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CO Is Uncompetitive with Lifetime Benefits

 
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Old Aug 3, 2007, 12:44 pm
  #76  
 
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The business model has both a short-term and a long-term component. For argument's sake, short-term would be the impact on behavior prior to reaching the target (whatever it is, based on miles or years). Long-term would be the impact on behavior after reaching the target.

Short-Term - Positives
+1 Customers will have more of an incentive to "stretch" their travel on CO in order to achieve the target ... this translates to incremental revenues.
+2 This affects both customers who do reach that level (call them "R") and those who will eventually fall off (call them "F"). If you structure the program correctly, you'll have far more "Fs" than "Rs" ... so you affect the behavior of many, but owe benefits to only a few.
+3 There are people who occasionally "shop" for a program to which to be loyal; typically this might be associated with a job move or physical move. When deciding on a program to which to be loyal for the next 5-10 years, the existence of a lifetime status might become the deciding factor between selecting CO vs. another airline

Short-Term - Negatives
-1 Some startup and administration costs in announcing and adjudicating the program.

Long-Term - Positives
+4 Once someone has lifetime status, even though they don't have to re-qualify, they may choose to fly CO because they get benefits.

Long-Term - Negatives
-2 Some customers who now have achieved "lifetime" status will stop flying MRs and shifting flights to CO just to maintain status. This represents lost income. To some extent, this could be mitigated by a "tiered" program like AA, where in effect 1 Million miles gives you lifetime Silver, then 2 Million Gold and 3 Million Platinum (and above that, the population becomes de minimus
-3 Customers who have previously "earned" the status are devaluing the ability of current customers to avail themselves of upgrades. I think this "problem" is a bit of a red herring. If the customers continue to fly frequently enough to become a problem, they'll be requalifying anyway. If they stop flying, well, they aren't trying to get upgraded. And in-between, if they fly infrequently, they become a "burden" in these infrequent cases. But how many people will actually be in this category? And further, it could be mitigated by the abovementioned AA-like program, where the majority of people would be lifetime Silver (which doesn't really expect to get upgraded) and only a handful would be lifetime Platinum. Heck, you could even have the Lifetime Platinums have priority inbetween Golds and Platinums if this is really a concern and not a red herring.
-4 If a program is annouced and then cancelled, that will have negative morale impacts on the airline. I was in my 4th year of the "Infinite Elite" program when it was abruptly cancelled, and rudely so, since CO did not even grandfather in people like me who had 4 years under our belt. This caused me to switch to flying NW, but I have since regained my senses.

There may be more, but I think both the short term and the long term benefits outweigh the costs. I know in my own case, the lifetime programs with KL/AF, with AA and with UA have caused me to fly each of these carriers more. And in the case of CO and BA, the lack has had the opposite effect.
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Old Aug 3, 2007, 2:53 pm
  #77  
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Lifetime Status

Maybe long-timers should get lifetime status that is one notch below their current level of maintaining such status over 10 years. IE: A 10-year Platinum would be Gold for life while a 10-year Gold would be silver for life. And each would get enough EQM's to keep them there.... so if a 10+yr Platinum wanted to stay Platinum, they'd just have to fly 25k EQM's to maintain their top-tier status.

This way the flyer is incented to fly ...while CO doesn't' dilute the elite ranks too much.
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Old Aug 3, 2007, 3:57 pm
  #78  
 
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Originally Posted by Weatherboy
Maybe long-timers should get lifetime status that is one notch below their current level of maintaining such status over 10 years. IE: A 10-year Platinum would be Gold for life while a 10-year Gold would be silver for life. And each would get enough EQM's to keep them there.... so if a 10+yr Platinum wanted to stay Platinum, they'd just have to fly 25k EQM's to maintain their top-tier status.

This way the flyer is incented to fly ...while CO doesn't' dilute the elite ranks too much.
WOW, I actually like that idea. If gives one a reason to fly and at the same time gives one the ablity to earn lifetime status. It seems like something more inline with CO.
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Old Aug 3, 2007, 6:11 pm
  #79  
xFF
 
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Originally Posted by vsevolod4
If a program is annouced and then cancelled, that will have negative morale impacts on the airline. I was in my 4th year of the "Infinite Elite" program when it was abruptly cancelled, and rudely so, since CO did not even grandfather in people like me who had 4 years under our belt.
Wow! I didn't know that happened. Was your first Gold year 94 or 95? IIRC, '97 was the last year of the program, but I seem to remember a former colleague who got his through '98. The 90's are a bit of a blur for me.

You're right, though: that would really s..k. It would have to be grandfathered in some way.

Edit: I just phoned up my old friend and he says he vested Inf. through '97. He also recalls CO did announce "no mas" to Infinite qualification starting in '94.

Last edited by xFF; Aug 3, 2007 at 6:58 pm Reason: Correction
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Old Aug 3, 2007, 7:06 pm
  #80  
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Originally Posted by Weatherboy
Maybe long-timers should get lifetime status that is one notch below their current level of maintaining such status over 10 years. IE: A 10-year Platinum would be Gold for life while a 10-year Gold would be silver for life. And each would get enough EQM's to keep them there.... so if a 10+yr Platinum wanted to stay Platinum, they'd just have to fly 25k EQM's to maintain their top-tier status.

This way the flyer is incented to fly ...while CO doesn't' dilute the elite ranks too much.
That's a nice simple approach. I think it would be workable!
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Old Aug 3, 2007, 7:09 pm
  #81  
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Originally Posted by xFF
Wow! I didn't know that happened. Was your first Gold year 94 or 95? IIRC, '97 was the last year of the program, but I seem to remember a former colleague who got his through '98. The 90's are a bit of a blur for me.

You're right, though: that would really s..k. It would have to be grandfathered in some way.

Edit: I just phoned up my old friend and he says he vested Inf. through '97. He also recalls CO did announce "no mas" to Infinite qualification starting in '94.
I understood that the program ended in 1992 or '93. A few people have made this comment. So, it sounds to me like the program ended in 1993, if your friend hit the status in '97.
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Old Aug 3, 2007, 7:25 pm
  #82  
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CO Insider

Originally Posted by ContinentalFan
That's a nice simple approach. I think it would be workable!
I'm sure CO Insider is taking notes from this thread
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Old Aug 3, 2007, 7:43 pm
  #83  
xFF
 
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Originally Posted by ContinentalFan
So, it sounds to me like the program ended in 1993, if your friend hit the status in '97.
Yes, and it also seems like the program was "grandfathered" -- those who started by '93 were allowed the opportunity to complete, and it was announced that first Gold in '94 would not vest.
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Old Aug 4, 2007, 12:06 pm
  #84  
 
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Originally Posted by xFF
Yes, and it also seems like the program was "grandfathered" -- those who started by '93 were allowed the opportunity to complete, and it was announced that first Gold in '94 would not vest.
Just wondering since i never kept records, would Co be able to tell someone their elite status history?
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Old Aug 4, 2007, 1:21 pm
  #85  
 
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Originally Posted by Weatherboy
Maybe long-timers should get lifetime status that is one notch below their current level of maintaining such status over 10 years. IE: A 10-year Platinum would be Gold for life while a 10-year Gold would be silver for life. And each would get enough EQM's to keep them there.... so if a 10+yr Platinum wanted to stay Platinum, they'd just have to fly 25k EQM's to maintain their top-tier status.

This way the flyer is incented to fly ...while CO doesn't' dilute the elite ranks too much.
I, too, think this is a simple yet effective way to implement a Lifetime program. Being one of those who just missed out the last year the old program was in effect, sick parent requiring care cut down on travel at would’ve been my 5th year of gold status, I would welcome the addition of a new Lifetime program.

Let’s work on this at the coming DO III.
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Old Aug 4, 2007, 3:26 pm
  #86  
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Originally Posted by jerseygirl
Just wondering since i never kept records, would Co be able to tell someone their elite status history?
Yes, CO has a complete history of flights that you have taken. I don't recall why I asked CO the question a few years ago, but I wanted some information from the carrier, I ended up getting a print out of every flight I took since 1993--it should be easy to calculate the elite history of an OP member.
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Old Aug 5, 2007, 9:30 am
  #87  
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Do Issue

Originally Posted by From NYC
I, too, think this is a simple yet effective way to implement a Lifetime program. Being one of those who just missed out the last year the old program was in effect, sick parent requiring care cut down on travel at would’ve been my 5th year of gold status, I would welcome the addition of a new Lifetime program.

Let’s work on this at the coming DO III.
One of the reasons CO mentioned at the last 'Do why they weren't pursuing some sort of lifetime program was that because once you start it you can't easily get out ...and once you start it, you have to deal with going through the records and sorting things out from past travel to "grandfather" people in.

If CO announced a program today that starting today, 10 consecutive years of Platinum or 2million EQMs will get you some type of lifetime benefit, would you bite? Or would you be upset that your travel up to today wouldn't be counted?
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Old Aug 5, 2007, 10:13 am
  #88  
 
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Originally Posted by Weatherboy
One of the reasons CO mentioned at the last 'Do why they weren't pursuing some sort of lifetime program was that because once you start it you can't easily get out ...and once you start it, you have to deal with going through the records and sorting things out from past travel to "grandfather" people in.

If CO announced a program today that starting today, 10 consecutive years of Platinum or 2million EQMs will get you some type of lifetime benefit, would you bite? Or would you be upset that your travel up to today wouldn't be counted?
If they had the records, which I'm sure they do, I would not be very happy if the ignored all my past travel.
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Old Aug 5, 2007, 10:29 am
  #89  
 
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Clearly CO would have to grandfather some people into the program. It would seem to be a very big mistake to start from scratch.
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Old Aug 5, 2007, 10:44 am
  #90  
 
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Insufficient space for upgrades

As even Platinum Elites have difficulties getting upgrades on flights, Continental shouldn't move on offering Lifetime elite benefits until Continental had sufficient upgrade space for all elites, including silver elites.

Jiburi
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