Tomorrow, I’m Telling Airline Marketing Folks What Customers Want – So What Do You Want?

I mentioned yesterday that I am attending the ARAC FFP Mega Event this week and that I’d be speaking tomorrow. Well, it turns out that I could use your help.

This event is attended by industry people – the same people who are responsible for making changes to their frequent flier programs. Most of the events so far have been about how companies have successfully extracted more money from customers while “improving the customer experience” or something like that. But tomorrow, I will be joining up with Nicholas Kralev from the Washington Times for this discussion:

Listening to your customers- what are customers saying about loyalty programs?

So we’ll have the ears of many decision makers tomorrow on the subject that I know you all love to talk about. Let’s have it. What would you like me to say to them?


48 Responses to Tomorrow, I’m Telling Airline Marketing Folks What Customers Want – So What Do You Want?

  1. United is the the hub in Denver and now they are offering elite status to anybody that wants to pay for it. I flew them this and last year to make elite status for the perks and now they pull this on me. So what reason do I have to keep flying them over say Delta or any other airline?

    Also please just increase the prices of tickets by $15 and cut bag fees so people will start checking bags and make boarding less painful.

  2. Chris says:

    No surprise fees OR devaluations.

  3. Chris says:

    Also, customer appreciation events like CO & DL have done in recent years were WONDERFUL ways of connecting to high revenue and mileage customers. These built enormous goodwill with the invitees, I’m still telling people about what a wonderful time I had.

    Additionally, the insight into how the cogs make the big airline machine work was invaluable in understanding what happens when there are “issues”.

    Though that’s not available to all, it’s a great way to manage high value customers.

    Another thing, bonuses and promotions are a good way to keep people happy BUT make sure that they are managed properly. Having to email 10 times to get an appropriate resolution is unacceptable.

    FInally, customer engagement is extremely important. Social media resources like Facebook, Twitter and FlyerTalk should have corporate people there to answer questions and help out. Starwood has been extremely proactive on this front, as well as CO and their representatives have created significant goodwill along with identifying problems within their programs and at their properties.

  4. Rob Marais says:

    First, a mileage bonus (increasing by tier). Second, preference when boarding. Third, freedom from ancillary fees (i.e. baggage fees, preferred seating fees, in the future pay toilet fees). Fourth, tier-based opportunity for unlimited upgrades subject to availability (preferably on both domestic and int’l flights). Fifth, enhanced award inventory increasing by tier. Finally, dedicated customer service help via phone, Web and SMS.

    Those are the basics to me. So far, DL has delivered except for int’l upgrades for Gold and below, though it is rolling out auto upgrades on award flights in 2010.

  5. Gary Leff says:

    Honesty, Transparency, Integrity.

    Those sound old fashioned, but I’m serious. Bear with me.

    Don’t talk about ‘enhancements’ that are really devaluations. Your customers resent being lied to.

    (Oh, and don’t ACTUALLY lie, either. Don’t promise something like the ability to redeem award seats on your partner airlines and then when a partner is offering an award seat don’t refuse to let your customer book it. And don’t tell your customer that the airline “isn’t offering the seat.” And don’t tell the customer that the partner airline doesn’t even fly the route on that day. I’m talking to you, United. 100% seriously.)

    Offer a clear value proposition and STICK TO IT.

    I disagree with @Chris who says no devaluations. Just be clear about what you are doing and give PLENTY of notice. So that there’s a clear connection between an offer, customer behavior, and a reward. When you offer benefits, customers fly to earn those benefits, and you change the rules of the game just as they’re about to experience those benefits… #FAIL … seriously. So declare by the end of February, 2010, say, what the 2011 program will look like. And stick to it.

    In this same light, I agree with @Chris, though, that there is good online social media communication from a couple of companies like Starwood. Engage your customer, honestly and transpanretly. With a strong customer service presence and not a marketing, PR, or spin shop.

    Tell the truth. Declare it openly, warts and all. And then deliver on your declarations. And your customers will love you for it.

  6. dylan says:

    I agree 100% with the checked baggage thing. Charge an arm and a leg for the second if you want, or even add a $50 charge to check at the gate if need be- but boarding has become excruciating, and it gets worse the smaller the plane/cheaper the ticket (AA MD-80s most notably).

    It would be nice to see a small fringe benefit for Elites that can’t pull an upgrade for whatever reason (I doubt a Gold has upgraded to business JFK-LAX in the history of the world). Even a coupon for a free in-flight drink- this makes the flight go smoother, and will cause other passengers to ask “how’d you get that”, therefore increasing customer base, so on so on.

    Dedicated boarding lanes, dedicated security lanes, and pre-boarding are most appreciated and beloved. But don’t devalue it- if every rich moron and his five kids gets to preboard for $15, what’s the point?

  7. Axelsarki says:

    Tell them that they need to re think their Whole system, sarting out with being transparent, and about everything that the people above said. Oh, and metion a 12 year old kid said that.;)

  8. Axelsarki says:

    Tell them that they need to re think their whole system, sarting out with being transparent. Yea, tell UA that buying the status is not going to keep the real frequent people staying, as they might as well fly a better airline. There should be things that frequent travelers get because they bring the company money. So, if you can pretty much buy all the perks, why should people stay with them? Oh, and mention a 12 year old kid said that.;)

    Axel.

  9. Axelsarki says:

    @ Axelsarki:

    Humm, that is odd, that is a draft I had before, I never pressed send. (??) Disregard.

  10. Wonko Beeblebrox says:

    I’d like to know if more airlines are planning to do one-way awards (ala Alaska, AA, and somewhat Frontier), priced at 1/2 the r/t redemption value.

    Those are useful.

  11. Johnny Plane says:

    Please tell them to make claiming miles from past flights easier and to make claiming miles earned with partners programs easier!

    Thanks!

  12. myriam says:

    There are only, ONLY two things I (as a lowly Silver member) want that I haven’t yet gotten :

    1/ Give me a few “change your ticket for free” passes every year. Even if it’s just 2 or 3. I, like many people, have shifting travel requirements (meeting gets moved) and I have flown Southwest a few times in the past year simply because the travel dates were up in the air and I needed to secure my ticket. Their no-change-fee policy could easily be semi-adopted in the legacy elites.

    2/ Let me use my miles on your partner airlines. What good is it to me to work towards 150,000 miles or whatever if it turns out I’m just flying to Pheonix 5 times with that?

    That’s it. I think I’m happy with everything else! Selling day-passes to the member lounges was a great idea, btw.

  13. Karthik says:

    Please tell united to allow passengers to hold ticket reservations for 24 hours like we used to be able to do in the past. Maybe something along the lines of $5 for a reservation hold (token amount but psychologically a lot) and free for elites.

  14. Graham says:

    Can you tell them to improve their websites? Specifically, can you find the US Airways guy and kick him in the junk and then when he’s rolling around on the floor, tell him to fix his website. Its embarassing and completely unfunctional.

    I really like the CO site. My favorite ability is to see where my plane is coming from. And then see where it is before that, which is very helpful in the delay-prone Northeast.

    Oh, and if AA could offer free upgrades for Plat, that would be good too.

  15. asad says:

    Instead of worrying so much about yield per customer they need to start looking at the life time customer value. United has run their brand into the ground by charging customers every which way.

    They need to start looking at how Emirates, Singapore even Cathay treat their customers, how much do those airlines know about their customers vs United/AA. Maybe then instead of asking you what customers want they could ask their marketing department whose job it is to know what customers want.
    Hint it’s not more fees.

  16. Eric says:

    Build customer loyalty with contemporary service through value like in the old days, not through an illusion with frequent flier loyalty. There is nothing too big to fail if the company can’t adapt and change. Get rid of investors and consider In-N-Out as a business model, their burger is delicious, healthy and competitive in price.

  17. Eric (different one) says:

    Tell them to require a little more urgency in passinger boarding. That’s why most flights are late, and drives me nuts. SWA often prods people to sit quickly. I’ve noticed people moving quicker when there is a goal given (we need to be out of here in 10 mins or we lose our take off slot!). If that was said on every flight there would be a lot less delays!

  18. Eric (same one) says:

    Daily web specials like SWA’s Ding. Not just the weekly ones which are usually not that great, but something with low fares not seen all the time. I see AirTran has doing this alot lately. You could capacity control them and show how many are left. Fun!

  19. Bobber says:

    Ask UA to go back to marketing the FULL cost ticket on their website, not the pre-tax and fees that they currently do. It is a scam. And ask why some airlines penalize you for booking less than 7 days out, yet quite often you can find another airline who won’t.

  20. Simon says:

    Nothing should ever expire. There are people who only take one flight a year, but they always take your airline, and they should be rewarded for that.

    Empower your check in staff. It shouldn’t be possible for someone to turn up at DL First Class check in at JFK and then have to wait while the agent phones three people – and worse still, has to wait to get through to them – to enquire after a possible itinerary change.

  21. Paul says:

    1. Enforce the carry on lugagge size limits.
    2. UAL needs to do whatever is takes to increase morale in the workforce. Including taking $ from executives and giving bonuses to TAs, GAs, and FAs. This would go a long ways towards better customer service.

  22. Neil S says:

    If I fly 678 miles, you credit my account with 678 miles. But if I use 500 mile certificates to upgrade that flight, I have to give you two of them. How about making my mileage program membership card a debit card that lets me give you just the miles you need, rather than rounding up and stealing from me?

  23. Seattle Sleeples says:

    Get rid of the fees for booking award travel near the date of travel. I used to consider the primary benefit of accumulating miles to be the fact that I could decide to travel, redeem my miles and hop on the plane tomorrow, just like a real jet-setter, with no extra charges. Now to book award travel at the last minute can cost as much as a discounted fare.

  24. There are three large problems with the loyalty programs at the legacy carriers.

    Award availability, Award availability, and Award availability.

    I am a former elite at United and Delta and I gave up as their points are now valued at about 1 cent each or less because nothing is available at the “saver” rate. Continental is worse, American slightly better.

    I booked an award last week on Southwest, and it was easy with plenty of availability. Guess who I will go out of my way to fly with next?

    Finally, I have been repeatedly told point blank by United personnel that I am being treated differently (worse) because I am booked on an award seat. That is the ultimate “red line” that should never be crossed; the treatment, not the disclosure.

  25. Kevin says:

    I hate to say this but when it comes to changing plans, Southwest does it right. If you cancel, you don’t get your money back you just use your old confirmation number when booking another southwest (probably more expensive) ticket. You want to change a flight sure, just pay the difference between what you paid and today’s price. I do a lot of business traveling and my company is starting to require booking on Southwest to avoid hidden fees. Not a big Southwest fan, i prefer to know where i am sitting when i get on the plane.

  26. One more thing. Get rid of as many rules as possible. That is one of the beauties of Southwest’s system. I don’t need to read and analyze a 50 page membership guide that is constantly changing. In many cases, the customers know the rules better than the agents, especially the outsourced ones.

    Reward loyalty without creating a complex, ever changing, bureaucracy.

  27. A says:

    Here’s one for you Cranky….DITCH AWARDS PROGRAMS. I’ve been thinking about this one for a while now. Seriously, the guy that isn’t a frequent flyer but might want to take his wife on a nice trip is raked over the coals to buy up to a F class ticket. Why coach can be $200 but F is $4,000 is beyond me, especially when everyone up front didn’t pay for it anyway. Little tiny Sun Country Airlines lets people upgrade to F for a nominal fee, about $100/ticket and it works for them. Loyalty programs reward people who can game the system, i.e. $200 LAX-JFK flights, but alienate the masses. Thus, the majority get a bitter taste in their mouths while a select minority get all the upgrades, which I would bet aren’t always the most profitable customers. Note, I’m saying this as someone who was an elite member in many times in the past and enjoyed the free upgrades. I’d rather go back to a pre-deregulation enviroment w/no awards vs. the mess we’ve got now.

  28. Nothing new to add so I will restate some of the items mentioned.

    I agree with a couple of the comments regarding carry-on baggage. I think the airlines have it backward. Charge people who want to bring their bag on the plane, rather than check bags. Boarding is ridiculous wth the full loads and bags that have to be pulled from the cabins before take-off due to no capacity to store the pieces.

    The checked baggage fee has me traveling with my luggage on board all the time because I don’t want to pay $25 to check my single bag.

    The idea of offereing elite frequent fliers some ticket change coupons is one of the best new ideas mentioned here. I think this would be a popular frequent flyer enhancement. Most frequent fliers need to change a ticket at some point in the year and the ability to earn a few “Change your ticket for free” coupons would be a valued benefit.

  29. jonathan reed says:

    The ability to pay more for a roomier coach seat is a big plus. United’s E+ is great. For leisure travellers who are likely to fly as couples the availability of only two seats together rather 3 or 5 is what I look for. This makes me a fan of the 2+2 smaller jets or the old MD80s. If I fly coach I’m willing to pay somewhat extra to ameliorate the experience.

  30. David SFeastbay says:

    Grow up!

    Don’t think you have to do what the other guy does.

    Remind all your employees that ‘we’ the passenger pays their salary and not the union they belong to so treat us better.

    Here’s a novel idea, pay your bills by the fares you charge and not by how much ‘extra’ money you can get from people. Other businesses to that, why can’t you?

    Train your employees, it’s sad when the traveling public knows more about how to do the ‘airlines’ job then the employee doing it.

    This could go on and on, but I’ll stop now.

    Ok one more, I’m in the U.S.A. so make sure your call center employees are also. ‘Betty’ ‘Mary’ ‘Bob’ ‘Bill’ with Indian accents with other coworkers around them with Indian accents are not. If we can support you in this country you can support our needs with employees in this country.

  31. gsutiger2 says:

    EMPTYseats on flights = me leaving earlier or later on flights for NO FEE!!

  32. ScotS says:

    I agree with enforcing the carry-on baggage policies! Heck the idea of charging for the carry-ons instead of the checked baggage is a very good one. As one who travels between continents once a month and I can do so only with a backpack as a carryon, it frustrates me when I board a plane and there is no space for my small backpack in the overhead.

  33. pooke52 says:

    I am speaking for the little people who only get to fly on vacation or special trips and never get upgraded to first class. When we fly, we are considering all the fees the airlines have enforced on us along with the price of the ticket. We now don’t qualify for there member programs because we can never fly with the same airline. We also have to consider the fact that the airlines consider us lowly citizens. On top of this, the airlines have left or are dropping flights from our markets, so it is harder to get anywhere. It seems like we are to worry about there troubles. Are they worrying about ours?

  34. David Z says:

    Hi CF,

    To give maybe a “tangible” idea on many commenters about giving an “accurate” price, perhaps the airlines can look at Frontier Airlines’ site.

    Or if someone’s willing to, create a survey to gauge people’s responses. Then again, I doubt they’d be surprised at how many people feel about what they’re doing.

  35. Bob says:

    Since I am a “Million Miler” on two airlines, I have silver elite status for life on each. Therefore, why must I qualify for silver status each year before I start earning gold, and Platinum. It seems reasonable that the silver status miles each year should be a given, and I should start each year at that point. Otherwise, I have more incentive to fly another airline since the first 25,000 Elite miles earned will actually apply to achieving something helpful. And since I have earned Million Miler status, doesn’t that deserve more consideration than a gift for my efforts. This is my suggestion for improving Frequest Flyer programs.

  36. K says:

    Get rid of the bag fees.

  37. Shindig says:

    What to tell the airline honchos? How about sticking to their earlier offers for award mileage redemption? I had to take an early retirement so I’ll never make top-tier status again with only 4 within the U.S. roundtrips YTD. But I’d sure like to travel internationally at the current minimum redemption amount of 100K with the nearly 1 million miles I still have banked. Yeah, I can do it sometimes on AA but NEVER on DL where the majority of my miles are. That goes for all their Skymiles partners, too. Still, they continually extend offers to me for ways of acquiring more miles. I’ll never get enough though with their raising the minimums (80, then 90, then 100K) and then demanding at least double that, even when planning 330+ days ahead.

  38. CF says:

    Ok, thanks for all the feedback. I gave it to them today, so we’ll see what happens (nothing, I’d guess). I’ll write a summary post on what was said for next week.

  39. Hugh Jardonn says:

    D’oh! I’m too late, but I’d want to stress that checked bag fees need to be eliminated. Airlines must make a profit to stay in business; however I fail to understand the logic of nickel and diming the passenger with extra nuisance fees on top of the airfare. I’ve discussed this with my co-workers, friends, family and business associates, and there is a general consensus among us that airlines should charge one honest fare and eliminate the extra fees. I’m glad that Southwest agrees, and I hope they keep aggressively promoting the “No Hidden Fees” advertising.

  40. Ron says:

    Cranky, I tried to post a comment on this post last night but it didn’t come through. I think it’s because I included URLs in my post. It would be nice to get a meaningful error message rather than having the comment disappear into thin air…

    Can you post a video of your presentation?

    A few thoughts, even if they’re late (and with the URLs omitted).

    — Better award availability.

    — Better award search tools. You can tell how bad award search sucks from the fact that gurus can charge $150 for helping you book an award ticket, but only $30 for helping with a cash ticket :-)

    — Reasonable ways to use small amounts of miles, e.g. cash+miles programs that actually deliver value. El-Al does this successfully (only for trips originating in Israel), but with U.S. carriers, the cash+miles offers I’ve seen are no better than straight cash prices.

    — No de-promotions: if I signed up for a promotion and then a better one comes along, give me the newer one.

    — Better email newsletters. Read Jakob Nielsen’s alertbox post from October 31, 2005 (top hit on Google for “United Airlines deserves to go out of business”, with quotes). And don’t keep asking me to sign up for promotions I’ve already signed up for.

    — Actually, don’t require me to sign up for promotions at all. Do you think maybe I don’t want those double miles? Let me know I always get the best deal on earning miles, so I won’t feel compelled to always check your promotions — and those of the competition.

    — Reasonably priced day entry to lounges for elites. The $50 price tag is intended to keep the lounges exclusive. Well, if I’m an elite, let me feel like I’m not just anyone. Let me in for $15–20, and I may pay it.

    — No IT glitches. And when glitches do happen, have knowledgeable and empowered staff that can take reasonable corrective action. I managed to lose elite status in the middle of a trip, due to a technical problem with the Northwest/Delta account migration; I made a few comments about this on One Mile at a Time, on a post titled “Well done, Delta/Northwest!” from October 2, 2009 (since my last comment the situation has become even more ridiculous).

    — For non-urgent problems which don’t require back and forth negotiation or real-time search for availability, let me just send an email and receive a knowledgeable response in a reasonable time frame (24–48 hours).

  41. nealio says:

    I fully agree with the statement: Tell the truth. Declare it openly, warts and all. And then deliver on your declarations. And your customers will love you for it (cough) Delta. Stop the slick spin, we’re not dumb.

    I also agree with the idea of giving a few “change your ticket for free” passes every year, those same passes could be used for award redeposits or even bag waivers. Give loyal customers some flexability on that.

    Finally: Delta: bring back the mile high mojitos. Who decided to ground them just as they are reaching a cult following among elite fliers?

  42. myriam says:

    I totally agree re: “more reasonable ways to use small amounts of miles”. How about combining that with my earlier idea about having a few “change your ticket for free” passes, and if they want, they can do a “change your ticket for 500 miles” offer? I’d MUCH rather spend a few lousy miles to change a ticket than $100, especially since I can barely use my miles on anything else (which is another problem of course). It’d be better to get a few “no-change-fee” passes for FREE every year, but of course we all know they won’t give anything for free.

    How about spending miles for in-flight meals? Spending miles for lounge day-passes? Miles for the E+ seats? All this will reward customer loyalty and make you feel like you’re actually getting something for your efforts, especially since it’s increasingly difficult to actually get flights for all your miles (making the loyalty programs seem increasingly pointless). I love the “mileage debit card” idea.

    Lastly — just to be the sole person who disagrees, here : I actually don’t mind the bag fees at ALL. I think they’re a great way to raise money and keep my fares low. I travel about 30,000-35,000 miles a year and rarely, if ever, check a bag; on top of that, I have never — not once — not been able to fit my carry-on onto the plane. Yes, I get a bit tired of the slow people with roller-board bags who refuse to just PICK THEM UP AND WALK FASTER WITH THEM, but otherwise, I’d prefer to have the savings on my ticket and build up those biceps carrying the overnighter around everywhere. The few times I need to check a bag, it’s for a specific reason, and I’m fine with $20 extra bucks here or there.

    Don’t mean to be argumentative — to each his own — I only wanted to express a differing opinion on that.

  43. Chris says:

    1. To be able to use additional miles to pay the copays for miles upgrades instead of cash

    2. To allow more transparency in airline data like award and upgrade inventories.

  44. Jeff says:

    I hate airlines nickel and diming us for everything… Bag fees are a real crock. You are paying enough for the ticket already. Obviously if you travel, you need luggage. Luggage weights went down on many airlines a few years back, so they could charge for overweight luggage easier. Then came the fees. Your not-so-cheap airfare should include two bags just like it used to! By God, it should also include FREE food on flights over 2.5 hours in length. Deregulation worked at the beginning, but now with less competition, it doesn’t work so well. Several times I’ve seen airline employees using their federally-sanctioned power to threaten passengers hampered by airline-caused problems. I saw a gate agent almost break a man’s hand by slamming the door on him about a year ago, then threatening to have him arrested, after trying to board a couple minutes late because of weather delays. I hate government intervention in everything, but they me be the only ones who can stop the abuses.

    Flying used to be fun. Now it’s become martyrdom. Airlines have lost their civility.

  45. too bad i did not see this post till now, but if you do get another chance at it, i’d like to amplify the following:

    1 – surprised fees
    2 – checked baggage fees
    3 – ff programs not to expire
    4 – more mileage sharing options
    5 – better food selection in first class (we pay for it!!!)

  46. I have to agree with you sallysue.

  47. I would have to agree with you sally

  48. JUAN says:

    AA needs to be competitive on pricing with other airlines. They cannot justify a 50% premium over the competition on the same dates-same routes.
    I don’t know if its like this to all cities they servel but I just checked out flights to HSV, MSN, MKE, DFW, ORD and SJU and the cost difference was over 40% every time.
    Revenue growth is great but customers will notice and change to other airlines.
    Tell AA to wake up. Balancing market share and revenue growth is critical.

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