Comments on: The Future of Airline Loyalty Programs http://crankyflier.com/2008/12/10/the-future-of-airline-loyalty-programs/ Thu, 24 May 2012 14:37:14 +0000 hourly 1 http://wordpress.org/?v=3.3.2 By: 5 Credit Card Predictions for 2012 http://crankyflier.com/2008/12/10/the-future-of-airline-loyalty-programs/comment-page-1/#comment-402930 5 Credit Card Predictions for 2012 Tue, 10 Apr 2012 11:08:11 +0000 http://crankyflier.com/?p=1729#comment-402930 [...] 2008, I wrote Th&#1077 Future &#959f Airline Loyalty Programs f&#959r a travel blog, &#1072n&#1281 I predicted th&#1072t airlines w&#959&#965&#406&#1281 [...] [...] 2008, I wrote Th&#1077 Future &#959f Airline Loyalty Programs f&#959r a travel blog, &#1072n&#1281 I predicted th&#1072t airlines w&#959&#965&#406&#1281 [...]

]]> By: 5 Credit Card Predictions for 2012 | Zimbabwe Telegraph http://crankyflier.com/2008/12/10/the-future-of-airline-loyalty-programs/comment-page-1/#comment-341941 5 Credit Card Predictions for 2012 | Zimbabwe Telegraph Tue, 24 Jan 2012 16:49:15 +0000 http://crankyflier.com/?p=1729#comment-341941 [...] 2008, I wrote Th&#1077 Future &#959f Airline Loyalty Programs f&#959r a travel blog, &#1072n&#1281 I predicted th&#1072t airlines w&#959&#965&#406&#1281 [...] [...] 2008, I wrote Th&#1077 Future &#959f Airline Loyalty Programs f&#959r a travel blog, &#1072n&#1281 I predicted th&#1072t airlines w&#959&#965&#406&#1281 [...]

]]> By: Where Are Airlines Going With Their Loyalty Programs in 2012? (Guest Post) - >> The Cranky Flier http://crankyflier.com/2008/12/10/the-future-of-airline-loyalty-programs/comment-page-1/#comment-330556 Where Are Airlines Going With Their Loyalty Programs in 2012? (Guest Post) - >> The Cranky Flier Tue, 10 Jan 2012 11:46:23 +0000 http://crankyflier.com/?p=1729#comment-330556 [...] the name down below looks familiar, it’s because he wrote a guest post here on the future of airline loyalty programs way back in 2008. Now he’s back to fill in while I’m on paternity leave. – Last [...] [...] the name down below looks familiar, it’s because he wrote a guest post here on the future of airline loyalty programs way back in 2008. Now he’s back to fill in while I’m on paternity leave. – Last [...]

]]> By: 5 Credit Card Predictions for 2012 | Credit Tips Today http://crankyflier.com/2008/12/10/the-future-of-airline-loyalty-programs/comment-page-1/#comment-321412 5 Credit Card Predictions for 2012 | Credit Tips Today Fri, 30 Dec 2011 01:56:24 +0000 http://crankyflier.com/?p=1729#comment-321412 [...] 2008, I wrote The Future of Airline Loyalty Programs for a travel blog, and I predicted that airlines would start switching from miles to points worth [...] [...] 2008, I wrote The Future of Airline Loyalty Programs for a travel blog, and I predicted that airlines would start switching from miles to points worth [...]

]]> By: 5 Credit Card Predictions for 2012 http://crankyflier.com/2008/12/10/the-future-of-airline-loyalty-programs/comment-page-1/#comment-321285 5 Credit Card Predictions for 2012 Thu, 29 Dec 2011 19:43:53 +0000 http://crankyflier.com/?p=1729#comment-321285 [...] 2008, I wrote The Future of Airline Loyalty Programs for a travel blog, and I predicted that airlines would start switching from miles to points worth [...] [...] 2008, I wrote The Future of Airline Loyalty Programs for a travel blog, and I predicted that airlines would start switching from miles to points worth [...]

]]> By: 5 Credit Card Predictions for 2012 | Money Talks News http://crankyflier.com/2008/12/10/the-future-of-airline-loyalty-programs/comment-page-1/#comment-320938 5 Credit Card Predictions for 2012 | Money Talks News Thu, 29 Dec 2011 10:40:55 +0000 http://crankyflier.com/?p=1729#comment-320938 [...] Jason Steele | Dec 29, 2011 In 2008, I wrote The Future of Airline Loyalty Programs for a travel blog, and I predicted that airlines would start switching from miles to points worth [...] [...] Jason Steele | Dec 29, 2011 In 2008, I wrote The Future of Airline Loyalty Programs for a travel blog, and I predicted that airlines would start switching from miles to points worth [...]

]]> By: Ripoff Alert « Justin Nachod’s Blog http://crankyflier.com/2008/12/10/the-future-of-airline-loyalty-programs/comment-page-1/#comment-68395 Ripoff Alert « Justin Nachod’s Blog Mon, 15 Dec 2008 01:32:25 +0000 http://crankyflier.com/?p=1729#comment-68395 [...] info By jnachod Categories: Uncategorized While reading a recent post on the Cranky Flier blog about airline rewards programs, I read that United Airlines sells a round trip ticket from Washington Dulles ( which is actually [...] [...] info By jnachod Categories: Uncategorized While reading a recent post on the Cranky Flier blog about airline rewards programs, I read that United Airlines sells a round trip ticket from Washington Dulles ( which is actually [...]

]]> By: Eric Meadows http://crankyflier.com/2008/12/10/the-future-of-airline-loyalty-programs/comment-page-1/#comment-68339 Eric Meadows Thu, 11 Dec 2008 20:48:48 +0000 http://crankyflier.com/?p=1729#comment-68339 As a Platinum flyer on Delta much of what Jason states resonates and brings a new view on the value of airline miles, but for someone like me the miles are secondary or tertiary to other program benefits like upgrades, seat selection, upgrade certificates and additonal perks that I garner every time I travel. I guess it depends on your perspective and mission with flying on how you view the current iterations of frequent flyer programs. I simply would like to note that mileage is only part of the larger equation and given your mission might only prove to be part of the picture. As a Platinum flyer on Delta much of what Jason states resonates and brings a new view on the value of airline miles, but for someone like me the miles are secondary or tertiary to other program benefits like upgrades, seat selection, upgrade certificates and additonal perks that I garner every time I travel.

I guess it depends on your perspective and mission with flying on how you view the current iterations of frequent flyer programs. I simply would like to note that mileage is only part of the larger equation and given your mission might only prove to be part of the picture.

]]> By: The Traveling Optimist http://crankyflier.com/2008/12/10/the-future-of-airline-loyalty-programs/comment-page-1/#comment-68306 The Traveling Optimist Wed, 10 Dec 2008 20:23:52 +0000 http://crankyflier.com/?p=1729#comment-68306 Ask any airline manager who's been in the business longer than the last 15 years and he or she may well tell you of one story that still resonates and frightens them all to this day. If I remember it correctly, it goes something like this: When FF programs were just beginning and fraud suits were starting to fly, Pan Am opened every seat on every flight for one day to allow customers to burn miles. One flight out of all of them took an unimaginable hit. A 747 left LHR for JFK with every seat in the house taken by free travelers. Except seven. Do we as a customer base care? Absolutely not. Is Pan Am still around? For this and numerous other reasons....absolutely not. Thus spake Randy: A Thursday morning flight to Des Moines? Take any seat in the house. Friday afternoon to Chicago? Cash, check AND credit card, please. Ask any airline manager who’s been in the business longer than the last 15 years and he or she may well tell you of one story that still resonates and frightens them all to this day.

If I remember it correctly, it goes something like this:

When FF programs were just beginning and fraud suits were starting to fly, Pan Am opened every seat on every flight for one day to allow customers to burn miles. One flight out of all of them took an unimaginable hit.

A 747 left LHR for JFK with every seat in the house taken by free travelers. Except seven.

Do we as a customer base care? Absolutely not.
Is Pan Am still around? For this and numerous other reasons….absolutely not.

Thus spake Randy: A Thursday morning flight to Des Moines? Take any seat in the house. Friday afternoon to Chicago? Cash, check AND credit card, please.

]]> By: Randy http://crankyflier.com/2008/12/10/the-future-of-airline-loyalty-programs/comment-page-1/#comment-68305 Randy Wed, 10 Dec 2008 20:02:00 +0000 http://crankyflier.com/?p=1729#comment-68305 In revenue management, I always viewed it as my job to make sure that high yield Y or B class seats were left for frequent fliers to book right before a flight. It was a gamble on how many hold back. Yes there are the gripes of an $800 ticket vs. a $200 ticket, but it would be easy to sell out the entire plane with $200 tickets. Holding back inventory till the last minute for the forecasted $1000 ticket is an educated risk. If the airfare wasn't higher, there would be no incentive to hold back inventory till the last minute. Business travelers would be confronted with sold out flights when trying to book a ticket to a last minute meeting. How big the full vs. discounted spread should be is an open debate. Their is the potential for spoilage by not selling the seat at a lower price earlier on. Business travelers on the company dime are also not as price sensitive as someone spending their own money. Individuals also plan farther ahead than most business people can. Virgin America is one of the few to deal with the high yield reward issue by giving points based on money spent and not miles flown. All the other mileage programs have devolved into a revenue source, not a loyalty program. Bonuses can easily be matched, so there there is little incentive to reward their best customers through program rules. Behind the scenes Sales gives out goodies to their best accounts. On the flip side, revenue management tries to make sure the store isn't given away. I was pretty brutal about FF availability on Friday and Sunday evenings, and any flight around 5PM. Other times of the week the plane go be half open for FF. We had rules that at least 10% of overall inventory had to open to FF, or else we could open ourselves up to a fraud lawsuit. The 10% was over the course of the year, for the entire system, and each market and by time of year varied widely. Of course this was many moons ago. I still wonder whether UA's pledge to hold back at least 2 FF seats on every flight is still in affect. Silly to promise that on your best flights of the year. FF seats actually do get assigned a cash value in managing inventory. With half of the miles sold, they sometimes represent better fares than what are sold in a market. In revenue management, I always viewed it as my job to make sure that high yield Y or B class seats were left for frequent fliers to book right before a flight. It was a gamble on how many hold back. Yes there are the gripes of an $800 ticket vs. a $200 ticket, but it would be easy to sell out the entire plane with $200 tickets. Holding back inventory till the last minute for the forecasted $1000 ticket is an educated risk. If the airfare wasn’t higher, there would be no incentive to hold back inventory till the last minute. Business travelers would be confronted with sold out flights when trying to book a ticket to a last minute meeting.
How big the full vs. discounted spread should be is an open debate. Their is the potential for spoilage by not selling the seat at a lower price earlier on. Business travelers on the company dime are also not as price sensitive as someone spending their own money. Individuals also plan farther ahead than most business people can.
Virgin America is one of the few to deal with the high yield reward issue by giving points based on money spent and not miles flown. All the other mileage programs have devolved into a revenue source, not a loyalty program. Bonuses can easily be matched, so there there is little incentive to reward their best customers through program rules. Behind the scenes Sales gives out goodies to their best accounts. On the flip side, revenue management tries to make sure the store isn’t given away. I was pretty brutal about FF availability on Friday and Sunday evenings, and any flight around 5PM. Other times of the week the plane go be half open for FF. We had rules that at least 10% of overall inventory had to open to FF, or else we could open ourselves up to a fraud lawsuit. The 10% was over the course of the year, for the entire system, and each market and by time of year varied widely. Of course this was many moons ago.
I still wonder whether UA’s pledge to hold back at least 2 FF seats on every flight is still in affect. Silly to promise that on your best flights of the year. FF seats actually do get assigned a cash value in managing inventory. With half of the miles sold, they sometimes represent better fares than what are sold in a market.

]]>