Originally Posted by
in_27D
if you subscribe to the belief that most new entrants to GS represent the top X% revenue producers, as long as there is a means of GS requalification without being a top X% revenue producer (for example the 50K full fare miles), GS count as a percent of pax should grow every year. Some people will requalify who wouldn't make GS if they didn't have it already.
I can only assume that if United thinks GS is too large they'll make the re-qualification harder.
I more subscribe to the belief that they'll be ready to throw GS to anyone giving them $XX k (30-40 currently) in margin dollars. Why limit it to X% - those are super profitable customers and the more the better. It's not likely to crowd out the current GS base at current levels. If it crowds out 1Ks, they'll be fine with that, as that high margin GS customer is worth more than the 1K.
Given Continental's $30k for their GS-equiv, as a 1K, I'm nervous they'll actually be expanding the GS base. Margin is much more important to them to chase than plain lowest fare miles.
I don't yet buy the "I'm having more problems upgrades - must be all these swelling ranks of GS's and 1Ks". For me, route pairs like SFO-IAD, SFO-BOS, SFO-LHR, have always been difficult upgrades at biz traveler popular times, whether it's 8, 5, or 3 years ago. It's not great currently either (25-50%), but I don't see it as worse than it used to be. What I'm more worried about is if they adopt more the Contentinal mode of selling upgrade at cheaper prices for all status jumping ahead of UDU - my upgrading there has been brutal (like being 26/40 on the list as a 1K).