Income Sources

Delta’s financial condition is very appealing to its stakeholders. According to company’s annual reports Delta has been operating under increasing revenues since it developed the e-business model (Morrell, 2002). The major source of income for Delta airlines is the sale of travelling tickets. This covers about 70% of the total revenues generated. In 2012, the company reported revenue of about $36.6 billion which was about 5% increase from 2011. This was brought by increase in the number of passengers in that financial year. The company also earns income from sell of shares. Delta CEO Anderson Richard argue that the company’s return to profitability started in 2010 when the company made $1.71 per share leading to income of about $1.5 billion in 2011.Disposal and leasing of assets is another source of income to Delta. According to the management, lending out brought more revenues than disposal of assets. Priceline was the most convenient partner in disposal of excess and unused furniture (Morrell, 2002). In 2011 Delta earned about $2 billion from disposal and leasing of assets. This revenue was used in development of both employees and customer reward program. Delta makes revenue from non-tickets including in-flight food, baggage charges and travel insurance. The company made about $22 billion from these in 2011. These ancillary revenue are used to provide a boost for runway fuel bills. The company also made revenues from telecommunication services. Economists argue that aviation industry are indirectly charging customers for internet related services. From the SWOT analysis carried in 2012, Delta developed cost saving strategy to save on the generated revenues. Fuel hedging program and operational improvement were developed through effective flight scheduling, older less fuel efficient fleet, improving maintenance process and maximizing crew resources.
(Morrell, P. S. (2002). Airline finance. Aldershot, Hants, England, Ashgate.)Impact of digital sourceDigital source has brought positive development strategies to Delta hence currently enjoying superiority in the airline industry. In 1994, the company became the first airline in the industry to technologically advance its operations hence meeting customer satisfaction, Delta airlines grouped its customers according to needs, behaviors and attributes. Internet has become a distribution channel for sale of tickets. Over 1.5 billion people globally use the internet hence Delta is able to minimize communication cost with its companies (Teneja, 2002).Digital source has contributed to the profitability of Delta. The internet works as management and distribution channel tool. Digital business have the advantage of management cost reduction hence becoming a key element in improving operating profitability. Digital source has also enabled Delta to work correctly with the current market situation. The company’s website ensures that all the markets in the industry are accessed (Teneja, 2002).
The fast search engines in the company’s website have enhanced easier access to the site by passengers. Digital business has strengthen relationship between the company and customers. This ensures easier communication and timely attendance to the customers’ preferences. A strong Customer relationship improves the competitive capacity of the company. Since the Delta advanced as digital company, its competitive advantage has been gradually strengthening. E-business ensured awareness of who to be addressed and the requirement of the passengers. This can help delta to utilize the available resources to ensure achieving the management target towards customer satisfaction. Aside from the opportunity to visit a wide variety of on-line shops, e-business allows customers to check complete information about a certain new service. In addition to that, there are no sales persons pressuring the customer into buying a product. (Taneja, N. K. (2002). Driving airline business strategies through emerging technology).