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Transcript of March 15th FlyerTalk Live! Chat

With special guest Russ Hinckley from Northwest WorldPerks

Jump to the last 30 minutes w/ Randy Petersen



Randy Petersen
Good evening everyone and welcome the frequent flyer version of March Madness......We might as well get going, but first a few things....

Randy Petersen
Our special guest, the big guy at WorldPerks has gifted FlyerTalk with 100,000 WorldPerks miles. And rather than the trivia which sometimes goes to the fastest dial-up connection, one of our moderators tonight will give you a tip on how to enter a drawing for 5 winners fo 20,000 miles each....enough for a free ticket....

Randy Petersen
So, let's go with Russ Hinckley, the Managing Director of WorldPerks......welcome Russ, a few words to this group of FlyerTalkers....

Russ Hinckley
Thanks for inviting me. Look forward to talking with all of you.

Randy Petersen
Well no small talk, let's go to the first question.....

Mikel at WebFlyer
This question was submitted earlier by Mike Turnbull: Any further news regarding full FFP reciprocal benefits between NW, CO, and KLM, thanks (from the UK )?

Russ Hinckley
Currently, Northwest maintains full reciprocal FFP partnerships with Continental and KLM. KLM and Continental are currently evaluating the possibility of an Alliance relationship, which would also include future FFP reciprocity

Randy Petersen
next question?

Mikel at WebFlyer
This question was submitted earlier by Ron: Why has it gotten so hard to use my WP Miles to either upgrade to World Biz Class or cash them in for a round trip WBC tix to Europe? Many NW Frequent Flyers are quite upset about the changes to make it harder to use miles for WBC to Europe (it has been discussed at length on this Board) so why the change, and are you going to make any changes to make it easier for us to use our miles for WBC to Europe?

Randy Petersen
A good question we could ask of many programs....well Russ?

Russ Hinckley
Your question basically boils down to two parts: a. Why did we make the change? b. Will it get any better?

Russ Hinckley
Why did we make the change? When we made the commitment to improve World Business Class to 60 degree pitch and lose seating capacity in World Business Class, we had to find additional ways to sell more seats. Moving upgrades to a more restrictive inventory class was one result. We also checked competitively where we were with our upgrading practices and found that we had been far more liberal than most carriers. Nearly every carrier had upgrades like these in a more restrictive inventory class and/or only allowed such bookings within 30 days. Thus, while we know that this was unpopular, it was an economic and competitive necessity.

Russ Hinckley
Will it get any better? We are adding another category of inventory to World Business Class that will result in more capacity being allocated to upgraded fares. You should see some improvement later this year.

Russ Hinckley
Sorry about the long answer; it was a difficult and complex decision.

Randy Petersen
OK, there you go....next question? At least we see some attention given this....

Mikel at WebFlyer
This question was submitted earlier by Dan Mruz: Are Continental flights miles considered in requalifing for various elite status? What about America West airlines miles which is owned by Continental?

Russ Hinckley
All WorldPerks miles gained by flying on Continental, KLM, Alaska Airlines, Alitalia and all NW coded flights on other partners count towards elite status qualification. The current Northwest / America West frequent flyer agreement is limited in scope. Elite qualifying miles are limited to WorldPerks miles accrued on NW codeshare flights operated by America West. next...

Mikel at WebFlyer
This question was submitted earlier by Carolyn Charney: Any chance of bringing back miles earned for travelling on the Cybersaver fares that are posted each Wednesday? These miles should also be counted as credit miles for elite status.

Randy Petersen
Ohhhhhhhh. I knew this question was going to come up.

Russ Hinckley
We have discussed CyberSavers a lot internally (nearly as much as it was discussed on Flyertalk). In making the decision to eliminate WorldPerks accrual on CyberSavers, here is what we considered:

Russ Hinckley
We don't make enough money on these fares to get an economic return on the miles. We think purchasing CyberSavers is almost entirely a price decision, not a loyalty decision. We may rethink this at some point for other reasons; however, our CyberSavers business does not appear to have suffered as a result of this decision. With regard to the second part of your question, we obviously disagree that CyberSavers should count toward Elite qualification. We want our Elite Tiers to reward our best and, frankly, most profitable customers.

Russ Hinckley
We have the additional concern of our Elite Tiers becoming overpopulated and being unable to provide complimentary domestic upgrades to our members' satisfaction. Having CyberSavers qualify for Elite status hurts the program

Randy Petersen
"nearly as much as it was discussed on FlyerTalk"? Gee they must be watching us pretty closely...

Russ Hinckley
see we do check in occasionally

Mikel at WebFlyer
This question was submitted earlier by Dave Ulmer: I have been trying all morning to speak with a World Perks agent only to be told the system is full and I am disconnected. What gives?

Russ Hinckley
I apologize for this inconvenience. At times our phone lines get so overloaded that we make the management decision that it is better customer service to block the call rather than let customers in the phone system only to be on hold for a very long period of time. Neither option presents ideal customer service and this is unfortunate; it is impossible to have 100% staffing accuracy.

Mikel at WebFlyer
This question was submitted earlier by Jim Bunch: Will NW ever go back to segments for elite qualification? Those of us that fly a lot of short haul segments feel left out of the elite equation. I fly just as much as most Gold's that I know, but am only Silver because of the shortness of my routes. It has been suggested that I take CO credit instead of NW so that the segments will count, then get the CO status and receive the perks of the higher level that I would enjoy vs. NW but I have a hard time doing that.

Russ Hinckley
I am glad you asked this question. Working through this situation is one of my highest priorities but I must admit that I haven't got this figured out yet. Truthfully, mileage alone does not always equate well to customer value. However, aggressive mileage thresholds are a competitive necessity and an easy to understand benchmark for all our customers. By using segments, the number of people in each Elite tier explodes and the value of your Elite benefits decreases. It is a challenging situation. But we're up to the challenge. Next

Dan at WebFlyer
Okay, here's how to enter the drawing for 20,000 WorldPerks miles:

Dan at WebFlyer
- You must be a WorldPerks member....

- You must have been in the chat tonight....

- Send an email to webmaster@flyertalk.com with the following information: 1) Your name as it appears in your WorldPerks account. 2) Your WorldPerks Number 3) The username you used during this chat event.

Dan at WebFlyer
We will draw 5 winners from the list of entries and post those lucky people on FlyerTalk early next week. Good luck and thanks again for your interest in FlyerTalk Live! and now...back to the chat!

Mikel at WebFlyer
This question was submitted earlier by thezipper: The benefit of International upgrades for Platinum Elite members has been discontinued. When will a new perk for Platinum's (e.g. Systemwide Upgrades) be added to replace this?

Russ Hinckley
In 2000, Northwest eliminated its First Class cabin on international flights to make room for a larger, improved World Business Class that will add more legroom, new, more comfortable seats that have a deeper recline, more delicious meal options and many other services that our business travelers have been asking for. Northwest made the decision with the help of consumer research that told us a better World Business Class product was more important to the majority of our travelers. As a result of eliminating First Class, we could no longer keep this Platinum Elite benefit. We're constantly exploring ways to increase the value of the program. Hopefully we'll get a few good ideas tonight.

Russ Hinckley
What else do you have for me.

Mikel at WebFlyer
This question was submitted earlier by thezipper: What is NW's response to the mega-merger trend in the industry? With WINGS unrealized, are there plans for an alternative broad alliance?

Russ Hinckley
Northwest maintains the same strategic options as other air carriers. We can be part of the mega-merger trend. We can continue to develop our current global alliances. We can do nothing. Northwest's bias is to continue to develop and expand our network through global airline partnerships. Northwest currently has alliance / frequent flyer relationships with several global airline partners including: KLM, Continental, Alaska Airlines, Alitalia, Air China, Japan Air System and Malaysia Airlines. Northwest continues to monitor the competitive environment and evaluate new Alliance opportunities.

Russ Hinckley
These are great questions!

Randy Petersen
Can i jump in for a second? If I understood you Russ on that previous question, much of the systemwide upgrades changes can be traced to cabin reconfig? If there had been no trend to 2-class service, they (the systemwide upgrades) might still be around?

Russ Hinckley
Yes, we weren't planning on eliminating it as it created a point of difference between Platinum and Gold

Randy Petersen
thanks for the clarification, I really hadn't known that....

Mikel at WebFlyer
This question was submitted earlier by thezipper: Why do Asian member Platinum and Gold Elites receive free access to WorldClubs and CO Presidents Club while US members do not? Will this policy change?

Russ Hinckley
U.S. based programs do not have complimentary access to pay per passenger lounge programs as the standard. Complimentary lounge access for top tier Elite members is the competitive standard in Asia. We will continue to be competitive in local market conditions.

Mikel at WebFlyer
This question was submitted earlier by rthib: Any thoughts on adding some non-airline rewards (milepoint is a joke, so that does not count), Specifically NWA related ones such as world club memberships for miles (such as offered by AA for admirals club).

Russ Hinckley
One of our principal goals is to maximize the utility of the WorldPerks program and to provide as much added value as possible, or that is economically feasible for our members. With this in mind, we are always looking at alternate awards, as well as non-airline rewards as a way to further develop and optimize the WorldPerks program. While it is too premature to announce the specific programs that are under consideration, our goal is to launch some non-airline partner alternate award opportunities within the next 12-18 months. Sorry if you don't like MilePoint. We like it because it adds more utility to the program. Remember Mark Lacek had my job a few years ago. Next...

Anne at WebFlyer
You know I think Randy has a question, can he jump in here...

Randy Petersen
I'm sure he meant MilePoint as a good joke, not a bad joke.....or so i hope

Randy Petersen
Yes, I've got a question... There's been some buzz around of some new concepts that allow members of programs to go through a legal airline endorsed broker to trade miles and points among currencies. Where does WorldPerks stand on such things? I understand that Alaska and America West, partners of yours are signed up for one of these new concepts....

Russ Hinckley
Unfortunately this is a clear violation of our program rules. We do provide members a lot of options for using their miles, and booking award tickets for others. We will always be responsive to the marketplace and our competitive position. Next...

Mikel at WebFlyer
This question was submitted earlier by RKG: Why has NWA increased the cost of US-Asia WBC tickets from 75K to 80K miles?

Russ Hinckley
With our improved World Business Class, we are offering a much-improved service to our customers and therefore increased the award mileage required for travel to Asia. We still offer a lower award than our competitors, for example both Delta and United charge 90,000 miles for their business class awards to Asia. next...

Mikel at WebFlyer
This question was submitted earlier by mat123: a. What is the probability of a mechanic's walkout/strike/work stoppage/slowdown in the coming months? b. What will be NW's response be if one should occur? c. Should we start booking travel on other airlines for flights in the near future (spring to early summer)?

Russ Hinckley
Since the calling of a Presidential Emergency Board (PEB), AMFA is, by law, prohibited from striking or taking any random job actions for the next 60 days. The PEB will study the negotiations and make settlement recommendations. Northwest has already agreed to accept the contract terms the PEB recommends. We are committed to using our best efforts to come to a fair and equitable agreement with AMFA. Regis that is my final answer.

Mikel at WebFlyer
This question was submitted earlier by snackyx: How long should it take to mid-year Elite status to show up? What exactly is NW policy regarding those who reach 25, 50 or 75,000 miles before year's end and do not have Elite status yet with the airline.

Russ Hinckley
Accounts accruing credited flight mile levels of 25,000; 50,000 or 75,000 are upgraded to the appropriate Elite status every evening. The effective date of the Tier would be the next day. The credential kit will take about 4 weeks to be mailed and received at your address on file. Next...

Mikel at WebFlyer
This question was submitted earlier by B747-437B: Why do Platinum and Gold Companions have priority over actual Silver Elites for airport upgrades on domestic flights?

Russ Hinckley
Last year we changed the program so that companions of Platinum Elite and Gold Elite members do not have priority over Silver Elite members for First Class upgrades. Companions are upgraded at the airport on the day of departure on a space available basis. Also, companions cannot be placed on the airport standby list for First Class until day of departure and at the airport only.

Randy Petersen
Russ, if you get a tough question and need help, remember, you haven't used any of your lifelines yet......

Russ Hinckley
I'd like to phone a friend.

Randy Petersen
That friend is the new boss at Burger King I think.....

Mikel at WebFlyer
This question was submitted earlier by thezipper: Northwest continues to offer Fast Track/Gratis Silver to Gold, Continental will let members BUY status if they fail to requalify from the previous year, diluting the Elite ranks of both programs. When will these marketing gimmicks be discontinued so the True Silvers and Golds who fly the 25/50K miles per year will have the upgrade availability they rightly deserve?

Russ Hinckley
While we do make promotional offers to leverage the marketing power of our Elite programs to win more customers, we are constantly tracking the size of each Elite Tier and the success rate of the complimentary domestic upgrades. We think that we have the best Elite tier programs among our key competitors and want customers to feel the same. If we allow too much growth, that will not be the case.

Russ Hinckley
Have you heard about the new Burger King product?

Randy Petersen
here comes a good one.....

Russ Hinckley
It's called the Dasburger.

Randy Petersen
HAAAAA!

Randy Petersen
Now, just like FlyerTalk, let's get back on topic......more questions about more miles.

sandy
Why don't any programs offer a one way option- using, say 12,000-15,000 miles for a domestic one-way?

Russ Hinckley
A one-way product severely dilutes our business product. So therefore, it is very costly.

bd_100k
I had not heard the news that NWA discontinued offering international upgrade privileges for platinum elite members. To me, this now makes NWA's top tier inferior to my UAL 1k top tier as I continue to get a base of 6 international economy to business confirmed upgrade certificates per year. Would you care to comment?

Russ Hinckley
When we eliminated international first class, we gave Platinums the option of increased bonus miles or coach to business class upgrades. Our members preferred the bonus miles. We are trying to find creative ways to enhance the program and value for our members.

nq
Please clarify this point - Why does NW charge 120000 miles for India and 90K for Asia a round trip on Business Class

Russ Hinckley
We don't serve India on a non-stop basis. Award travel is via AMS; therefore, it is more expensive and we have less capacity.

Randy Petersen
Remember, no SWU's here either.....

ontheroad
I have a question for Russ: What is your background? Did you ever envision yourself as the Managing Director of a Frequent Flyer program? What kind of career path got you here?

Russ Hinckley
I have always loved loyalty marketing, but it took me a lot of different steps to get here. I previously worked in Sales, Marketing, Reservations and Finance at NW. I'll send you my resume.

Rssrsvp
Will NW comp elite status to people who wish to switch from other carriers? If so who do we contact , and is it equal status?

Russ Hinckley
We have done programs like that on a one off basis, but not on-going.

tckc
Russ, I will be looking for a new carrier in the aftermath of TWA's demise. TWA offered unlimited upgrades to their Platinums - does NWA do the same?

Russ Hinckley
Yes, we do. We offer unlimited, complimentary, automatic upgrades valid for travel on NW and CO domestically. Have you seen our new upgrading status messaging? It is pretty cool

warrenlm
You asked for ideas on improving the program. How about waiving administrative change fees for top tier members?

Randy Petersen
nice suggestion......e-tickets were supposed to make all this costless....

Russ Hinckley
That's a good idea and actually it is under consideration.

Randy Petersen
what other kinds of things do you hear from members Russ? Are you looking for feedback in any particular area? If so, we at FlyerTalk think we could put together a nice long thread of ideas for you.....

Russ Hinckley
I hear from members all of the time....there is a lot of creativity out there. We also have an elite advisory board that gives us a lot of suggestions.

Randy Petersen
We've got about 5 minutes to go....any more questions?

Mikel at WebFlyer
How about Hilton HHonors exchange for points?

Randy Petersen
Man...i was going to ask that one.....well Russ?

Russ Hinckley
As previously mentioned, we are exploring alternate awards. However, we found that our members are more interested in earning opportunities.....

Russ Hinckley
any more questions?

dawna
RE: The Flyer faster promotion is it 10,000 bonus miles after using 5 partners or 2,000 bonus miles per partner up to 10,000 miles.

B747-437B
why does NW not offer Silver Elites access to a dedicated dial-in line like every other US airline does?

Russ Hinckley
Benefits get better the higher in the program you get......

Randy Petersen
Russ, i see your current Gold Events auction with the NASCAR guy for the motorcycle trip was extremely popular. How often are you continuing the Gold Events and what is the next event you have planned?

Russ Hinckley
We have a Gold Event in MEM coming up in June and 4 or 5 scheduled for the remainder of the year. We just hosted BB King in NYC and it was a fabulous show.

Randy Petersen
Russ, you've been absolutely great tonight, thanks for the insight and thanks for taking so many questions. We'll get you out a souvenir FlyerTalk t-shirt as a gift. Continued success with WorldPerks and come back some time........Again, thanks and we'll see you on one of the red-tails......

Russ Hinckley
Randy, thanks for inviting us and the valuable service you offer to the frequent flyer community.

Randy Petersen
Great guest tonight and many, many thanks for the 100,000 WorldPerks miles donation to FlyerTalk, you're going to make 5 people very happy.......

Russ Hinckley
I'll look forward to seeing you at the House of Miles.

Randy Petersen
OK, open lines now for the next half hour. I'll take some of your questions so ask away.......

KittyCatPilots
Does NW honor the AMEX bonuses that CO is offering

Randy Petersen
Nope, that was a separate deal that CO struck with AMEX. As you might know, NW used to be part of the Membership Rewards programs but a tiff developed and they are no more, except through hotel point conversions the back door.....

Randy Petersen
more questions......

JRF
Randy, how about an update on the DL situation. Should we really keep trying or is what DL doing the future of the airline industry?

Randy Petersen
JRF - if i were to rewind what Russ said tonight from NWA, it looks like the future given the 2-class service. However, there's more to this. I think SaveSkyMiles has to continue and similar measures like DenyContinentalTheFreddie because they are your and our way to keeping the programs on their toes. Not that we suspect to roll over and play dead. We're simply asking for respect and let the movement continue..... next question

steve100
Randy - I personally feel this consolidation in the Airline industry is very bad for use frequent flyers (ie: a lot less programs to earn miles in, therefore a lot less competition to keep it competitive). Is there something we, as a group, can do?

Randy Petersen
Steve100 - as many of you know, I have been quite critical of the UA/US merger. The TWA situation is an exception. However, as a realist, I don't think there's anything we can do individually as there is too much of this as part of the political game in DC and trust me, with million-dollar lobbyist and such, the little guy doesn't have much of a voice. The good thing is that most of these airlines can't agree on anything expect higher airfares. It's nice that DL and CO couldn't agree on who might run the combined airline there, so they both went to Congress to protest....I actually think we're safe.... next question

Mikel at WebFlyer
Any word from Hoyt Harper on the AMEX SPG card? He promised us an answer on the changes weeks ago..

Randy Petersen
I think the message i got today was that the ink still wasn't dry on the deal. If you don't know, AmEx is infamous for long drawn out negotiations. As soon as I heard officially (well, maybe unofficially) I'll post on FlyerTalk....next question

Anne at WebFlyer
Randy, Do you have any insight to the LatinPass evolution into Globalwhatever? More opportunities to use miles? Did you get your bonus?

Randy Petersen
At the risk of being out of character, I have no idea. I am very, very disappointed in the people who run that program. I have never seen so many anti-member changes to a program to take away their value. That was last June. I have yet to get my first statement and think they used that promo as a hook for GlobalPass. We'll see, but it will be panned by me. End of "no comment". next question....

hnechets
Very general question, Randy. How do YOU think the airlines see us, the very frequent flyers? I mean, do they see us a valuable assets, or just another class of revenue producers? Not trying to be negative, just asking for your personal opinion of this. I've often wondered, and do not see myself as in any critical tot heir profit margins.

Randy Petersen
We're in difficult times to answer that. I think there are people like Russ at NWA who are the champions of the frequent flyer, but honestly, there are more decisions being made at programs based on spreadsheets than ever before. In fact, most of the decisions of partnership and such at Mileage Plus are now made by a division of dot.commies that were spun off to get value from the tech hype......We're not dinosaurs yet, but face it, a mile you fly earns about .8 cents to the airline. A mile they sell earns about 1.23 cents to the airline......what do you think? next question....

stuff
Randy, I was disappointed CompuBank dropped ClickMiles. Do you know if they are considering any other incentive programs? Either CompuBank or ClickMiles?

Randy Petersen
I think you'll see more companies dropping ClickMiles. For most, the rate to buy miles on their system is about 3.75 cents per mile (that's what we are paying now) and that is expensive in times like this for any of the dot.com companies. They better be careful or the other currencies like WebMiles and Air Miles and GreenPoints will be on track.......bottomline - don't look for any long lasting deals out there.

JayJ
Any plans for a House of Miles party this summer or fall? Mileage Addict suggested it in the past.

Randy Petersen
Yea, he has got a great idea and I've got many people lined up to kick it off. Bob Crandall the former CEO of American and who is widely credited with creating these programs said he's come to speak and many others to support the 20th birthday of FFPs in May. I honestly want to do it, but am just short on time and planning manpower right now. I will try as I'd like to welcome you to my home and as you saw Russ said, every one in the industry wants to come also..... FlyerTalk will always be the first to know and i am very appreciative of the support from you for the idea... next question...

Randy Petersen
Hey, I'm as much a mileage hound as anyone, but if i were running that business, I'd make the same decision. Look no farther than the buzz about mileage runs. Just as we used to snub our noses at people sitting next to us paying $200 for a ticket when we were on business at $800, we're likely to also snub our noses at Elites who paid a total of $1,200 in airfares to be Platinum and are getting all our upgrades. This is just a stereotype, but it's likely to be the trend, after all, they also cut commissions to their online travel agencies so we're not the only ones being picked on.......

doc
If you can use volunteer help on arrangements for a big House of Miles bash, please let us know! Certainly, many would step up to help, including me!

Randy Petersen
doc, some say on line that you speak for me. I think you speak for yourself and really do appreciate the help....I may take you and about 50 other FlyerTalkers up on that......

davidinky
Randy....given your answer about ClickMiles, do you feel it is doubtful we'll see any 2:1 redemption offers for Starwood or airline partners?? I've been saving my Clickrewards balance in hope they'll offer it again soon!

Randy Petersen
I just don't see the math in it anymore......it was a grow the membership base trick for ClickMiles, but now that they are public, and stock is at $2, highly unlikely. But of you hear something first, let me know... next question

chexfan
Randy- re: the US/UA merger as I posted earlier, a concern for US flyers in the merger is what is going to happen to our upgrades. How do you personally think UA will honor them (the 800 milers and SWUs) if the merger goes through?

Randy Petersen
I don't think they will do anything with them other than let them expire naturally. I can't exactly remember, but US Airways may have the same 6-month advance notice that TWA has which means for that time it's upgrade as usual. As you might know from my comments on the merger, Dividend Miles members, especially elite will suffer badly.

sharptalk
Any chance of double points from the clickrewards transfer program for Starwood like last spring?

Randy Petersen
Tough to call because Starwood is so unpredictable. They do some amazing things and right now, I don't know where they are headed. My gut tells me no? But I don't mind asking them face-to-face. Remind me and I'll see what I can find out. After all, I currently have 156,200 ClickMiles....

Randy Petersen
OK, I think that's the end of our 90 minutes. Again thanks.....

Randy Petersen
Good luck to all you for the 100,000 WorldPerks mile drawing.....Let's take moderating off and mingle......Good evening and I thought this was one of the best so far. You all had great questions and they were some great points made....

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