Originally Posted by
Staffsknot
Again this talk of "undesirables" is not borne out by the repeated sales and BAH offers of double TP, the offers of botched bonus TPs and the like.
If they wanted to cull "undesirables" it was in their gift to target just those individuals. You have GGLs and Golds who are spending a tidy sum with BA looking elsewhere and a vocal backlash outside these pages.
Short-term pain for a business may be viable if you don't do it in a way that causes longterm echos.
That you don't recognise this is rather strange.
Analysts I have met loads of over the years and tbh they were saying Barclays potential takeover of ABN Amro was a great idea right up until RBS did it and it wasn't...
Same analysts were bullish about Enron, Bernie Madoff, Neil Woodford, etc...
Analysts were bullish about Lloyd's motor finance push right until it has now been caught up in the big FCA investigations into the industry and now its a potential disaster.
I could go on but the outcome would be the same. Faith in analysts is fine in regular times of little change.
Now please explain how someone spending and travelling enough to get Gold or GGL even under the old system is "undesirable"? Not the tiny number of TP runners who got it for £3k or £4k but your average Silver or Gold who probably spent vastly more?
BA are banking on a capacity squeeze, monopoly of LHR and people who were Gold being content as Silver to do all their heavy lifting.
Treating folks like undesirables is precisely the style and comms execution that has got them in this hole
I was not expressing faith in analysts - I have been a professional investor for 25 years, I know the strengths and weaknesses of "sell-side" research. Rather, by looking at analysts' research, it has become clear to me that IAG/BA has no room to disappoint given the narrative that IAG/BA have sold to the analyst community. To me, these changes feel like a high risk strategy, but - as I have already said - BA have more data and insight than me. And again, that is not to say that they will be ultimately be proven to be correct.
Someone travelling enough to get Gold or GGL appropriately under the old system is not undesirable. But BA has decided that they do not need/want to reward them in the same way that they previously did. They are prepared to take the risk that if some Golds becomes Silver, or GGLs to Gold, that customer will remain a customer spending the same/slightly less. In some cases, customers will be incentivised to spend more to maintain their current status, or to consolidate other spend (e.g. hotel/car hire spend to BA Holidays).
I have been a member of BAEC since 2003. I don't have any data to support this, but I suspect there are more Golds as a proportion of total members than their was in 2003. Four things certainly have contributed to this: (1) the removal of the reset to zero of tier points at the point of achieving a new status level, which made it harder to progress through tiers, (2) the increase in tier points per segment for premium flights, e.g. 120 to 140 for J, (3) BA Holidays double tier points, although that was no doubt an intentional strategy to establish as many customer relationships as possible with BAH ahead of this change, (4) the implementation of permanent lifetime tiers. Following all of these things, and no doubt other actions I have missed, BA may now feel that it has too many customers at higher tiers and now wishes to recalibrate its programme, seemingly to achieve fewer customers at higher tiers. It doesn't mean that someone properly/appropriately achieving Gold or GGL under the old system is undesirable, it just means that BA has determined that it wishes to spend less in benefits for them via the BAC. That is its strategy based on its analysis - I am not sure there is much more to say. And clearly, this is in the context of a strategy to consolidate much more spend via credit cards and on travel with themselves, like the major US carriers. I suspect this will be harder to achieve in the UK than the US.