John D. Rainey, the executive vice president and chief financial officer of United Airlines, reportedly said during his presentation at the Bank of America Transportation Conference on May 17, 2012 that:
“(W)e also changed our Mileage Plus program, some of the benefits that, uh, accrued to the members. Uh, we, uh, we had certain groups in this group were over entitled if you will. Uh, and now, uh, we have realigned the benefits of that program with what the, the, the customers and, and, program, um, um, the participants are actually providing to the airline, and, and this is a good change going forward…”
…and FlyerTalk members are furious.
FlyerTalk member chinatraderjmr — whose company had already refunded approximately $132,000.00 in airfare due to allegedly poor customer service by United Airlines a week before the conference — had this response: “I wonder if he feels $3,000,000 a year makes him “over entitled”,” while FlyerTalk member demkr posted: “UA was ‘over entitled’ to the 2K I was about to spend for a flight to London in Y.” FlyerTalk member scottish_colin posted: “This ‘over entitled’ 1K just finished booking all of my travel through the end of July. On AA… I’ll ‘re-qualify’ EXP on July 25th most likely (78 days after my first AA flight) – that’s about $30,000 that COdbaUA would have gotten if they’d just maintained PMUA’s attitude and customer service.”
What exactly did Rainey mean by his statement? Specifically, who were the certain groups to which he referred?
Regardless of whether or not the Mileage Plus frequent flier loyalty program of United Airlines will experience changes which may reduced fixed and variable costs by not catering as much to its elite members, increase revenue, or a combination of both, Rainey may have broken the cardinal rule of insulting a group of customers with his statement — and FlyerTalk members are posting that they are leaving the airline, as evidenced by the aforementioned statements.
What do you think Rainey meant by his comment — and is he correct?