AC Presence on FT
Jan 3, 2015, 11:17 am
#1426
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Join Date: Jun 2009
Location: YYZ
Programs: AC E50K (*G) WS Gold | SPG/Fairmont Plat Hilton/Hyatt Diamond Marriott Silver | National Exec Elite
Posts: 19,284
Same as with sales/discounting. You never see sales (well barely) in Lululemon retail stores as it cheapens (Yes, I am using that word carefully) the brand. - same sort of thing as eUpgrades (oh no, here we go again!)
PS Wow, I never thought i'd be talking about Lululemon yoga pants on FlyerTalk
Jan 3, 2015, 11:18 am
#1427
Join Date: Jul 2005
Location: YYZ
Programs: AC*SE,MM
Posts: 363
You didn't, but lots of others have. Apologies.
Jan 3, 2015, 11:24 am
#1428
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Location: YYZ
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Because i'm too lazy to write up what I was talking about selling to a target customer as a marketing strategy, a simple search engine lookup resulted in this - which I think sums it up nicely.
http://sbinfocanada.about.com/cs/mar...rgetmarket.htm Page 2 is what you want to see, although Page 1 is a good intro!
http://sbinfocanada.about.com/cs/mar...rgetmarket.htm Page 2 is what you want to see, although Page 1 is a good intro!
Jan 3, 2015, 11:25 am
#1429
Join Date: Jul 2005
Location: YYZ
Programs: AC*SE,MM
Posts: 363
Ensco... why do you say that AC, "need to make choices"? I don't understand why any business would want to pick and choose one demographic over another.
I know that at my company I wouldn't last long if the boss thought I was providing less of a service or was indifferent to the needs of a smaller client, just because we also have bigger ones.
Who knows how small, the small client is going to be come this time next year.
In my simplistic view it's surely better to try to keep as many customers as you can, big and small. But then maybe that's why I'm not in management.
I know that at my company I wouldn't last long if the boss thought I was providing less of a service or was indifferent to the needs of a smaller client, just because we also have bigger ones.
Who knows how small, the small client is going to be come this time next year.
In my simplistic view it's surely better to try to keep as many customers as you can, big and small. But then maybe that's why I'm not in management.
It's not they want to, it's that the people who run AC are paid to increase overall revenues and profits, and at the margin that always involves choices of some sort, in businesses with the size and market share dominance of AC.
The value of getting corporate buyers to allow J in some cases is obviously so great that AC are willing to lose or forego a lot to try to get that.
In fact, making SEs angry about these changes may be a conscious choice to get the travel departments to change. Face it, the end customer is going to be a lot better at making that case to his/her own travel department than AC ever will.
Jan 3, 2015, 11:26 am
#1430
Join Date: Mar 2010
Location: Edmonton
Posts: 187
To continue the Lululemon analogy.
With AC culling the FF herd it seems to me to be like Lululemon having a buy 4, get a discount on the 5th. Then refusing to sell the 4th outfit to avoid giving a discount on the 5th. (I guess they figure they can just sell the 5th at full price to the next customer)
With AC culling the FF herd it seems to me to be like Lululemon having a buy 4, get a discount on the 5th. Then refusing to sell the 4th outfit to avoid giving a discount on the 5th. (I guess they figure they can just sell the 5th at full price to the next customer)
Jan 3, 2015, 11:31 am
#1432
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Location: YYZ
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Posts: 19,284
To continue the Lululemon analogy.
With AC culling the FF herd it seems to me to be like Lululemon having a buy 4, get a discount on the 5th. Then refusing to sell the 4th outfit to avoid giving a discount on the 5th. (I guess they figure they can just sell the 5th at full price to the next customer)
With AC culling the FF herd it seems to me to be like Lululemon having a buy 4, get a discount on the 5th. Then refusing to sell the 4th outfit to avoid giving a discount on the 5th. (I guess they figure they can just sell the 5th at full price to the next customer)
The best analogy I can come up with (and I mean no disrespect to the UA lovers on this forum) is that AC which was like UA (frequent upgrades, fleet cleanliness, service etc) now wants to be like BR. The way it wants to accomplish this is to stop the discounting, start being premium by investing in new hard product, retraining soft product (hopefully) etc. To upgrade on BR, one needs to fly ~120,000 miles before a cert is even earned. But BR is considered more premium than AC (I don't think anyone will disagree with me here)
I'm going to guess that someone at AC finally figured out that running a subpar offering and charging lower fares (CX is a LOT more to HKG right now than AC) meant less revenue than charging higher fees and having a better overall product, while pissing off FFers and knowing how much revenue is lost in the process. If net profit improves, who cares about FFers? We're just pee-ons (as Nomad spelt it!
) To the big spenders on the board, other than one or two people that have said "good bye!" - and followed through, that's a drop in the bucket. To the SUPER spenders on the board, I have never seen one post of someone leaving AC...and they only fly paid J. (cue the >400,000 miles a year FTers here) - they are AC's bread and butter...not us. (say 2 J flights a week = 2*$5000. Say 40 flights a year, that means they bring in $450,000. As long as you don't piss this group off, you're fine. (and while I won't name names - those in this group, at least ones i've met and or PM'd, were angry at the devaluations but are sticking with the airline, but not nearly as angry as us (well me post hearing the news in that other thread! )
Last edited by superangrypenguin; Jan 3, 2015 at 11:40 am
Jan 3, 2015, 2:02 pm
#1433
Join Date: Apr 2011
Location: YYC
Programs: AC SE 1MM, Marriott Ambassador
Posts: 3,397
Does your business have $12B in revenues and 65% market share?
It's not they want to, it's that the people who run AC are paid to increase overall revenues and profits, and at the margin that always involves choices of some sort, in businesses with the size and market share dominance of AC.
The value of getting corporate buyers to allow J in some cases is obviously so great that AC are willing to lose or forego a lot to try to get that.
In fact, making SEs angry about these changes may be a conscious choice to get the travel departments to change. Face it, the end customer is going to be a lot better at making that case to his/her own travel department than AC ever will.
It's not they want to, it's that the people who run AC are paid to increase overall revenues and profits, and at the margin that always involves choices of some sort, in businesses with the size and market share dominance of AC.
The value of getting corporate buyers to allow J in some cases is obviously so great that AC are willing to lose or forego a lot to try to get that.
In fact, making SEs angry about these changes may be a conscious choice to get the travel departments to change. Face it, the end customer is going to be a lot better at making that case to his/her own travel department than AC ever will.
Jan 3, 2015, 2:09 pm
#1434
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Location: YYZ
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Posts: 19,284
I don't think it's in their interest or their shareholders interest to filter out corporate gobbly gook speech and say what's on their mind. Not sure if you work for a corporation, but it's full of this sort of stuff. We sort of hold AC to a double standard as a corporation...I'll admit.
Jan 3, 2015, 2:16 pm
#1435
Join Date: Apr 2011
Location: YYC
Programs: AC SE 1MM, Marriott Ambassador
Posts: 3,397
I don't think it's in their interest or their shareholders interest to filter out corporate gobbly gook speech and say what's on their mind. Not sure if you work for a corporation, but it's full of this sort of stuff. We sort of hold AC to a double standard as a corporation...I'll admit.
Jan 3, 2015, 2:18 pm
#1436
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Location: YYZ
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Posts: 19,284
Perhaps. I do work for a very large corporation, and I have a fair amount of first hand experience with engagement on social media. I would just say that the corporate "gobbly gook" never works on social media. Never. Clarity and honesty (or complete silence) are always always the best choice. Second lesson is to respect your audience.
Jan 3, 2015, 3:13 pm
#1437
Join Date: Sep 2005
Location: YOW
Programs: AC E75K *G
Posts: 7,107
When clothing stores all start selling essentially identical items and put multiple prices on each item where each price point refers to a different return policy, then we can talk analogies between airlines and clothing stores.
Jan 3, 2015, 4:00 pm
#1438
FlyerTalk Evangelist
Join Date: Jun 2007
Location: Toronto
Programs: UA 1K, AC MM E75, Marriott LT Ti, IHG Dia Amb, Hyatt Glob
Posts: 15,521
Buying Paint Airline Style
Ah yes, the paint analogy!
http://www.tysknews.com/LiteStuff/buying_paint.htm
First, a summary of how ordinary hardware stores sell their paint...
Customer: Hi. How much is your paint?
Clerk: We have regular quality paint for $18 a gallon and premium paint for $25. How many gallons would you like?
Customer: Five gallons of regular paint please.
Clerk: Great. That will be $90 plus tax.
Now, imagine you are buying paint from British Airways, United, Northwest, American, Delta, or ANY other full-fare airline in the world.
First you spend days trying to reach them by phone to ask if they have paint. Nobody answers. So you drive to their store, and the conversation goes something like this...
Customer: Hi. How much is your paint?
Clerk: Well, sir, that depends on quite a lot of things.
Customer: Can you give me a guess? Is there an average price?
Clerk: Our lowest price is $12 a gallon, and we have 60 different prices up to $200 a gallon.
Customer: What's the difference in the paint?
Clerk: Oh, there isn't any difference; it's all the same paint.
Customer: Well, then I'd like some of that $12 paint.
Clerk: When do you intend to use the paint?
Customer: I want to paint tomorrow. It's my day off.
Clerk: Sir, the paint for tomorrow is the $200 paint.
Customer: When would I have to paint to get the $12 paint?
Clerk: You would have to start very late at night in about 3 weeks. But you will have to agree to start painting before Friday of that week and continue painting until at least Sunday.
Customer: You've got to be kidding!
Clerk: I'll check and see if we have any paint available.
Customer: You have shelves FULL of paint! I can see it!
Clerk: But it doesn't mean that we have paint available. We sell only a certain number of gallons on any given weekend. Oh, and by the way, the price per gallon just went to $16. We don't have any more $12 paint.
Customer: The price went up as we were talking?
Clerk: Yes, sir. We change the prices and rules hundreds of times a day, and since you haven't actually walked out of the store with your paint yet, we just decided to change. I suggest you purchase your paint as soon as possible. How many gallons do you want?
Customer: Well, maybe five gallons. Make that six, so I'll have enough.
Clerk: Oh no, sir, you can't do that. If you buy paint and don't use it, there are penalties and possible confiscation of the paint you already have.
Customer: WHAT?
Clerk: We can sell enough paint to do your kitchen, bathroom, hall and north bedroom, but if you stop painting before you do the bedroom, you will lose your remaining gallons of paint.
Customer: What does it matter whether I use all the paint? I already paid you for it!
Clerk: We make plans based upon the idea that all our paint is used, every drop. If you don't, it causes us all sorts of problems.
Customer: This is crazy!! I suppose something terrible happens if I don't keep painting until after Saturday night!
Clerk: Oh yes! Every gallon you bought automatically becomes the $200 paint.
Customer: But what are all these "Paint on sale from $10 a gallon" signs?
Clerk: Well, that's for our budget paint. It only comes in half-gallons.
One $5 half-gallon will do half a room. The second half-gallon to complete the room is $20. None of the cans have labels, some are empty and there are no refunds, even on the empty cans.
Customer: To hell with this! I'll buy what I need somewhere else!
Clerk: I don't think so, sir. You may be able to buy paint for your bathroom and bedrooms and your kitchen and dining room from someone else, but you won't be able to paint your connecting hall and stairway from anyone but us. And I should point out sir, that if you paint in only one direction, it will be $300 a gallon.
Customer: I thought your most expensive paint was $200!
Clerk: That's if you paint around the room to the point at which you started. A hallway is different.
Customer: And if I buy $200 paint for the hall, but only paint in one direction, you'll confiscate the remaining paint?
Clerk: No, we'll charge you an extra use fee plus the difference On your next gallon of paint. But I believe you're getting it now, sir.
Customer: You're insane!
Clerk: Thanks for painting with us ... next person in the line, please.
http://www.tysknews.com/LiteStuff/buying_paint.htm
First, a summary of how ordinary hardware stores sell their paint...
Customer: Hi. How much is your paint?
Clerk: We have regular quality paint for $18 a gallon and premium paint for $25. How many gallons would you like?
Customer: Five gallons of regular paint please.
Clerk: Great. That will be $90 plus tax.
Now, imagine you are buying paint from British Airways, United, Northwest, American, Delta, or ANY other full-fare airline in the world.
First you spend days trying to reach them by phone to ask if they have paint. Nobody answers. So you drive to their store, and the conversation goes something like this...
Customer: Hi. How much is your paint?
Clerk: Well, sir, that depends on quite a lot of things.
Customer: Can you give me a guess? Is there an average price?
Clerk: Our lowest price is $12 a gallon, and we have 60 different prices up to $200 a gallon.
Customer: What's the difference in the paint?
Clerk: Oh, there isn't any difference; it's all the same paint.
Customer: Well, then I'd like some of that $12 paint.
Clerk: When do you intend to use the paint?
Customer: I want to paint tomorrow. It's my day off.
Clerk: Sir, the paint for tomorrow is the $200 paint.
Customer: When would I have to paint to get the $12 paint?
Clerk: You would have to start very late at night in about 3 weeks. But you will have to agree to start painting before Friday of that week and continue painting until at least Sunday.
Customer: You've got to be kidding!
Clerk: I'll check and see if we have any paint available.
Customer: You have shelves FULL of paint! I can see it!
Clerk: But it doesn't mean that we have paint available. We sell only a certain number of gallons on any given weekend. Oh, and by the way, the price per gallon just went to $16. We don't have any more $12 paint.
Customer: The price went up as we were talking?
Clerk: Yes, sir. We change the prices and rules hundreds of times a day, and since you haven't actually walked out of the store with your paint yet, we just decided to change. I suggest you purchase your paint as soon as possible. How many gallons do you want?
Customer: Well, maybe five gallons. Make that six, so I'll have enough.
Clerk: Oh no, sir, you can't do that. If you buy paint and don't use it, there are penalties and possible confiscation of the paint you already have.
Customer: WHAT?
Clerk: We can sell enough paint to do your kitchen, bathroom, hall and north bedroom, but if you stop painting before you do the bedroom, you will lose your remaining gallons of paint.
Customer: What does it matter whether I use all the paint? I already paid you for it!
Clerk: We make plans based upon the idea that all our paint is used, every drop. If you don't, it causes us all sorts of problems.
Customer: This is crazy!! I suppose something terrible happens if I don't keep painting until after Saturday night!
Clerk: Oh yes! Every gallon you bought automatically becomes the $200 paint.
Customer: But what are all these "Paint on sale from $10 a gallon" signs?
Clerk: Well, that's for our budget paint. It only comes in half-gallons.
One $5 half-gallon will do half a room. The second half-gallon to complete the room is $20. None of the cans have labels, some are empty and there are no refunds, even on the empty cans.
Customer: To hell with this! I'll buy what I need somewhere else!
Clerk: I don't think so, sir. You may be able to buy paint for your bathroom and bedrooms and your kitchen and dining room from someone else, but you won't be able to paint your connecting hall and stairway from anyone but us. And I should point out sir, that if you paint in only one direction, it will be $300 a gallon.
Customer: I thought your most expensive paint was $200!
Clerk: That's if you paint around the room to the point at which you started. A hallway is different.
Customer: And if I buy $200 paint for the hall, but only paint in one direction, you'll confiscate the remaining paint?
Clerk: No, we'll charge you an extra use fee plus the difference On your next gallon of paint. But I believe you're getting it now, sir.
Customer: You're insane!
Clerk: Thanks for painting with us ... next person in the line, please.
Jan 3, 2015, 4:56 pm
#1439
Suspended
Join Date: Sep 2014
Programs: AC SE100K-1MM, NH, DL, AA, BA, Global Entry/Nexus, APEC..
Posts: 18,877
Buying Paint Airline Style
margarita girl
Thanks for this. Actually brilliant. I did laugh. Sadly.
(of course, no one mentioned those "ancillary" add-ons, likes brushes.....)
margarita girl
Thanks for this. Actually brilliant. I did laugh. Sadly.
(of course, no one mentioned those "ancillary" add-ons, likes brushes.....)
Jan 3, 2015, 7:21 pm
#1440
Join Date: May 2012
Location: BKK/SIN/YYZ/YUL
Programs: DL, AC, Bonvoy, Accor, Hilton
Posts: 2,919
Perhaps. I do work for a very large corporation, and I have a fair amount of first hand experience with engagement on social media. I would just say that the corporate "gobbly gook" never works on social media. Never. Clarity and honesty (or complete silence) are always always the best choice. Second lesson is to respect your audience.