<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by Weatherboy:
If airlines are hesitant to accept miles as cash, rather than make it difficult to redeem the cash, they should just make it harder to earn the cash (i.e.: no more comp'd status matches, no more quadruple mileage bonus, etc.)</font>
But CO wants to eat their cake and have it too! They want the marketing benefits provided by enticing flyers with FF miles and bonuses, and building loyalty with status comps, but without having to pay for them with the "free" flights and upgrades that those programs inevitably cost.
<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by Weatherboy:
By making it harder for those with mileage and status to redeem their miles, they're alienating the purpose the FF system exists: to keep high revenue, frequent travelers loyal with their company.</font>
But there is a gap between the time frequent flyers earn the mileage and when they spend it. For months, or even years, the FF will accumulate miles, giving much needed revenue to the airline. Only later, when s/he tries to redeem the miles, will the FF begin to realize that s/he has been bilked. At this point, most of those customers will angrily leave the airline. And the airline will be in worse shape than previously, as now it has acquired a reputation for dishonest business dealings.
Most marketing people realize this. It's far cheaper to keep an existing customer, than it is to acquire a new one. And it takes years for a business to develop a good reputation. But that good reputation can be destroyed very quickly!
But Kellner and his bean counters are only looking at this month's income statement. If they can sell one extra full-fare ticket today, they don't care if their tactics might lose them many more repeat customers over the long run.
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"Read my lips! No more benefit cuts!"...Gordon Bethune