Abstract

American Airlines (AA), one of the world’s leading airline carriers, attracted the attention of industry observers for its target marketing strategy for diverse segments. In particular, it was widely recognized for its initiatives at targeting the LGBT (lesbian, gay, bisexual, and transgender) segment. It was one of the first major companies to make a concerted effort to tap this segment. It started a dedicated Marketing and Sales team focused on the LGBT segment as far back as 1994. The team was later renamed ‘Rainbow TeAAm’. The Rainbow TeAAm had over the years done some pioneering work in this area and firmly established AA as the preferred airline for the LGBT consumer. In addition to developing travel packages that would appeal to the segment and other outreach initiatives, the Rainbow TeAAm also helped develop web pages focused on the LGBT segment. The case discusses the initiatives taken by AA and its Rainbow TeAAm to tap the fast growing LGBT travel market. It also discusses the various issues and challenges in targeting the market. The case ends with the challenges faced by the company in maintaining and enhancing its brand position as the most popular airline of LGBT-choice at a time when more and more companies are trying to target this lucrative segment.

Learning Objectives

The case is structured to achieve the following Learning Objectives:

• Understand the issues and challenges in market segmentation and targeting. Understand the dynamics of the LGBT market with special emphasis on the LGBT travel market. Analyze the strategies adopted by AA in tapping the LGBT segment. Understand the critica

Keywords

Market segmentation, Targeting, Consumer behavior, Lesbian, gay, bisexual, and transgender people, LGBT, LGBT-focused sales and marketing team, Diverse Segment Marketing, LGBT Travel Market, Gay and Lesbian Tourism, Advertising, Online marketing, Sponsorships, LGBT sales team, Niche segment, Purchasing power, Brand loyal, Disposable income, Early adopters, Purchase decision, Diversity, Diversity training, Gender identity, Sexual orientation, Supplier diversity, Corporate equality index