Originally Posted by UnitedSkies
The unknown variable is how likely a refunded ticket due to a lost bag will lead disserviced customers to fly with Independence Air again. Is there incremental revenue to be had with this? I'm not too sure about that given that it's not likely that by refunding the fare as a credit, that you will get 100% of disserviced passengers back.
That is a good point; however, I believe most will come back... especially if they have a free segment credited to their account. Probably everyone in here has had an airline lose a bag, and even without a free flight have gone right back to the same airline... because you can pretty much expect the same thing at most airlines. Probably the deciding factor on whether a person flys an airline again after having their bag lost is how they are treated after the fact.
Whether the service generates revenue will have to be seen, but I think the chances are good. First, everyone gets a coupon for future travel... so sales should be boosted by that. Second, according to the DOT numbers DH has a 99.7% baggage match number, so for every 1000 passengers that fly, DH will only have to credit 3
segments. Third, DH isn't really refunding anything... they are crediting your account with a free flight segment for use up to one year from when your bag was lost. So no money actually goes out, however since most people don't fly one-way segments there will probably be revenue generated from the purchase of another one-way segment for the person to get back. Also, there will be that small percentage that don't fill out the request for a credit form, or who never use the credit.