Edited by Gary L. Lilien and Rajdeep Grewal
Chapter 22: B2B Relationship Underpinnings of Outsourcing
1 Rajan Varadarajan ● ● ● According to news reports, during the latter half of 2009, Delta Air Lines and its alliance partners in the SkyTeam Alliance offered $1 billion in aid to Japan Airlines (JAL) to lure it away from Oneworld Alliance. American Airlines and its alliance partners in the Oneworld Alliance reportedly matched the offer to retain JAL in their alliance network. Despite incurring huge losses in recent years and being saddled with debt, JAL was viewed as an attractive alliance partner by both global airline alliances because of its strong market position in Japan and the rest of Asia and the benefits alliance members envisioned deriving from a code-sharing agreement with JAL (Tabuchi 2009). After weeks of speculation, JAL finally chose to remain in the Oneworld alliance. AT&T, a mobile phone service provider, enjoyed an exclusive right to offer Apple smart phones for a limited time. However, during this window, the exclusive agreement was reported to have significantly enhanced AT&T’s ability to retain its present customers as well as attract competitors’ customers. Vizio Inc. is a dominant player in the market for LCD TVs in the United States. By focusing its efforts on design and marketing and contracting production to manufacturers, Vizio has been able to sell its LCD TVs through discount retailers in the United States at substantially lower prices than those of its major competitors, such as Samsung and Sony. As these examples illustrate, B2B relationships are a critical building block in the competitive marketing strategies...
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