Zacks Equity Research

9. Information/ Data Collection Approach • Second Form of Data Collection was In-Person Interview • Joseph Maugh from the University of Florida, Commercial and Planning Vice President at Copa Airlines • Interview Questions asked: • What is the background and goals of Copa Airlines? • How is Copa differentiated in the airline industry in Latin America?

10. Information/ Data Collection Approach • Copa differentiates itself through efficiency and the experience customers receives • Connectivity is also a major advantage Copa has over it competitors, they provide flights departing to the same locations frequently • Efficiency, Experience, Connectivity

11. Case Study “Copa Holdings is a leading Latin American provider of airline passenger and cargo services through our tow principal operating subsidiaries, Copa Airlines and Copa Airlines Columbia.” –Copa Airlines • Copa Holdings Inc.: • Located in Panama City, Panama • Main hub located in Tocumen Airport • Incorporated as a sociedad anonima in 1998 • CIASA, 49% stake to Continental, then reduced share to 27.3% in 2005, and 10% in 2006, sold remaining shares in 2008 to public • Copa purchased AeroRepulica in 2005, expanding to 63 destinations in 29 countries

12. Case Study • Southwest Airlines: • Headquartered in Dallas, TX • Began as Air Southwest Co. in 1967 to provide airline services for Texas area • 73 locations in US • Average flight length 969 miles • Only utilizes Boeing 737 aircraft in fleet of 558 • 3,200 flight per day • Net Income $178 million in 2011

13. Results and Results Impact • Aspects Compared Between Companies: • Overall business strategy • Average cost for an airline ticket • Methods for checking in and assigning customers a location on the plane • Service provided by airline attendants • On-flight amenities • Marketing strategy • Overall mentality of the business model

14. Results and Results Impact Similarities:

15. Results and Results Impact Differences

16. Results and Results Impact • The similarities in these results are important because it can be seen that companies all over the world utilize the same business strategies in order to gain an advantage within their respective markets. No matter the location of the company business works the same way, and many companies have utilized similar avenues to be successful. • The difference in these results are important because we can see that both companies have created a sustainable competitive advantage with the industry utilizing a differentiation strategy, but have created the advantage in two very different ways.

17. Summary • Compares differentiation strategies between Copa and Southwest • Copa uses efficiency, experience, and connectivity, Southwest uses low costs and relaxed atmosphere • Data was collected using an Internet search and in-person interviews • Similarities include: overall strategy, marketing efforts, online services • Differences include: ticket price, company focus, seating and layout of the aircraft, amenities provided on the plane, employee attitudes and atmosphere • Both companies are exceptional examples of how successful companies utilize differentiation strategies

18. THE UNIVERSITY OF SOUTHERN MISSISSIPPIfounded in 1910 Thanks! Center for Logistics, Trade and Transportation and College of Business