Article: United Airlines makes plea to win back straying business travelers
Jan 28, 2013, 4:23 pm
#1
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Article: United Airlines makes plea to win back straying business travelers
http://skift.com/2013/01/24/united-a...ess-travelers/
Not much in the way of details for rank-and-file FT flyers other than they are planning bonuses for corporate contracts. I assume that means corporate planners get a benefit for continuing to shovel business UA's way, regardless of service levels improving.
Is it going to be too little, too late?
As United Airlines officials discussed fourth quarter financial results with skeptical analysts today, they pleaded with corporate accounts to return to the fold, arguing that the airline has left its operational woes of the summer in the rear-view mirror.
That invitation occurred as the airline revealed it trimmed its senior officer ranks by 7% in December, and plans to reduce management and administrative staff by 6% starting in February.
As United Airlines officials discussed fourth quarter financial results with skeptical analysts today, they pleaded with corporate accounts to return to the fold, arguing that the airline has left its operational woes of the summer in the rear-view mirror.
That invitation occurred as the airline revealed it trimmed its senior officer ranks by 7% in December, and plans to reduce management and administrative staff by 6% starting in February.
Jan 28, 2013, 4:30 pm
#3
Join Date: Jun 2005
Posts: 4,645
http://skift.com/2013/01/24/united-a...ess-travelers/
Not much in the way of details for rank-and-file FT flyers other than they are planning bonuses for corporate contracts. I assume that means corporate planners get a benefit for continuing to shovel business UA's way, regardless of service levels improving.
Not much in the way of details for rank-and-file FT flyers other than they are planning bonuses for corporate contracts. I assume that means corporate planners get a benefit for continuing to shovel business UA's way, regardless of service levels improving.
True, on-time performance and cancellations improved from the horrific lows of the summer, and maybe bag losses are down from similar horrific lows as well, but SHARES is still a total disaster and I've had hardly a segment, much less an itinerary, that wasn't messed up in some way, by some combination of SHARES failures, IRROPs, or incompetent staff in as long as I can remember.
Are they clueless or are they lying when they say that the problems are behind them?
Jan 28, 2013, 4:51 pm
#4
Join Date: May 2009
Location: PHL
Posts: 2,842
Not sure how corp contract bonuses help with big firms. My firm has thousands of employees in the US who can choose to fly a number of airlines with our firm negotiated rates. Giving some type of bonus to a rate negotiator is not going to make me any more or less likely to book with UA.
Jan 28, 2013, 4:58 pm
#6
Moderator: United Airlines
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Not sure how corp contract bonuses help with big firms. My firm has thousands of employees in the US who can choose to fly a number of airlines with our firm negotiated rates. Giving some type of bonus to a rate negotiator is not going to make me any more or less likely to book with UA.
But others are like yours.
Jan 28, 2013, 5:16 pm
#7
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They keep saying that this is behind them, but it's not.
True, on-time performance and cancellations improved from the horrific lows of the summer, and maybe bag losses are down from similar horrific lows as well, but SHARES is still a total disaster and I've had hardly a segment, much less an itinerary, that wasn't messed up in some way, by some combination of SHARES failures, IRROPs, or incompetent staff in as long as I can remember.
Are they clueless or are they lying when they say that the problems are behind them?
True, on-time performance and cancellations improved from the horrific lows of the summer, and maybe bag losses are down from similar horrific lows as well, but SHARES is still a total disaster and I've had hardly a segment, much less an itinerary, that wasn't messed up in some way, by some combination of SHARES failures, IRROPs, or incompetent staff in as long as I can remember.
Are they clueless or are they lying when they say that the problems are behind them?
This piece shows what the call did, they don't have a plan. No idea how to get back HVFs and while they evidently intend to try to use their sales force to push "network" (and it sounds discounts) to "corporate accounts" I don't see any plan, or even an acknowledgement that they also have to win back HVFs who are not tied to corporate accounts.
And discounting existing corporate accounts will not help their yields either...
As BofA said on Friday, stock is going to $22 a share (or lower).
Jan 28, 2013, 5:19 pm
#8
Join Date: Sep 2008
Location: SF Bay Area
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I bet AA would respond with a similar offer, actually I wouldn't be surprised to see another round of match offers from AA regardless at some point this year. UA seems unwilling to listen to its customers and there is still lingering discontent because of TOD's, govt upgrades ahead of 1K's, horrible irrop performance, reduction of million miler benfits; what else?
Jan 28, 2013, 5:24 pm
#9
Join Date: Jun 2005
Posts: 4,645
Mitchmu. Don't dog SHARES, by using it COdbaUA saved $22M a quarter in payments for Apollo. Those savings add up to... well maybe not...
This piece shows what the call did, they don't have a plan. No idea how to get back HVFs and while they evidently intend to try to use their sales force to push "network" (and it sounds discounts) to "corporate accounts" I don't see any plan, or even an acknowledgement that they also have to win back HVFs who are not tied to corporate accounts.
And discounting existing corporate accounts will not help their yields either...
As BofA said on Friday, stock is going to $22 a share (or lower).
This piece shows what the call did, they don't have a plan. No idea how to get back HVFs and while they evidently intend to try to use their sales force to push "network" (and it sounds discounts) to "corporate accounts" I don't see any plan, or even an acknowledgement that they also have to win back HVFs who are not tied to corporate accounts.
And discounting existing corporate accounts will not help their yields either...
As BofA said on Friday, stock is going to $22 a share (or lower).
The focus seems to be corporate accounts but there is no mention of HVFs not attached to corporate accounts.
And, the discounting will push down yields, which is a key point raised by analysts on the last earnings (or lack of earnings) call.
Devil's advocate position: I'm guessing that ROI is higher when spending time to focus on nurturing large corporate contracts compared with chasing all the HVFs not associated with a corporate contract, and, after they pull back some corporate accounts with deep discounts, they can then start raising prices next year assuming the accounts are willing to stay.
From where they are now, I don't see that they have a better near term area to focus on than this one. In other words, if I were in this situation, I'd spend my time trying to win back contracts rather than thinking about a strategy to win back non-affiliated HVFs. It doesn't seem they are capable of doing two things at once.
Jan 28, 2013, 5:25 pm
#10
In memoriam
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Look, they knew long before the earnings call which direction the HVF traffic was heading. They should have come up with a plan and had it implemented before the call so they could be speaking about what they'd already begun.
The only thing missing from the gang who couldn't shoot straight is Don Knotts as Barney Fife. Ready, fire, aim....
The only thing missing from the gang who couldn't shoot straight is Don Knotts as Barney Fife. Ready, fire, aim....
Jan 28, 2013, 6:16 pm
#11
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my company allows to book pretty much any carrier and has corporate contracts with all major airlines. UA going after major corporations is useless, they have to treat their customers well ... guess they just don't get the picture.
Jan 28, 2013, 6:20 pm
#12
Join Date: Mar 2010
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Based on my Saturday "burning down my last vouchers" flight, their issues are decidedly not behind them. 3 segments, 1 UA & 2 US - went to check in for my UA flight and they were unable to see the US segments. Walked 20 feet down to the US counter, checked in for those flights with no issues and they were able to print out the full itinerary, including the UA segment, for me to bring back to the UA counter to check in and check my bag.
Apparently, UA defaults to UA routing no matter what route you fly, since my bag went via NWK and arrived this afternoon, almost 48 hours after I did - glad I was headed home so the inconvenience was minimal.
US also uses SHARES, so this is down to either a continued use of really sub-par GUIs or what I'll term "operator error". In either event, I was not impressed and am not exactly in mourning over the fact that my employer continues their policy of prohibiting travel on UA unless a voucher is being applied or no other airline serves the destination. Since UA was banned for corporate travel late last March, they're down to the last few months of residual voucher travel.
To put things in scale, there are ~90k people who work at the company. My immediate department is ~2000 people, we have an ~$11 billion annual travel budget. Based on the numbers I saw last year, UA in 2013 has a chance at <$100k of that because of a) dreadful performance post merger and b) insufficient service recovery during (a). I know because last April I became the department travel approver, so I have access to all the numbers. UA screwed up. As a business, we can't afford to have people stranded nor to pay an unlimited number of last minute fares on other carriers when UA can't get the job done. Based on what I've seen, and what's been reported to me, of this year's UA trips, not one has been clear of issues. We will not be reconsidering UA as a preferred vendor in 2013.
Apparently, UA defaults to UA routing no matter what route you fly, since my bag went via NWK and arrived this afternoon, almost 48 hours after I did - glad I was headed home so the inconvenience was minimal.
US also uses SHARES, so this is down to either a continued use of really sub-par GUIs or what I'll term "operator error". In either event, I was not impressed and am not exactly in mourning over the fact that my employer continues their policy of prohibiting travel on UA unless a voucher is being applied or no other airline serves the destination. Since UA was banned for corporate travel late last March, they're down to the last few months of residual voucher travel.
To put things in scale, there are ~90k people who work at the company. My immediate department is ~2000 people, we have an ~$11 billion annual travel budget. Based on the numbers I saw last year, UA in 2013 has a chance at <$100k of that because of a) dreadful performance post merger and b) insufficient service recovery during (a). I know because last April I became the department travel approver, so I have access to all the numbers. UA screwed up. As a business, we can't afford to have people stranded nor to pay an unlimited number of last minute fares on other carriers when UA can't get the job done. Based on what I've seen, and what's been reported to me, of this year's UA trips, not one has been clear of issues. We will not be reconsidering UA as a preferred vendor in 2013.
Jan 28, 2013, 6:26 pm
#13
Join Date: Dec 2003
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If they want to win back valuable business travellers, then treat us like valuable business travellers. I logged 135K miles on UA--mostly in paid int'l J--and cleared 1K in early November. Off to Europe I go on Wednesday with no *A credentials. The business lounges will be fine but the Senator lounges would have been better but we all know that's not going to happen with an expired card. Made 1K early November...three months later...
Jan 28, 2013, 6:37 pm
#14
Formerly known as I_Hate_US_Airways
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Dear JSMI...
YOU & your buddy, "Mr. Over-Entitled" can "kiss-my-grits" to quote Flo from one of my favorite TV shows from the 70's if you really think you have a shot of earning back my $95K a year in business. While I maybe a pee-ant in the scheme of things; Dude, YOU AIN'T getting my $$$ )-:
Jan 28, 2013, 7:08 pm
#15
Join Date: Aug 2011
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Based on my Saturday "burning down my last vouchers" flight, their issues are decidedly not behind them. 3 segments, 1 UA & 2 US - went to check in for my UA flight and they were unable to see the US segments. Walked 20 feet down to the US counter, checked in for those flights with no issues and they were able to print out the full itinerary, including the UA segment, for me to bring back to the UA counter to check in and check my bag.
Apparently, UA defaults to UA routing no matter what route you fly, since my bag went via NWK and arrived this afternoon, almost 48 hours after I did - glad I was headed home so the inconvenience was minimal.
US also uses SHARES, so this is down to either a continued use of really sub-par GUIs or what I'll term "operator error". In either event, I was not impressed and am not exactly in mourning over the fact that my employer continues their policy of prohibiting travel on UA unless a voucher is being applied or no other airline serves the destination. Since UA was banned for corporate travel late last March, they're down to the last few months of residual voucher travel.
To put things in scale, there are ~90k people who work at the company. My immediate department is ~2000 people, we have an ~$11 billion annual travel budget. Based on the numbers I saw last year, UA in 2013 has a chance at <$100k of that because of a) dreadful performance post merger and b) insufficient service recovery during (a). I know because last April I became the department travel approver, so I have access to all the numbers. UA screwed up. As a business, we can't afford to have people stranded nor to pay an unlimited number of last minute fares on other carriers when UA can't get the job done. Based on what I've seen, and what's been reported to me, of this year's UA trips, not one has been clear of issues. We will not be reconsidering UA as a preferred vendor in 2013.
Apparently, UA defaults to UA routing no matter what route you fly, since my bag went via NWK and arrived this afternoon, almost 48 hours after I did - glad I was headed home so the inconvenience was minimal.
US also uses SHARES, so this is down to either a continued use of really sub-par GUIs or what I'll term "operator error". In either event, I was not impressed and am not exactly in mourning over the fact that my employer continues their policy of prohibiting travel on UA unless a voucher is being applied or no other airline serves the destination. Since UA was banned for corporate travel late last March, they're down to the last few months of residual voucher travel.
To put things in scale, there are ~90k people who work at the company. My immediate department is ~2000 people, we have an ~$11 billion annual travel budget. Based on the numbers I saw last year, UA in 2013 has a chance at <$100k of that because of a) dreadful performance post merger and b) insufficient service recovery during (a). I know because last April I became the department travel approver, so I have access to all the numbers. UA screwed up. As a business, we can't afford to have people stranded nor to pay an unlimited number of last minute fares on other carriers when UA can't get the job done. Based on what I've seen, and what's been reported to me, of this year's UA trips, not one has been clear of issues. We will not be reconsidering UA as a preferred vendor in 2013.