RealDLInsider

Looks like my last post around SkyChoice got a number of replies and was a healthy debate. In the spirit of moving on however, I’ve heard all of you loud and clear, and will commit to continue to monitor the situation, award availability and will make adjustments as necessary. Also appreciate the feedback and "grades" around my performance this year. As we move into 2008 however, I wanted to make a couple comments that I think are important to our loyalty program, and ask for your candid thoughts around one fairly high-profile issue.

Greater utility of mileage currency and improved transparency in where award seats are, and when they are allocated, is important for 2008 ….

Specifically, during 2008, I believe it is fundamentally important that airline loyalty programs and even the rewards programs of major credit cards continue to offer greater choice and utility in the “use” of frequent flyer miles. As the number of miles being given away and specifically sold continues to increase at very strong rates, loyalty programs in general must provide greater utility in the currency. This is a strong belief of mine, and one that Delta will commit to during 2008.

In addition to greater mileage utility, it’s even more important that we provide greater transparency into when and where award seats are available. Over the last several years, many airlines have added multiple partners which provide additional access to award seats, but calls to our reservations staff and technology (search tools) to find these award seats are inadequate and result in very lengthy talk times. One of our goals is to provide greater transparency and awareness of where award seats are and provide to each customer not just transparency, but the ability to pick and choose when they want to fly and at various mileage rates. This is yet one more thing Delta will commit to during 2008.

In Summary: In 2008, you will see greater mileage utility at Delta for all customers, more choices and more transparency in finding hard-earned award seats

Something to Ponder: Consolidation is all over the media, on the minds of airline investors, and in turn, discussions are likely being had with various airlines. Just to be clear, I’m not aware of discussions nor am I a part of any that may or may not be happening. However, as I think through what could happen in 2008, I wonder how two airlines might design any type of consolidated loyalty program. Specifically, with rumors of United and Delta, or scenarios that could put Northwest and Delta, or Continental and Delta together, what might be the good and bad that you keep in a consolidated program. For example, in a world of United/Delta, do you charge or not charge for upgrades? It’s easy to say that you would not want to from a customer perspective, but what about the number of elites and the ability to additional revenue off of discounted fares? Do you have three tiers (one at 75K or one at 100K), or do you have four tiers? Or better yet, do you have a tier at 150K, since a larger airline with a bigger network could make it easier to earn miles. What co-brand card offering is the best? Would you prefer to have two co-brand card options – an AMEX and a VISA/MC option? In a Delta-Northwest or Delta-Continental program, with the loyalty programs already fairly similar, do you keep them the same or do you adjust them? In what ways? Is UA, DL, NW and CO currency equivalent and would you simply just consolidate them into a 1:1 point transfer?

Again – not something that we’ll for sure have to deal with in 2008, but in the event we do, initial feedback would be great. Sorry so open ended, but just a few things I ponder while out on holiday.

Til next year, I hope you all have a great holiday and New Year’s eve and day! Since my Fighting Irish aren’t playing, bowl games just aren’t all that exciting this year. Sorry you LSU and OSU fans!

Jeff

Beckles

This should be Priority 1+ if you ask me. Right now I feel like my miles are stranded in Delta it's so hard to find award seats, and while the design of your new website should theoretically make it better, when I search for an award I've found that the calendar will show SkySaver as available, yet when you go that date only SkyChoice is highlighted as the least expensive option, leaving me scratching my head.

I think NWA's new award booking tool is very good, especially at searching multiple partners, you should be looking long and hard at that and trying to do one better (i.e., including even more partners than they do).

AndyTLe

Sorry for being a Fighting Irish fan. I wouldn't wish the year they had on anybody.

Mergers, consolidations, buyouts... whatever term you use will ALWAYS cause attrition by employees and customers. Whether it is because of increasing efficiency or combining resources (i.e. DL/UA - dehubbing SLC, keeping DEN, dehubbing CVG, keeping ORD). Customers will jump ship either way. Obviously minimizing the rate of loss is crucial.

A DL/UA combination over DL & another SkyTeam partner obviously makes the SkyMiles program much more difficult to integrate since DL & UA have vastly different programs. I would think, in solely ff program terms, DL & NW or CO would be much easier. SkyTeam elites are used to free upgrades and that is a benefit that differeniates ST from *A or oneworld. As a PM that is dropping down in DL (moving business elsewhere), I would find it hard to swallow paying for upgrades unless there is some other GIVEBACK from the "new" airline. How does the "consolidation" benefit me?

Points: 1:1 will be fine IF the awards are going to "cost" the same. If you bump a domestic skysaver to 50,000 miles. Transfer points should increase accordingly.

Tiers: 3 tiers are fine if the highest is at 100K. If you have a 4th tier: DEFINE how to obtain it. None of this hogwash. Make it transparent.

Credit card: AMEX is the best card for travel. I have 2 AMEX cards and 3-4 Visas. I default to my AMEX unless I can't.

The new airline has A LOT more to worry about than just the FF program. Focus on keeping the customers AND employees happy. LEARN from the mess that is HP and US. Don't be stupid about it, change will ALWAYS upset some but when necessary, it is better to do it right than trying to apease all.

And to be a party pooper... with a merger what would happen to our FT board, would we have to merge too? Jeff's job, would it no longer be necessary?

Happy New Year...

keeton

"Consolidated loyalty" is an oxymoron. At that point, frequent flyer programs are just another form of Green Stamps. There is no reason to fly on a particular airline since you can earn on one and burn on another.

The same goes for elite perks. If I have channeled my business to Delta (which I have) in order to become an elite flyer, it is not fair to have the benefits distorted by members from a larger or smaller airline flooding (or getting flooded, respectively) the system.

If two airlines actually merge, then you can deal with the new company's frequent flyer program as a single entity and can mine the data to come up with the appropriate elite tiers/perks.

cynicalflyer

Thank you for posting and posting so quickly after the last one at that.

Not a single word about "givebacks", but then again, you never did promise that, did you?

Oh well. Change the subject quick I guess.

Spiff

Thanks for sharing, RealDLInsider!

I know there are several of us who exceeded 75k MQM or even 100k MQM and were not "targeted" for promotions for doing so. I hope that 2008 will bring an end to these selective rewards and give all of us who significantly exceed qualification thresholds an incentive not to fly other carriers.

As for Bowl games, there's a perfectly good Independence Bowl in two days (Go Buffs!) and a great Sugar Bowl (Go Warriors!) on New Year's Day.

AndyTLe

Mods... please merge both threads.

Flying_Duck

I also feel my miles are stranded for now. I have never had this high a balance (>1M) and while my ticket purchase patterns makes for me being less "emotionally" engaged in the current SKYCHOICE/SKYSAVER award debackle, I do notice that seats and travels that were readily available in previous years, by-and-large have been unavailable the past year (such as getting award seats for family and friends as I did much of before). I still have not adjusted my internal calculator to accept SKYCHOICE spending - but the day may come! Spending devaluated miles on hardware to the tune of < 1 cent per mile or any similar devaluation outside award seats is totally uninteresting for me.

Whatever happens in 2008, what I would like to see more of, and what would definitely get my interest in taking back some of the premium business I have taken to other airlines in the past 1-2 years are perks that differentiate more between the elite levels. The "platinum exception" 1 or 2 years ago was a wonderful reminder as to why it is important to stay with DL, the ability to book in F (if available) for, if not K+ fares, then M+ fares, (that were reasonable) were wonderful perks that tied me with super-glue to DL. Instead, we saw not only devaluation or disappearance of these perks, but "equal treatment" across FO, GM and PM which never made sense to me. Yes, you may benefit from an FO booking in "Y" and therefore treat him/her the same as a PM, but the PM will travel Xmany more than the FO, and probably has more wiggleroom in looking elsewhere - so again, I don't get why each level, except for a few things (e.g. PMU's, longer upgrade window) are receiving the same perks despite the increasing difficulty and loyalty needed to get to the higher level.

I have no problems to pay to add to the upgrade certs I get for miles flown (because that would be maintained, right?), which is a change from when I adamantly aregued against that when DL temporarily planned to do so a couple of years ago. As long as the price is within reach for salary earners flying a lot and as long as there is a marked difference in certs allocated between the different levels.

After having flown > 200,000 MQM's when the perks were the highest, I now fly half that on DL, putting many of my longer, premium travels on other carriers because I still get the upgrades for the shorter flights on DL by maintaining PM and there is nothing in it for me for the longer flights which I always fly in premium, no matter what it takes (my last trip in coach TA was in 1988!!), especially it is no longer attractive for me to hoard more miles than what I have, they have turned into - just numbers!.

DL could get all my business back, but it needs to make it worth my while. Throw some for DL relative inexpensive bones to me, and I will come back with a wagging tail, such as the ability to be confirmed in the F cabin on any Y fare (as long as there is a seat avaialble - the price difference to F/A is usually trivial anyway - but because of many large-company travel policies, it is important to be able to purchase a "coach ticket" regardless of price), confirm in F-cabin at purchase of B,M fares if V inventory is available, "Platinum exceptions" (1 for GM, 2 for PM/y) to Skysaver awards, day-passes to the CRC that are transferable, use of PMU's on Intnl. K+ fares, ability to transfer PMU's to family, to mention a few of the kind of bones that will bring all my business back to DL.

Oh, and when merging with United: Make sure RCC's serve free booze!!.

Cheers and good wishes for 2008 for DL and it's FF's.

ecaarch

Jeff, as always, thanks for posting. We may agree with you, we may disagree with you, but that fact that you at least read what we write is a positive for both DL and us. Maybe we are cheap market research to you and DL, but who cares, as long as we are heard.

KeaauFlyer

As someone who as already voted with my dollars and moved my business elsewhere, I will comment with a bent toward things that might eventually bring me back.

1. Bringing back the 331 day availability factor would do a lot for me and lot of others. Some of us HAVE to plan far ahead for vacations, family reunions, etc. The end of 331 was a big deal.

2. Fix the delta.com award calendar! I won't go into all the well documented glitches that routinely occur, but will just say that they raise the level of frustration considerably. The cliche "insult to injury" comes to mind.

3. You don't specifically mention bringing back SkyChoice, but it is a make or break issue for a number of your elites. I think DL greatly underestimated the value of SkyChoice as a customer retention factor.

Consolidation issues:

As far as mileage valuations in potential merger, a 1:1 would work in nearly all cases, as long as a merger is not used as cover for yet another devaluation. DL will have a bigger worry convincing your die-hard loyalists that their level of personnel interface satisfaction will not plummet in a merged company. I have NOT personally found this to be as big a loss in my change of airlines as I had thought, though. Having a Visa/MC credit card option would be good since Amex is not accepted in quite a few places.

One last thing. If one of your stated goals is transparency, make the criteria for the highest elite level absolutely clear and concrete. I personally would never make it to that level, but it does not set well with a lot of high-tier customers when they don't know what they have to do to get to the top of the system. "Fly like crazy and charge your Amex like cracy, and we MIGHT elevate you," is almost insulting.

Thanks for eliciting input. You'll probably get a lot. Now we will see how DL acts on it.

RobertS975

In terms of consolidation, I believe that in the past, the surviving airline recognized the absorbed airline's FF program at a 1:1 basis. As far as whether the newly merged program would need adjusting, I am puzzled by the fact that you have posed this as a question to us! You guys are always adjusting the program anyway, so why would we ever assume that there would not be some more "adjustments" after a merger of two (or more) carriers?

As far as how many tiers, you already have info that we can only guess about... how many PMs there are, how many GMs there are and so forth. And even more important, what is the proportion of your revenue derived from PMs as a group, GMs as a group etc.

This may sound crazy, but I believe that some effort should be made to identify "source" medallions, and definition of which would be medallions who not only direct their own travel, but those of their family members or associates as well. For example, I have booked as many as 5 family members at a time on an paid international BE itinerary... now each got the mileage credited to their own accounts, but in the realm of things, there should or ought to be some recognition of the "source" of the booking. Keeping the "sources" happy is important in this day where we can earn MQMs on so many other carriers.

PhillyPhlyer40

I would like to chime in here as a "part time" DL customer. Previous CP with US, and current PLAT/CO* with CO.

I LEFT US due to the botched merger. No more "wait until next quarter" for me! I have found a home at CO. In the meantime, I tried NW/DL/CO/UA/AA, and found that I would be happiest with CO.

For me, most of my flying is NYC-ATL/ORD/Florida/east coast, with a few LAX/SFO's thrown in. The BIGGEST thing that turned me off about DL-NO SEGMENTS! DL needs to realize that we all dont fly ATL-Europe! BUT...my ticket spend flying east coast is probably 3-10 TIMES what others flying transatlantic is! I average about $900 one way for FULL Y fares. DL is not very accomodating with this, due to no EQP's/EQS's.

I do remain premier with UA and will be 1K. I agree that if you have a 4th level-aka 150K/150segments, make it KNOWN, with DEFINED benefits. As a CO*, I get VERY little. Why not make it a KNOWN level, and TELL the AGENTS to take care of the customers.

I also do not like the fact that ATL-EWR does not get meals. Why cant DL provide a competitive product to CO on this route. When rushing from all day meetings to make a 530pm flight, the last thing I have time for is a meal, yet CO seems to feed me on the plane every time!


As far as upgrades, I feel a "pay" instrument is fine. Just make it reasonable. Less then the current $50/500 miler from UA. More along the lines of $30/500 (ala AA) and give out 500's with 10K flown OR 10 EQP's!

cynicalflyer

155 as of now, making it the 11th most replied to post currently on. “A number of replies” indeed.

Moreover, a debate implies a two way discussion. Oh wait, it doesn’t imply it, it defines it. This wasn’t a debate. This was a post you made in which FTers then deconstructed your words, analyzed the situation, raised a variety of points and numerous questions. You in no way answered or responded to any of it, then or now. If that is a “debate”, screaming at a brick wall would be the second-coming of the Lincoln-Douglas debates.

You want a debate? Here's an Oxford-style one: Resolved: This House finds there is no give back.

You just won’t answer any questions or discuss any of the points raised. See the aforementioned “debate” with a brick wall.

Let’s have a debate right now, loud and clear: Where’s the give back again?

Where’s the give back again? How about adjusting that?

In other words, as you quickly change the subject as fast as you can without addressing any of the points made to your prior post.

As you move on, the question remains: Where’s the give back again? It’ll be the same in 2008 as well.

Sure, we’ll comment. We can apparently comment to a stone for all the response it gets.

Here’s a question rather than a comment that is “important to our loyalty program”: Where’s the give back again?

Ah yes, inflation by issuance of far too many miles. The problem is not the utility of the miles alone, but it is also coupled to their value! Throwing out scads and heaps of miles devalues the miles and makes them at the same time less useful as everyone has miles and tries to redeem them. Add to this that the redemption opportunities just got slashed with the SkyChoice debacle, and it is a recipe for disaster.

And the decision to use the word “choice” here? Irony overload. Delta just cut “choice” and now you want to trumpet it.

Here’s a utilitarian question. Jeremy Bentham, founder of modern utilitarianism said "nature has placed mankind under the governance of two sovereign masters, pain and pleasure." So as for utility, I hate to be a pain, but would you do me the pleasure of telling me and everyone else (Mills on utilitarianism: greatest good for the greatest number) Where’s the give back again?

Going to be much easier now that SkyChoice is cut to ribbons. The when and where is now “never” and “nowhere.”

Hey, want to start 2008 with transparency? Cool. Answer the question: where’s the give back again?

Again, thanks to messing with SkyChoice and forcing all those who were going to take that to now compete and swallow up more SkySaver seats, those calls are going to be much shorter:

Customer: “How about…”
Res Agent: “No.”
Customer: “Ok, then can you look at…”
Res Agent: “No good there, either”
Customer: (hangs phone up in disgust)

Is there a new search tool that will tell us where the give back is?

See aforementioned “never” and “nowhere”.

How’s this for awareness: I am unaware of where the give back is. Do you know where it is?

In Summary: We here at Delta are going to make it easier for you to realize your lack of choice and availability in a much simpler fashion. With technology. And search engines. Now, you’ll be able to graphically see just exactly how little availability there is without the 331 day window and with the conversion of SkyChoice into SkyNever.

Here’s something very utile, for all customers: Where’s the give back again?

[Loose translation: Quick! Quick! Look over there! Pay no attention to the lack of choice or availability behind the curtain]

As you are pondering, can you ponder where the give back is again?

I see someone had a chat with their GC after they declared that A fares are in fact first class and not coach. Clearing statements through legal counsel is always a good thing. And the SEC’s been real twitchy lately.

Just to be clear, I’m not aware of discussions nor am I a part of any that may or may not be happening with regard to where the give back is. Care to help me find it?

You know, hypothetical airlines that might merge or something. Let’s call them, oh, I don’t know Atled and Detinu?

And I think through what could happen if you told us where’s the give back was again?

Bad: Execs who come onto boards promising not “significant” changes to a major component of the “consolidated program”, said changes been substantial. Vague allusions to givebacks that never materialize.

Speaking of things that might keep me in a consolidated program: where’s the give back again? That may or may not keep me.

Here, quick, let’s throw out 8 new questions rather than answer the ones posed to you by people replying to your previous post.

Like this one: Where’s the give back again?

It seems the give back is “not something that we’ll for sure have to deal with in 2008.” How about you tell us and deal with it in 2007: Where’s the give back again?

You know what I ponder? Of course you do, I’ve pondered it all over this post: Where’s the give back again?

Thanks. You as well. And here’s a new/old song

Should old allusions to give backs be forgot,
and never brought to mind ?
Should old allusions to give backs be forgot,
and auld lang syne ?

Not too catchy, I admit. So how about the original version: Where’s the give back again?

Well, with all that spare time you got for not watching bowl games, maybe you could take some and answer: Where’s the give back again?

CynicalWhere’s the give back again?flyer

amanuensis

Jeff, I completely agree with you that greater utility is needed for FF miles. The program that really worked for me in providing utility to my SkyMiles was the two-way conversion of SkyMiles to and from Hilton Hotel's Hhonors points. If that program could be reinstated, I would be a happy camper.

Regarding merger options, I very much hope that no merger with United takes place because it seems inevitable that in such a scenario that your SLC hub would be downgraded significantly -- possibly it would no longer even be a "focus" city. If the new airline was to only fly from SLC to UnitedDelta hubs in Chicago, Denver, and Atlanta then my choice of which airline to fly on would become wide open. And I think Continental would be getting the lion's share.

Based on route structure, the only Delta merger that makes much sense to me is Delta and Northwest. Regarding WorldPerks, my advice would be to keep the two systems operating parallel while all of the bugs are worked out of whatever you decide to do -- don't merge the miles too soon. But then when you do merge, MERGE! Avoid at all costs making Old Miles/New Miles differentiations that you eventually become unable to sustain. A lot of posters on this board are still upset that you folded their Old Miles into their SkyMiles balances.

Loran

Thank you Jeff for another informative post.

As someone who has had the good fortune over the last year to book two award trips in F on Singapore Airlines I've had first-hand experience with the long talk times. I've chatted with several of the reservation agents about this while I've waited, and not only do they find it frustrating to do a flight-by-flight search, some of their customers are not very patient. The longer phone calls also obviously cost DL money.

On the other hand, I would argue that SQ is the premier SkyMiles partner, particularly for Asia flights and for the premium cabins. The ability to use SkyMiles for an F or J award on SQ is a huge benefit of the program, and, in my mind, a long time on the phone is a small price to pay for the great final product.

Some agents mentioned to me that DL is in negotiations with SQ regarding the partnership, and the suboptimal computer interface/flight searching is a major issue. While we're all in favor of quicker searches of SQ's award inventory, I do feel that they offer a product not otherwise found within SkyTeam, and they should remain a DL partner even if the transparency goal can't be quickly met.

Thanks!