Discuss!!


AIRLINE club cards are free, but they come at a price. That little piece of silver plastic (or gold, if your company is a big spender) looks harmless enough, letting you into the executive lounge with its free nibbles and drinks, and keeping you in the sights of the airline’s marketing department.
You or your company have paid a fortune for those snacks, of course, but like taxation or bank charges, it’s an invisible pain that disappears with the prestige of the executive lounge. And you have the free flights to look forward to.

Flights on mileage are a double-edged sword — most businessmen spend quite enough time in aeroplanes, and the idea of flying even further on holiday with the family in tow is not too attractive. But it’s still something for nothing, a perk of the job.

From the airline’s point of view, the gold card is just the customer point of contact for a vast web of marketing incentives. Combine the package with the airline’s marketing alliances — Oneworld for BA or the Star Alliance for BMI — and the leverage of the benefits spread around the world is extraordinarily powerful.

Mileage began innocuously as a bright idea. I remember one American airline in the 1980s offered triple mileage all year provided you flew before the end of March. Dozens of canny commuters in San Francisco switched for the day from the Bart commuter trains to the airline’s shortest flight — a two-minute hop across the bay from Oakland to San Francisco International. An expensive trip, but they got their triple mileage.

A few months later, after a series of similar promotions, a number of American airlines found themselves flying more passengers for free than for revenue, and owing a whole lot more mileage which they hoped would never be claimed. Marketing’s new baby was turning into a monster that was eating the airlines alive. There was no escaping the power of those little gold cards.

That power is about to be tested again with Continental doubling direct routes to Scotland from New York, and the summer return of other airlines flying direct to Philadelphia, Toronto and Chicago. Will the little gold cards keep the Scots travelling through Heathrow?

The answer lies in the travel policy of Scottish companies. Personal choice (ie the gold card route) is rapidly giving way to the cheapest, or most direct, or a combination of the two, as travel departments take control of spending. As for the Scottish executive, the answer is very much use it or lose it. These direct routes have been a long time coming, and they must not just slip away.

The loser in all of this may be British Airways this time around. There is an amazing lack of sympathy for BA among Scots businessmen who feel they have long been perceived as a captive market. Flat-rate fuel surcharges do not help — they have the effect of forcing full-fare Shuttle passengers on fully loaded fuel-efficient Airbuses to subsidise long-haul gas-guzzling jumbos, with a supplement disproportionately higher than the fare paid. Since BA charges per leg flown, Edinburgh pays double the fuel penalty of London to fly to New York.

Many Scots businessmen feel they have been held to ransom for years by BA’s commitment to Heathrow — I was astonished to hear one businessman say that, in his opinion, BA’s policy had been consistently anti-Scottish for decades. He is clearly not alone.

But the old stranglehold is breaking down. The technology of online booking, where BA’s yield management is at the leading edge, makes fares completely transparent, drives prices down and improves choice. Direct flights, combined with travel policies that force employees to use them, will break the stranglehold of the Heathrow transfer.

Paying more to fly further for longer using more fuel is wasteful in every respect. Scots business will benefit from breaking the tyranny of the little gold card.