RealDLInsider

All,

Thanks much for the feedback around the highs and lows of the Delta product, and not surprisingly, your comments were shared broadly within Delta. We also saw the unanimous vote for internet access in the Crown Room Club. This research will be used by the Crown Room Club team, as they look to improve the overall club experience. Specifically around the highs and lows of the airline, the positive feedback around employee attitudes, in particular our flight attendants, has been shared. We have invested heavily in training our front-line employees over the past 12 months, and your feedback and recent research suggests the service levels both at the airport and onboard have dramatically improved. Two of the weaknesses you mentioned, Delta Connection and Baggage, are focus areas during 2007 and I expect significant progress to be made in these areas.

It’s been a couple weeks since my last posting, and I apologize for the delay. I was on vacation a good chunk of the last couple weeks, and have been traveling all over North America this week. I attended the Frequent Flyer conference in Vancouver over the last couple days, where I met with several of my airline counterparts, as well as several hotel and car rental travel partners. It’s amazing no matter what the size of a company (air, car or hotel), how similar the issues are that we all face.

Upgrade Notification Clarification

There was some confusion around this over the past few weeks, and the team wanted to make sure you all had the specifics. When notifying, we will not call members between 9 p.m. and 9 a.m. local time. Also, based on past experience and feedback with schedule change calls, we won’t call on Sundays, unless it is for a flight departing within 3 days. As such, upgrades that clear on a Sunday for travel more than 3 days out will be notified on Monday. Email notifications are sent 24 hours a day and 7 days a week.

Award Seat Calendar Search

Just got an unfortunate update around award calendar functionality and due to an issue on the “searching” page, we had to pull the new system down temporarily. A large team of people are working on the fix tonight and tomorrow, and we expect to have the new functionality back on line soon. Sorry for giving some of you a taste and then pulling back. All of the testing was working beautifully over the past few weeks, and we really thought we had it right today. Sorry gang.

Broader Award Seat Availability

Award seat availability is a complaint area around the SkyMiles Program that many of us internally would love to do something about. The launching of award combinability in December, and today’s launch of award calendar search functionality on delta.com, are two initiatives that we were planning for a while to help address some of these issues. They are not obviously the silver bullet or a long-term solution. Some facts -- data suggests that our Medallions are getting better access to award seats, with Platinum Medallions having the greatest success. There is also confusion by many customers as to the difference in SkySaver awards and SkyChoice, and what type of availability SkyChoice offers. Just opening up more SkySaver award seats to customers without guaranteeing upside will be difficult for any airline, and was a topic of extensive conversation at the recent FFP conference.

So here’s the issue and major questions:

If you were in charge of one of the major airline loyalty programs in our country, and were tasked with creating a vision for what airlines should do longer term to strike a balance between award redemption and the earning of miles – what would you do? Something to consider – is this really about opening up more award burn, or is there a problem in how many miles we give away on the earn side? Secondly, is how we give away miles today on flights done appropriately or is it over-awarding lower fares and under-awarding higher fares? And – is a mileage based program where the airlines should stay, or should we consider launching a revenue based accrual and rewards program that gives out a similar number of miles but allocates them better to customers based on revenue?

Your feedback on this issue and these questions will help guide us as we continue to investigate what we do next in the short and long-term around this complex issue.

Saw some other issues you all had in the past week or so, but with me traveling around the country this week, I couldn't address all of them.

'til next week ...

Jeff

jackplum

Interesting concepts presented here! I look forward to seeing the input. Thanks, Jeff.

iCorpRoadie

Thank you for the post Jeff. Per your question, I feel that it is fine just as things are. There are airlines that give miles for EVERYTHING and those count as MQM/Segment miles, but I feel that that would devalue the FF Program with an overwhelming number of Plat/Gold/Silver.

I haven't had a real problem using my miles in the past few years. I was able to get a last min sky saver seat two weeks ago for 25,000 miles.

As per the revenue/price per ticket side, for one that flies DL personally and for business, most of my clients would rather put me on another LCC that costs less to fly me places, but my loyalty lies with Delta.

I know this is off topic but how many people do have problems booking award tickets? It's all about being flexible on time/date as after all it is basically a FREE ticket.

longing4piedmont

First of all I've never had a problem using my miles (skysaver) so I don't consider it your major issue.

With that said, and I doubt you will agree given the financial considerations, but I think the miles should be earned with your butt in the seat and NO other way with the possible exception of A credit card. All the other ways just dilute the availability for those who are loyal and do fly DL.

To your second question on revenue based system, I'm in favor of it if an equitable solution can be found. However we all know that some markets have higher fares when one looks at the RASM. Fare codes mean nothing. A 500 mile flight from CLT might be twice as much as MCO when compared to RASM. BHM may be twice as much as CLT for the same amount of seat miles. In this case someone flying out of a cheaper city will be at a disadvantage.

Fare codes don't work either. Seldom do I have the chance to book A fare flights out of the airports I fly out of or into. They simply do not exist. However I may pay twice as much for the K fare as some one else booking an A fare for the same amount of seat miles. (just pull up my $1,300 ticket for tomorrow to see what I mean) Do you really want the market we fly out of to determine how many MQM's we earn?

I will tell you now that after taking the miles given from 750 to 500 and other factors I saw a 33% harder time qualifying for PM. If you are considering going back to half credit on the LUT fares, you WILL lose me as a customer.

As I've told you before, I don't fly DL because of the Skymiles program. I fly DL in spite of it...... I don't mean that to be as harsh as it sounds, but that is the bottom line.

NHFL9

I've never had a problem using SkySaver either. I really like Delta's online redemption system.

BOISJC744

The only major problem with award availability that I see currently is the whole flap over award travel to Russia.

kniksefat

Personally, I like the fact that all fares earn full MQMs/Miles with Delta. I feel like other airlines are nickel and diming me with the reduced earning potential.

Lehava

I second longings comment, there are tooooo many ways to get miles that have NOTHING to do with having your butt on a plane. You can get miles for sneezing these days. And I know you were trying to keep customers happy with giving them all the ways to reinstate what they lost with the expiration change, but IMHO you basically defeated the whole purpose of why you moved the expiration up. You were trying to get miles off the books from people who were sitting on them and not having any DL activity, then you turned around and put them back on the books. Seems really stupid to me to be honest.

Jeff my bottom line.....you are no longer running a frequent flyer program when you reward so many things that have NOTHING to do with flying. You are running a people who like Delta free award tickets program!!!!!! I can gain free awardt tickets by staying at a Hilton, buying flowers and eating out. Great, but how does that help Delta???? Bring the program back to being about FREQUENT FLYING (not expensive flying, FREQUENT flying)

BOISJC744

I heartily agree with kniksefat. The 50% mqm is one of the most annoying parts of modern ff programs, and I am glad to see that Delta fares all give 100%+ mqm.

Spiff

I left when MQMs dropped below 100% for cheap fares. I'm glad Delta saw the error of its ways.

If it's too hard to redeem awards (and I have had pretty good success), then the issue is the billions of FF miles that are handed out for non-flying activity like getting a library card or correctly spelling 'cat'.

I really wish partner awards were available online since that is what I redeem the majority of my miles on.

tarmacsitting

First, thank you for the updates in the first part of the post. Communication from a company to it's customers (even bad news) is ALWAYS a good thing.

Second, regarding the awarding of miles, any program that reduces miles (actual or bonus) for miles actually flown, is a bad idea. If a person is buying a discounted ticket for first or coach they are due the same number of miles as someone who pays more for the same seat. The airline industry does nothing to differentiate service for $$ paid, so rewards should also not be contingent on $$ paid. Making award seats available based on the value of the customer's business to the airline (i.e. easier access to skysaver for PM vs other levels) is fair game, but the number of miles awarded for a flight is not. You can give, but you cannot take away. (Please refer to a former upgrade policy for LUT fares.) Given that Delta earns revenue for non-traveled miles awarded by third parties, reducing the miles awarded in any capacity seems like an ill advised idea, strategically speaking.

Third, do you have numbers to support that more customers chose DL or any other airline based on award availability? Are customers truly defecting to Airtran because of their reward flight availability? Is the once a year traveler really basing their purchase decision on award availability? (dubious) For those of us on this board, and some (not all) of us are hoarding hundreds of thousands or millions of unused miles, might service improvements be more important? Please note the many discussions on Delta's substandard first class product and the numbers of us who can't yet always procure private travel, but when given a choice choose AA or CO over DL for our premium fare travel.

diamedic

PLEASE PLEASE PLEASE - do not go back to the system that provides ANY fare purchased with less than 100% MQMs.

jackplum

I also have never had a problem with Skysaver including TATL B/E. However, if there are projected empty seats on a flight, would it not benefit DL to open those up through increased loyalty?

I also concur with earning through flying with the exception of credit cards. DL gives the rewards to those who have earned them in some sort of revenue model that benefits DL. I have no problem with that. Personally, I earn more miles than I can use at this point.

I think the earning model is appropriate and balanced though the 25/100/100 percent medallion bonus for FO/GM/PM has always seemed unfair to me. I would like to see a 50/100/150. More incentive at the low end and greater reward at the upper end.

I really do not think a revenue based reward system would benefit users or DL with so much variablity in fares and fare matching against competitors. At this time, one can plan out mileage earning with reliability. Without a fixed fare structure (hardly practical), I doubt that one would have no means of predicting mileage earning with any sense of accuracy.

Thanks for soliciting such valued input.

MikeMpls

Not practical -- frequent flyer programs are profit centers in themselves.

Miles awarded for travel don't bring in any added revenue. Miles awarded for partner activites are paid for in cold, hard cash from the partners.

mikey1003

This is exactly what we discussed with Robby Boy Borden, Et Al. years ago.

This is exactly what stated the SSM movement several years ago