AC says Elites "cheapen" their business class
Oct 26, 2014, 12:55 pm
#91
FlyerTalk Evangelist
Join Date: Jun 2003
Location: YYC
Posts: 23,808
Your comments and tone are not constructive to a discussion with AC. If you don't want us to participate on here then just say so. All of us at AC will stop replying or discussing anything with you personally on a public forum effective now. A few months ago Ben Lipsey (who we met off this site before he joined AC) personally convinced me to have AC officially rejoin the conversation on FT in the open transparent manner that you have seen take place over the last few months. We choose to post under our real names and therefore the conversation can be challenging at times.
More disquieting, however, the words used reveal a certain attitude. Which I had hoped belonged in the past.
Air Canada has consistently produced a lower profit margin than our NA peers. Although over the last few years we have made big strides in improving our bottom line even in 2013 WS AA DL all outperformed us from an EBITDAR perspective. Our current model which includes many things needs to better adapt to our marketplace in order for us to improve our financial position and reach higher overall margins. We are a service business and in order to strive and succeed we need to significantly improve in many customer facing areas of our business. When it came time to decide on what type of product to put on our new 787s as well as our new fleet of 737MAX aircraft we needed to choose how best to position ourselves to improve our service while also expanding our margins. Having best-in-class J seats and lower than average premium revenues (which is what we currently have on many routes) is not a sustainable strategy. We don't expect all of our J customers to be paying full J fares all the time but we do need the average fare to improve to justify the investments we are making. We have experimented with lower quality J products and you will now see us move toward a more uniform product across our fleet. We did not expect to get this changeover 100pct correct and are open to tweaks where they make sense.
Most of that, we cannot disagree with. I may not like it, but I do understand that what is happening at the low end makes sense and seems to be working.
While i may be more skeptical about the high end strategy, it is obviously AC's prerogative to make their choice.
However what *IS* objectionable is to come with this major downgrade, especially for SEs, by surprise at the very end of the Q mile accumulation period. Furthermore, since most of the new fleet will still take a while to arrive, it is not obvious to me that such a radical change needed to be made in the way at was and at this time.
(For the record, I think for the time being i can live with the changes so I don't need to be overly emotional. )
Oct 26, 2014, 12:56 pm
#92
Suspended
Original Poster
Join Date: Dec 2010
Posts: 4,153
"I thought it's important to highlight this statement. I will refrain from adding too much commentary but would like a) people to know it's been said and b) ask how you frequent fliers making use of your E-ups feel about being told that when you do you in fact cheapen AC's product? Comment on please..."
That's how it started. No toys. No tantrums.
That's how it started. No toys. No tantrums.
Oct 26, 2014, 12:57 pm
#93
Join Date: Jul 2010
Location: Back in YYZ after 3 years of expat life in LHR
Programs: AC SE100K
Posts: 924
I'm not trying to speak on his behalf, but its clearly not a sound business model to be giving away something for nothing. To me its like going to the grocery store and paying for ground beef but getting prime rib or filet mignon! Of course once you get a taste for that filet mignon at the hamburger price you begin to expect it and inevitably people get bent out of shape when they don't get it, but why should they?? If simply shopping at the same store (or in this case flying the same airline) all the time was a measure of who should get what and in what order than travelling in general would be much different across all modes, not just airlines!!
Are they free? According to the PC program, they came at a cost - that cost was shopping at their stores, using their credit card (and also handing them a bunch of marketing info because they can now track what I'm buying).
An elite flyer, using the program as designed by the airline, isn't getting anything "free". The cost is using their airline, or their partner credit card, or their alliance partner, paying their prices (and also handing them a bunch of marketing info because they can now track my buying and flying patterns).
Oct 26, 2014, 1:00 pm
#94
Join Date: Jul 2013
Programs: ACAlt,SPG,MR
Posts: 64
Quote:
Originally Posted by Stranger
But the real sad part, his words reveal what AC insiders think of their best customers. We are the enemy it appears.
When did I say at all that you are the enemy? Or that we don't value our customers? What I said was that paying for Y and regularly getting J is not a sustainable business practice. Period.
Originally Posted by Stranger
But the real sad part, his words reveal what AC insiders think of their best customers. We are the enemy it appears.
When did I say at all that you are the enemy? Or that we don't value our customers? What I said was that paying for Y and regularly getting J is not a sustainable business practice. Period.
Remember that most of the value proposition of the program is available through other cheaper avenues than overpaying for Y seats and when answering repeating a baggage allowance or priority line access as a benefit that most FF are aware of these but as AC has monetized those through selling them as a benefit to CC companies etc. it is easy now to place the value that AC puts on these benefits and it doesn't come close to the extra spend for Flex and above...
I think that is the root of the anger of a lot of the posts. Your business decision is rational and the reasons are legitimate (as good as any I suppose) but I for one just can no longer make the value proposition work for me and it seems a lot of others are feeling the same.
Care to wade into what you feel are the current or future benefits that will tilt the proposition back in AC's favour?
Oct 26, 2014, 1:02 pm
#95
Join Date: Nov 2013
Posts: 492
Your comments and tone are not constructive to a discussion with AC. If you don't want us to participate on here then just say so. All of us at AC will stop replying or discussing anything with you personally on a public forum effective now. A few months ago Ben Lipsey (who we met off this site before he joined AC) personally convinced me to have AC officially rejoin the conversation on FT in the open transparent manner that you have seen take place over the last few months. We choose to post under our real names and therefore the conversation can be challenging at times. We fully expect to hear both positive and negative posts about how we run our business and the reason we participate here is to share some of our thinking and hear opinions from our customers on what improvements and/or changes they would like to see. We have listened to many of the various suggestions from this board and over the past few months when appropriate have instituted several ideas that came directly from FT members.
Having said that, while rude comments have no place anywhere, I think it's no surprise that people are really angry and upset. And especially with the people flying over 100K miles or 95 segments - it's tiring and time consuming - people give up their lifestyles due to their jobs - and it can easily become very personal.
In that case the best way for a company is to acknowledge that people are upset, and perhaps offer a solution or a comment that "we'll take your comments in and we'll going to work on it" - instead of adding fuel to the fire.
It is good that the AC reps on here talking, but sometimes discretion is advised - especially when the mood is not good. A wrong word leads down into a slippery slope of words and it could have been better that the word was never said in the first place. In the real world, if I was to enter a room full of angry people, I would stay quiet, appease, or offer solutions, or comments that are constructive, and not try to be stubborn or debate.
Air Canada has consistently produced a lower profit margin than our NA peers. Although over the last few years we have made big strides in improving our bottom line even in 2013 WS AA DL all outperformed us from an EBITDAR perspective. Our current model which includes many things needs to better adapt to our marketplace in order for us to improve our financial position and reach higher overall margins. We are a service business and in order to strive and succeed we need to significantly improve in many customer facing areas of our business. When it came time to decide on what type of product to put on our new 787s as well as our new fleet of 737MAX aircraft we needed to choose how best to position ourselves to improve our service while also expanding our margins. Having best-in-class J seats and lower than average premium revenues (which is what we currently have on many routes) is not a sustainable strategy. We don't expect all of our J customers to be paying full J fares all the time but we do need the average fare to improve to justify the investments we are making. We have experimented with lower quality J products and you will now see us move toward a more uniform product across our fleet. We did not expect to get this changeover 100pct correct and are open to tweaks where they make sense. We are more than happy to take comments and views from our customers.
My view and comment is that I think the cuts were too drastic and some more revision and tweaks/refinements should be made. I sincerely hope that AC would go back to the drawing board and make revisions that provides the right balance.
If eupgrades cannot be increased / eupgrade costs cannot be lowered, I believe having the ability to purchase eupgrades (maybe to a maximum limit of 70 credits per year to equalize it to what it the equivalent was before) at a reasonable price when one runs out would be an excellent way to keep customers happy, while allowing Air Canada to increase average revenue earned on J. Again, it's about achieving the right balance.
Oct 26, 2014, 1:04 pm
#96
Suspended
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
Absolutely. Updating my resume as we speak since I cannot sustain flying domestically with the new FF. It's not a threat or anything, just reinforcing what theseatbelt put very eloquently. Now having said that, personal attacks should never ever happen. It's not productive and/or a nice thing to do.
Oct 26, 2014, 1:05 pm
#97
Join Date: Dec 2007
Location: YYJ
Programs: AC SE*MM, Bonvoy LT Plat, HH Gold, National EE, Sixt Plat, Hz 5*
Posts: 2,441
Hi Ben,
What is the opinion of the unlimited upgrades on domestic/transborder latitude flight passes? Are these benefits here to stay or will they be going the way of the eupgrades?
I know that later in the thread Mr. Smith has stated that the goal is to increase the average revenue per seat mile, or something to that effect.
Some clarity would be appreciated.
Thanks
Oct 26, 2014, 1:12 pm
#98
Join Date: Nov 2010
Location: YYZ
Programs: NEXUS; *A Gold
Posts: 990
No toy tossing?? Seriously?? The majority of posts in this thread have been about how 'sad' people feel that the big, bad corporation is taking away some of the toys all of the children were used to playing with in favour of giving them to other children who wish to pay more for them.
There have been so many posts in various threads about how there should be less inclusion in the lounges, less inclusion in the J cabin, etc etc etc yet when it begins to happen the same people are moaning about having their feelings hurt because a real person from the nasty corporation has taken the time to respond instead of having an unpaid intern monitor the social media feeds.
As valuable as FT is for sharing information it can quickly become incredibly toxic when people feel they've somehow been wronged by an airline. If you're really so upset with the way either of the Ben's have posted on here to the point where your view of AC has changed then walk away, take your corporate/personal travel with you and don't forget to turn off the light when you leave.
There have been so many posts in various threads about how there should be less inclusion in the lounges, less inclusion in the J cabin, etc etc etc yet when it begins to happen the same people are moaning about having their feelings hurt because a real person from the nasty corporation has taken the time to respond instead of having an unpaid intern monitor the social media feeds.
As valuable as FT is for sharing information it can quickly become incredibly toxic when people feel they've somehow been wronged by an airline. If you're really so upset with the way either of the Ben's have posted on here to the point where your view of AC has changed then walk away, take your corporate/personal travel with you and don't forget to turn off the light when you leave.
Oct 26, 2014, 1:20 pm
#99
Join Date: Nov 2010
Location: YYZ
Programs: NEXUS; *A Gold
Posts: 990
President's Choice disagrees with you. If I use my PC Mastercard at their stores and collect their points to buy ground beef, after a certain amount of spend, I get "something for nothing" - the $XX in "free" groceries (the filet).
Are they free? According to the PC program, they came at a cost - that cost was shopping at their stores, using their credit card (and also handing them a bunch of marketing info because they can now track what I'm buying).
An elite flyer, using the program as designed by the airline, isn't getting anything "free". The cost is using their airline, or their partner credit card, or their alliance partner, paying their prices (and also handing them a bunch of marketing info because they can now track my buying and flying patterns).
Are they free? According to the PC program, they came at a cost - that cost was shopping at their stores, using their credit card (and also handing them a bunch of marketing info because they can now track what I'm buying).
An elite flyer, using the program as designed by the airline, isn't getting anything "free". The cost is using their airline, or their partner credit card, or their alliance partner, paying their prices (and also handing them a bunch of marketing info because they can now track my buying and flying patterns).
Oct 26, 2014, 1:22 pm
#100
Join Date: Oct 2009
Location: YUL
Programs: AC SE (*A Gold), Bonvoy Platinum Elite, Hilton Gold, Amex Platinum / AP Reserve, NEXUS, Global Entry
Posts: 5,691
I believe the point of this thread is to make it personal..... to what ends I have no idea, but it is rather pathetic. The AC forum was pretty lame all of six months ago with the same silly questions and boring threads. The AC presence here as really made it interesting again. To lose them because certain members want to bait AC staffers or embarrass would be a shame.
Oct 26, 2014, 1:24 pm
#101
Join Date: Jul 2005
Location: Ontario, CAN
Posts: 5,813
Great .... Sounds like we can look forward to more whining from flyers unable and unwilling to move on and less actual input from insiders and leaders within AC.
Isn't this just delightful.
Winners in life pull up their big-boy pants, wipe the tears away and move on to the product that best suits their needs in the marketplace. Sure, announce the changes AC have made will cost them your business. Let your actions speak.
Winners don't throw pity parties for pages and pages, winners don't slice and dice words to gin up some anger/pushback, winners don't callout company reps like some internet basement keyboard warrior
How embarassing
Isn't this just delightful.
Winners in life pull up their big-boy pants, wipe the tears away and move on to the product that best suits their needs in the marketplace. Sure, announce the changes AC have made will cost them your business. Let your actions speak.
Winners don't throw pity parties for pages and pages, winners don't slice and dice words to gin up some anger/pushback, winners don't callout company reps like some internet basement keyboard warrior
How embarassing
Oct 26, 2014, 1:24 pm
#102
Suspended
Original Poster
Join Date: Dec 2010
Posts: 4,153
No toy tossing?? Seriously?? The majority of posts in this thread have been about how 'sad' people feel that the big, bad corporation is taking away some of the toys all of the children were used to playing with in favour of giving them to other children who wish to pay more for them.
There have been so many posts in various threads about how there should be less inclusion in the lounges, less inclusion in the J cabin, etc etc etc yet when it begins to happen the same people are moaning about having their feelings hurt because a real person from the nasty corporation has taken the time to respond instead of having an unpaid intern monitor the social media feeds.
As valuable as FT is for sharing information it can quickly become incredibly toxic when people feel they've somehow been wronged by an airline. If you're really so upset with the way either of the Ben's have posted on here to the point where your view of AC has changed then walk away, take your corporate/personal travel with you and don't forget to turn off the light when you leave.
There have been so many posts in various threads about how there should be less inclusion in the lounges, less inclusion in the J cabin, etc etc etc yet when it begins to happen the same people are moaning about having their feelings hurt because a real person from the nasty corporation has taken the time to respond instead of having an unpaid intern monitor the social media feeds.
As valuable as FT is for sharing information it can quickly become incredibly toxic when people feel they've somehow been wronged by an airline. If you're really so upset with the way either of the Ben's have posted on here to the point where your view of AC has changed then walk away, take your corporate/personal travel with you and don't forget to turn off the light when you leave.
If anyone could make a valid point how these changes will benefit my favorite airline I am all ears.
As I said, if the execs can't make money on an an airline with privileged market position and can only think of blaming their most loyal customers, perhaps they should look for a new line of work.
Years of marketing double speak have not made trusting ACs future value proposition very easy.
As some say, fix the airline THEN ask for more money and our continued blind loyalty.
I have listed what I think would make AC a great airline. Curiously Ben S hasn't jumped on the opportunity to explain when caviar, private transport and nannies on board will be offered to compel us now to spend a premium on crud-encrusted squeaky pods until the alcantara clad interiors arrive.
No, to those who think I am faciscious, those are all things other airlines offer, perhaps some of those features only in F, but as I pointed out, I can buy cheaper J with them and have a chance of an upgrade to F while being guaranteed an updated premium product RIGHT NOW. My spend will go to them after meeting the 50k minimum (using eUPs along the way), AC will see no increase in J spend and indeed drive additional spend to their competition. Brilliance brought to you by the AC gods.
AC is delusional if they think we are suckers.
Oct 26, 2014, 1:28 pm
#103
Join Date: Sep 2014
Location: sqrt(-united states of apologist)
Programs: *$ Green
Posts: 5,403
President's Choice disagrees with you. If I use my PC Mastercard at their stores and collect their points to buy ground beef, after a certain amount of spend, I get "something for nothing" - the $XX in "free" groceries (the filet).
Are they free? According to the PC program, they came at a cost - that cost was shopping at their stores, using their credit card (and also handing them a bunch of marketing info because they can now track what I'm buying).
An elite flyer, using the program as designed by the airline, isn't getting anything "free". The cost is using their airline, or their partner credit card, or their alliance partner, paying their prices (and also handing them a bunch of marketing info because they can now track my buying and flying patterns).
Are they free? According to the PC program, they came at a cost - that cost was shopping at their stores, using their credit card (and also handing them a bunch of marketing info because they can now track what I'm buying).
An elite flyer, using the program as designed by the airline, isn't getting anything "free". The cost is using their airline, or their partner credit card, or their alliance partner, paying their prices (and also handing them a bunch of marketing info because they can now track my buying and flying patterns).
But for a FFP, this is not the case. Through a loyalty program, the company agrees to forgo part of their profit margin to reward you for your spending. In this situation, the equilibrium is extremely fragile. A normal behaviour for the customer would be to maximize his benefits through the FFP, while minimizing its cost to get these benefits. By doing the most logical thing, the customer is actually squeezing the company, and they then make decisions on whether the relationship should continue or not.
No one will know exactly what is going on in AC, unless you work for the company and can see the actual numbers.
What I find funny is just that some people seem to think that AC woke up one day saying: "hey guys, how about we piss off our most profitable customers for no apparent reason at all?"
Oct 26, 2014, 1:32 pm
#104
Join Date: Sep 2014
Location: sqrt(-united states of apologist)
Programs: *$ Green
Posts: 5,403
I put in the money to buy planes and the infrastructure to bring people from A to Z. And I am taking all the financial risks of running this company.
Either you pay the price that I charge in order to pay for these costs and get a decent return for the risk I am taking, or take one of the following two options:
1. Fly on another company.
2. If #1 is not available, then build your own airline and try to undercut me.
If both 1 and 2 cannot be done, then basic economics indicate that I should maybe charge even more for the service I am providing.
Oct 26, 2014, 1:35 pm
#105
Join Date: Jul 2007
Location: Flew over the Equator 55 times last 3 years
Programs: LANPASS Comodoro (Emerald), others
Posts: 2,957
Your comments and tone are not constructive to a discussion with AC. If you don't want us to participate on here then just say so. All of us at AC will stop replying or discussing anything with you personally on a public forum effective now. A few months ago Ben Lipsey (who we met off this site before he joined AC) personally convinced me to have AC officially rejoin the conversation on FT in the open transparent manner that you have seen take place over the last few months. We choose to post under our real names and therefore the conversation can be challenging at times. We fully expect to hear both positive and negative posts about how we run our business and the reason we participate here is to share some of our thinking and hear opinions from our customers on what improvements and/or changes they would like to see. We have listened to many of the various suggestions from this board and over the past few months when appropriate have instituted several ideas that came directly from FT members.
Air Canada has consistently produced a lower profit margin than our NA peers. Although over the last few years we have made big strides in improving our bottom line even in 2013 WS AA DL all outperformed us from an EBITDAR perspective. Our current model which includes many things needs to better adapt to our marketplace in order for us to improve our financial position and reach higher overall margins. We are a service business and in order to strive and succeed we need to significantly improve in many customer facing areas of our business. When it came time to decide on what type of product to put on our new 787s as well as our new fleet of 737MAX aircraft we needed to choose how best to position ourselves to improve our service while also expanding our margins. Having best-in-class J seats and lower than average premium revenues (which is what we currently have on many routes) is not a sustainable strategy. We don't expect all of our J customers to be paying full J fares all the time but we do need the average fare to improve to justify the investments we are making. We have experimented with lower quality J products and you will now see us move toward a more uniform product across our fleet. We did not expect to get this changeover 100pct correct and are open to tweaks where they make sense. We are more than happy to take comments and views from our customers but I'm not prepared to have you bully one of our most dedicated employees on a public site. If you have an issue with Ben L personally please PM me directly.
Air Canada has consistently produced a lower profit margin than our NA peers. Although over the last few years we have made big strides in improving our bottom line even in 2013 WS AA DL all outperformed us from an EBITDAR perspective. Our current model which includes many things needs to better adapt to our marketplace in order for us to improve our financial position and reach higher overall margins. We are a service business and in order to strive and succeed we need to significantly improve in many customer facing areas of our business. When it came time to decide on what type of product to put on our new 787s as well as our new fleet of 737MAX aircraft we needed to choose how best to position ourselves to improve our service while also expanding our margins. Having best-in-class J seats and lower than average premium revenues (which is what we currently have on many routes) is not a sustainable strategy. We don't expect all of our J customers to be paying full J fares all the time but we do need the average fare to improve to justify the investments we are making. We have experimented with lower quality J products and you will now see us move toward a more uniform product across our fleet. We did not expect to get this changeover 100pct correct and are open to tweaks where they make sense. We are more than happy to take comments and views from our customers but I'm not prepared to have you bully one of our most dedicated employees on a public site. If you have an issue with Ben L personally please PM me directly.
Interesting to watch this social media experiment develop wrt this thread and others.
http://www.flyertalk.com/forum/23509851-post1082.html