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Old Oct 22, 2007 | 8:51 am
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I believe that the booking bonus was originally institued as pairt of all airline's efforts to eliminate travel agent payments. The airlines made significantly more money on each ticket booked online even when giving 1,000 or 500 milies. I supsect there was a metric out there of some sort as in when X% of flights are booked online then bye, bye milies bonus. The airlines have won the war with travel agents so incentives are no longer needed. Most people book online. I don't know the business arrangements between an expedia/orbitz/travelocity and the airlines but assume it is such that the 500 mileage bonus is no longer a significant savings in abilty to book directly versus through a another site.

As for other changes, inflation happens (can't say I like it) but stuff does tend to get more expensive over time. That said, the airlines have always had a reverse model to the rest of the market. For some reason, the cost of seats goes up as it becomes more likely they will be come unsold.

If I were to call today for a flight tomorrow and there 10 empty seats in BF with a high chance at least several would go out empty they want to charge me more in money or miles. The argument being that I apy more for the convenince of them having a seat at the last moment. I don't feel that is actually a premium service because if the could have sold the seat they would have already.

I would love to see some kind of mileage auctions for last minute seats. That would truely determins the value of a seat... So possible now with today's tech.
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Old Oct 22, 2007 | 8:59 am
  #77  
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Personally, I love to see PE on CO. But I'm not holding my breath. Nor am I convinced it's a revenue bonanza for those who offer it. If it is, you'll see SQ, CX and so on jumping into the fray early on. Both of those airlines compete with BA, VS or BR on a lot of routes, but they decide to stay put. [And even SQ has PE on the 345, they decide not to do it on the A380; and QF is only putting like 2 rows of seats on theirs.] The future international heavyweights like EK, QR, etc also are not introducing them.

Anyways, if I were to design CO's 757 PE, I'll make it like the "business class" seats in European shorthauls. Convertible seats from 3-3 to 2-2 with more width and a wide armrest. [Perhaps add one or two inch of legroom, in CO's case.] Depends on PE/Y sales, they can convert the rows in a few minutes between the two products.
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Old Oct 22, 2007 | 9:06 am
  #78  
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Originally Posted by rkkwan
Anyways, if I were to design CO's 757 PE, I'll make it like the "business class" seats in European shorthauls. Convertible seats from 3-3 to 2-2 with more width and a wide armrest. [Perhaps add one or two inch of legroom, in CO's case.] Depends on PE/Y sales, they can convert the rows in a few minutes between the two products.
I'm not a fan of Euro-J, and would not pay the same sort of premium that BA/VS/BD command for their Y+ (over Y) for a seat lacking such fundamentals as a proper leg-rest (though the new VS product only offers a footrest).
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Old Oct 22, 2007 | 9:07 am
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Originally Posted by Hartmann
I can think of a few ways they can keep the 757s 3-3 and still have E+. For one, more legroom. They lose a few rows but have 2-3 rows of extra legroom (I'd pay the premium). CO could also have more comfortable seats (leather maybe) and slightly better food.
While I am sure that some would pay a premium for this, my point was just that I don't think a revenue premium for extra legroom and better food would be the slam dunk that it is for the true E+ products. Remember that UA only sees fit to charge $350 per year for unlimited E+ access (and gives it away to elites). An E+ ticket on VS or BA, however, can easily cost $700-$1000 more, and the seats seem to sell.
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Old Oct 22, 2007 | 9:11 am
  #80  
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Originally Posted by cova
Yes - back in the old days - before Internet, I used to anxiously wait for my new Elite OnePass card to arrive by mail each year and the associated enhanced benefits that were announced in the members guide that year. Just like a kid waiting for Christmas morning - each year brought enhancements (and this was before the FT term ENHANCED had any meaning).
The biggest irony for us old-timers is that you used to actually EARN your frequent flyer miles by flying and then could look forward to attainable biz class awards (I'm also daydreaming of triple miles and 1,000 point minimums per flight). Who the heck can accumulate 500,000 miles -- by flying, no less -- for a pair of BF Asian award tickets? If you were flying that much, you'd want to redeem miles to be able to stay home.

Every year, this seems more and more like a credit card game and less a frequent flyer program. Just the musings of an infinite platinum.
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Old Oct 22, 2007 | 9:20 am
  #81  
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Originally Posted by pbarnette
While I am sure that some would pay a premium for this, my point was just that I don't think a revenue premium for extra legroom and better food would be the slam dunk that it is for the true E+ products. Remember that UA only sees fit to charge $350 per year for unlimited E+ access (and gives it away to elites). An E+ ticket on VS or BA, however, can easily cost $700-$1000 more, and the seats seem to sell.
I understand what your point is and I agree. For the domestic side of CO's operation, I doubt E+ would be profitable.

However, after having a conversation with our CEO about the flying options at our company, I can guarantee that the corporation would be willing to pay for E+ on TATL routes and other longhauls. This is a step up for us as employees here usually fly Y everywhere, leaving us tired and useless on the first day in places such as DXB and BOM. BF is too expensive but E+ seems in the range that our company would be willing to pay.

Granted, that's a singular example but I'm sure there are other companies in the same boat. After Larry's speech at the DO, I'm not getting my hopes up.
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Old Oct 22, 2007 | 9:29 am
  #82  
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Originally Posted by rkkwan
Personally, I love to see PE on CO. But I'm not holding my breath. Nor am I convinced it's a revenue bonanza for those who offer it. If it is, you'll see SQ, CX and so on jumping into the fray early on. Both of those airlines compete with BA, VS or BR on a lot of routes, but they decide to stay put. [And even SQ has PE on the 345, they decide not to do it on the A380; and QF is only putting like 2 rows of seats on theirs.] The future international heavyweights like EK, QR, etc also are not introducing them.
The only thing I would offer is whether we are dealing with the same markets? To my mind, E+ is all about segmenting the market to maximize your revenue from each customer. I would think that the TATL market sees a lot of the folks flying in Y that probably can afford to (and will) pay the premium for E+, even if they can't/won't for J, and could support segmentation at the Y, E+, and J levels (I am not certain of the support for true international F). The Middle East, especially, with a much more stratified demographic picture, may find that a segmentation at Y, J, and pull-out-all-the-stops F makes a lot more sense. Just my two cents.
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Old Oct 22, 2007 | 9:42 am
  #83  
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Originally Posted by pbarnette
The only thing I would offer is whether we are dealing with the same markets? To my mind, E+ is all about segmenting the market to maximize your revenue from each customer. I would think that the TATL market sees a lot of the folks flying in Y that probably can afford to (and will) pay the premium for E+, even if they can't/won't for J, and could support segmentation at the Y, E+, and J levels (I am not certain of the support for true international F). The Middle East, especially, with a much more stratified demographic picture, may find that a segmentation at Y, J, and pull-out-all-the-stops F makes a lot more sense. Just my two cents.
I think TATL constitute the majority of traffic for VS; and also a big chunk for BA. So, I agree with you that TATL (in particular to London) will most likely work. But CO has no intention of providing a product on only parts of its network, and it's quite extreme in trying to make its fleet uniform. Plus overtime, TATL is constituting a lower and lower percentage of total CO international traffic.

That's another reason why we'll not see PE on CO in the foreseeable future.

[Another airline that has a very successful PE product is BR. But its main business is also a very uniform one - TPE-US - and it doesn't offer PE for intra-Asia routes.]
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Old Oct 22, 2007 | 9:49 am
  #84  
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Originally Posted by pbarnette
I agree that E+ can be a revenue bonanza, as witnessed by the healthy premium on such fares that I have seen on BA, VS, and SK, as well as rumblings that both BA and VS are looking to expand these cabins. However, their remains the open question about whether CO has the route and fleet mix to make this work. I struggle to see how CO could offer a meaningful upgrade in space on the 757s, without going 2-2. At that point, how do you differentiate BF? And will CO see a huge rush to E+ for what are often 6-7 hour TATL flights? At least to me, the $700 premium for E+ makes a lot more sense for a SFO-LHR leg than for a EWR-DUB leg.

And the above avoids the million-dollar question, which is whether CO's BF is good enough to prevent E+ from poaching BF customers. To offer something that would be competitive with BA or VS, you are looking at close to 40" of legroom and 20" of width. With BA or VS, they can dangle the flat bed carrot, which probably minimizes the impact somewhat, but CO can only offer a better product - not one as completely different as a flat bed.
Introduction of E+ would be concurrent with launch of improved BF and domestic FC.

I agree with Hartmann that you would keep E+ the same seat config (as it is on other airlines that already as E-) but you provide more legroom, a more comfortable leather seat, and all the amemities of BF or FC (AVOD, internet, power ports premium-class meal and beverage service, etc.)

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Old Oct 22, 2007 | 9:52 am
  #85  
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Originally Posted by rkkwan
I think TATL constitute the majority of traffic for VS; and also a big chunk for BA. So, I agree with you that TATL (in particular to London) will most likely work. But CO has no intention of providing a product on only parts of its network, and it's quite extreme in trying to make its fleet uniform. Plus overtime, TATL is constituting a lower and lower percentage of total CO international traffic.

That's another reason why we'll not see PE on CO in the foreseeable future.

[Another airline that has a very successful PE product is BR. But its main business is also a very uniform one - TPE-US - and it doesn't offer PE for intra-Asia routes.]
TPAC Carriers with E+: SQ, TG, NH, BR, NZ, QF (in the future, on the A380), UA (though UA's sucks when compared to the others, which are essentially wholly different products, marketed as such).

There's a market for it on long-hauls, and not just TATL. CO does provide a product on only a portion of its network (i.e., BusinessFirst). There's a market for it, and CO provides it only on its widebodies and 757-200s serving long-haul routes. Likewise, there's ample evidence that there's a long-haul market for a dedicated Y+ cabin.
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Old Oct 22, 2007 | 9:58 am
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Originally Posted by rkkwan
But CO has no intention of providing a product on only parts of its network, and it's quite extreme in trying to make its fleet uniform. ]
RK: I know this is the company line, but the fact is the product is not uniform at all.

1. BF fleet -- This is already a significant sub-fleet, which, like any sub-fleet, makes absolute sense because it meets the demand on the markets it serves

2. Domestic mainline: Domestic FC & 31-32" Y

3. Domestic regionals: All 31" Y only

The fact is there is already as lot of overlap on these three products. It is possible to fly the BF fleet domestically, or to fly the domestic fleet internationally.

By the same token, it is possible to find numerous routes served by both mainline and RJ products. In somes cases, it is even possible to fly the RJ's internationally, albeit, of course, on short-haul routes.

The "one size fits all" mantra simply doesn't work for a carrier with the complexity of routes of CO and that's why the airline already doesn't adhere to it.

Finally, regarding E+, if anything there would be greater demand on CO's ultra long haul routes, such as the Asian routes, for E+, especially given the lack of space on its E-.
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Old Oct 22, 2007 | 10:08 am
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Finally, regarding E+, if anything there would be greater demand on CO's ultra long haul routes, such as the Asian routes, for E+, especially given the lack of space on its E-.
E-... thats priceless!!
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Old Oct 22, 2007 | 10:12 am
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Originally Posted by Anglo Large Clawed Otter
TPAC Carriers with E+: SQ, TG, NH, BR, NZ, QF (in the future, on the A380), UA (though UA's sucks when compared to the others, which are essentially wholly different products, marketed as such).

There's a market for it on long-hauls, and not just TATL. CO does provide a product on only a portion of its network (i.e., BusinessFirst). There's a market for it, and CO provides it only on its widebodies and 757-200s serving long-haul routes. Likewise, there's ample evidence that there's a long-haul market for a dedicated Y+ cabin.
I never disagree there's a market for longhaul PE. I just believe the demand is not uniform across networks, and many airlines only offer them in very specific routes. In my opinion, an airline may see some revenue increase from PE, but cost also increases. Is it worth the trouble? I am with all of you, I think it is; unfortunately, CO doesn't think so.

Anyways, for the Pacific routes, SQ and TG only have them on their ultra-longhaul 345 flights. QF very few seats on the A380. But JL is going to add them, which may make it more common. But if you look at Trans-Pacific seats, there are plenty of large carriers with lots of seats that haven't announced any - CX, CI, KE, OZ, SQ (except for 345) and all the Chinese carriers.
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Old Oct 22, 2007 | 10:12 am
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Originally Posted by otralot
As for other changes, inflation happens (can't say I like it) but stuff does tend to get more expensive over time. That said, the airlines have always had a reverse model to the rest of the market. For some reason, the cost of seats goes up as it becomes more likely they will be come unsold.
Yes, things get more expensive over time - but the cost of airline tickets has gone up and hence the cost to earn those miles has gone up - you are spending more to earn the same miles.

Raising the redemption levels - is a double whammy.

At least CO has not raised the standard reward levels - except the Domestic F - which is in sync with the higher domestic upgrade reward.

For those big ticket EasyPass BF - really only two types of people who earn enough miles to redeem: (1) Top tier Elite flyers and (2) High charge card purchasers. I still think category (2) is the bigger user of BF EasyPass.

The question is - has CO raise the cost of those miles which American Express and others pay for those miles? With inflation - those credit card companies should likely be paying more for those miles.
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Old Oct 22, 2007 | 10:18 am
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Originally Posted by TWA Fan 1
RK: I know this is the company line, but the fact is the product is not uniform at all.

1. BF fleet -- This is already a significant sub-fleet, which, like any sub-fleet, makes absolute sense because it meets the demand on the markets it serves

2. Domestic mainline: Domestic FC & 31-32" Y

3. Domestic regionals: All 31" Y only
Actually, I wasn't talking about product uniformity, but fleet uniformity.

The only subfleet CO has right now are 738 (mid-lav and non mid-lav), and 764 (20/236 and 35/200). Most airlines have more subfleet types.

764s are used not only for international routes, but also Hawaii/Guam. So, they'll also have PE on Hawaii routes.

If you put PE on 752s, that's going to decrease the total number of Y seats further for the EWR-Florida runs in the afternoon; as they can't really sell PE for just a couple of flights each day on these routes.

But my original point is that if they do PE, they'll have to put them on all its 787s, 777s, 767s, and 757s. So, you'll see them on Florida, Europe, Asia, Hawaii. Perhaps PE is extremely lucrative for US-London, but will it be equally lucrative for Bristol, Cologne, Athens, Peking? Maybe, but I don't know.
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