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Originally Posted by sbagdon
(Post 18761923)
What I can't find called out is what happens if your flight is changed based on irregular operations (such as wx/mx/etc).
Yet to have to drill down two extra pop-ups, and read through a couple of thousand words, would explain why not many people are, and why this mx/wx/ir-ops downgrading discussion keeps repeating. A simple statement of "I clicked on the F column and now I'm sitting in Y with no compensation" deserves a simple rebuttal or explanation. |
Originally Posted by StayingHomeIsBetter
(Post 18762410)
Sounds like you are in a market that DL has not figured out how to FCM yet.
Prepare for further capacity cuts. Regardless. My experience today went something like his. I checkin at T-24 or so and am 2 of 3. A few hours later it goes to #4 of 10. Not a problem except tha there are 19 open seats. This morning I'm #10 of 23 or so with the same 19 open. I get to the Skyclub about an 45 minutes before boarding and I'm handed my upgraded seat. Delta.dum says there are still 13 open upfront. On my connect I'm 2 of 11 with 11 open. Been that way since T-24. Go figure. There isn't a lot that Delta is getting out of holding back V inventory other than a few grumbling diamonds, a few frazzled GAs and a CF at the gate as upgrades are cleared (or not for GMs and FOs who see a wide open seat map and think that they actually have a chance). I can appreciate F5 and holding but not F9 with 19 at T-24. |
Originally Posted by Bicostal
(Post 18770470)
On my connect I'm 2 of 11 with 11 open. Been that way since T-24.
I can appreciate F5 and holding but not F9 with 19 at T-24. |
Originally Posted by Bicostal
(Post 18770470)
There isn't a lot that Delta is getting out of holding back V inventory other than a few grumbling diamonds, a few frazzled GAs and a CF at the gate as upgrades are cleared (or not for GMs and FOs who see a wide open seat map and think that they actually have a chance).
I can appreciate F5 and holding but not F9 with 19 at T-24. That is not as bad as DL FCM, but the process is similar. |
Originally Posted by Bicostal
(Post 18770470)
There isn't a lot that Delta is getting out of holding back V inventory other than a few grumbling diamonds, a few frazzled GAs and a CF at the gate as upgrades are cleared (or not for GMs and FOs who see a wide open seat map and think that they actually have a chance).
Look at it this way... DL has 5766 daily departures (http://news.delta.com/index.php?s=18&cat=47). If just one in three of those departures results in a single -UP purchase, at an average cash-flow increase of $500/per, that's almost $1mil/day. I'll never argue that what they are trying to do is a a bad thing... cash-positive FCM. Though I'll be right there with eveyrone on how they are implementing this. The only leeway I'll give them is that I suspect their back-end systems weren't designed from the start with FCM in mind, and it's going to take a while for everyone to wrap their mind around FCM, and upgrade processing. And yes, people are now noticing that there's net positive cash-flow, yet right now it appears this is overwhelming the GAs with BF UGs. The object is to maximize cash-flow while minimizing human interaction. It's going to take a while for DL (and everyone?) to get this right (years?), yet one by one, the business and system solutions will arrive, to accomplish these strategic goals (imo). |
Originally Posted by sbagdon
(Post 18775391)
Look at it this way... DL has 5766 daily departures (http://news.delta.com/index.php?s=18&cat=47). If just one in three of those departures results in a single -UP purchase, at an average cash-flow increase of $500/per, that's almost $1mil/day. |
Originally Posted by sbagdon
(Post 18775391)
Look at it this way... DL has 5766 daily departures (http://news.delta.com/index.php?s=18&cat=47). If just one in three of those departures results in a single -UP purchase, at an average cash-flow increase of $500/per, that's almost $1mil/day.
How many potential F fares are sold as -UP fares instead, at an average cost to DL of $2000? That says the immediate cash-flow effect is much worse than you state, and might be negative. (For that matter, I've seen -UP fares $500 lower than Y fares, immediately costing DL $500, potential for a cash-flow-positive F sale, and goodwill.) |
I'm making just about as many assumptions as anyone else, when it comes to the details of the process. I'm just throwing numbers out there, and they are almost certainly off.
Yet, the point is... this is positive cash-flow, or it's not. If it is, DL will make the back-end processes work. If it's not, DL will decide when to pull the plug on it, and give up on -UPs. If DL smells money it stays, if not it's gone. The pax are looking at this from historical pricing, and DL that's looking at this at point-in-time. The pax say... I paid X, and now it's Y! DL is saying... I have an empty seat, how can I get the maximum strategic value from selling it right now? I suspect that at T-3, DL has a general idea of how the flight is going to go, and is looking at an empty F cabin, and saying... where's the oppurtunity from this crisis? Nobody is buying Y0 (with instant-up) or F0, so let's toss a P/A (from an H-UP or Q-UP) that's just a bit more then M, and see if we get any takers. With an empty F cabin, I imagine that all DL is asking is... how and when do we extract that last $100-$500, from an -UP? At time of purchase? At check-in? At gate-control? Even in-cabin? Why are we giving away these seats, when we can achieve positive cash-flow from them? And upgrades isn't part of their strategic objective, except when it impacts operations (such as overwhelmed GAs from BF UGs). I'm not saying that this is right or wrong, and I'll certainly argue that this is a pandoras box that even DL doesn't know what resides within. Noone knows how to operationalize this, so I suspect that everyone is making this up as they go along. Yet I also believe it's here to stay. |
Originally Posted by sbagdon
(Post 18775595)
I'm making just about as many assumptions as anyone else, when it comes to the details of the process. I'm just throwing numbers out there, and they are almost certainly off.
Yet, the point is... this is positive cash-flow, or it's not. If it is, DL will make the back-end processes work. If it's not, DL will decide when to pull the plug on it, and give up on -UPs. If DL smells money it stays, if not it's gone. The pax are looking at this from historical pricing, and DL that's looking at this at point-in-time. The pax say... I paid X, and now it's Y! DL is saying... I have an empty seat, how can I get the maximum strategic value from selling it right now? I suspect that at T-3, DL has a general idea of how the flight is going to go, and is looking at an empty F cabin, and saying... where's the oppurtunity from this crisis? Nobody is buying Y0 (with instant-up) or F0, so let's toss a P/A (from an H-UP or Q-UP) that's just a bit more then M, and see if we get any takers. With an empty F cabin, I imagine that all DL is asking is... how and when do we extract that last $100-$500, from an -UP? At time of purchase? At check-in? At gate-control? Even in-cabin? Why are we giving away these seats, when we can achieve positive cash-flow from them? And upgrades isn't part of their strategic objective, except when it impacts operations (such as overwhelmed GAs from BF UGs). I'm not saying that this is right or wrong, and I'll certainly argue that this is a pandoras box that even DL doesn't know what resides within. Noone knows how to operationalize this, so I suspect that everyone is making this up as they go along. Yet I also believe it's here to stay. What I do know and others I am sure know as well is that spreadsheet jockeys can make something like this look like a windfall of profits.... even if it negatively affects the actual bottom line. I am not saying it does or will... just saying... Also, a significant false assumption is that "Delta knows what they are doing"... Delta and many other big and small companies have suffered from poor decisions made by the overly ambitious and the underly cautious alike... We also do know that Delta is doing this experiment at the expense of many of its Frequent Flyers. Not all maybe... but many... whilst at the same time running advertising pushes telling Frequent Flyers that more FC seats await their loyalty.... that and the fact that it came along and Delta has pretended it is not affecting many FFers is dissapointing... Having my delta flying experience measured in decades and not years, I can tell you that I have seen these types of deals and the people who came up with them come and go. Not saying it will not stick, but history tells us that a lot of these things do not... nor do the ones that came up with them... |
Originally Posted by Thomas Hudson
(Post 18775770)
I think wise people with business sense realize that there is give and take with this type deal as there are with most pricing decisions made when selling a product. It certainly is complex and is silly to attempt to simplify it on this thread. I am not accusing you of this fwiw.... I think you agree with me for the most part.
What I do know and others I am sure know as well is that spreadsheet jockeys can make something like this look like a windfall of profits.... even if it negatively affects the actual bottom line. I am not saying it does or will... just saying... Also, a significant false assumption is that "Delta knows what they are doing"... Delta and many other big and small companies have suffered from poor decisions made by the overly ambitious and the underly cautious alike... We also do know that Delta is doing this experiment at the expense of many of its Frequent Flyers. Not all maybe... but many... whilst at the same time running advertising pushes telling Frequent Flyers that more FC seats await their loyalty.... that and the fact that it came along and Delta has pretended it is not affecting many FFers is dissapointing... Having my delta flying experience measured in decades and not years, I can tell you that I have seen these types of deals and the people who came up with them come and go. Not saying it will not stick, but history tells us that a lot of these things do not... nor do the ones that came up with them... Personally, I think the pax and DL are both thinking in the short-term. The Elites are up with pitchforks and torches, saying... where's my upgrade?! DL has their spreadsheets out, saying... look, RASM is up, so this must be a good thing. Is anyone looking out to next year? Or the year after? Balance will come, sooner or later, yet I'm expecting disruption along the way. Yet let's face it... with consolidation, we're now entering the next paradigm, the shift is happening right before our eyes. The most loyal-of-loyal customers are the only ones that are going to get hard- and soft-product increased benefits (with DL defining the concept of "loyalty"), the rest are going to get the mini-benefits (free checked bags, etc). And sticking with the thread title of FCM, soon (imo) the only way you're going to get into F is as a DM/Reserve, or if you buy/redeem your way in. DL will squeeze every last dollar from FCM, until they think that loyalty desertion is having a negative strategic impact on RASM (they do run this show, after all). So... enough strategy. Can we get back to the operationalization of FCM, and why someone didn't yet get their upgrade for tomorrow? |
Originally Posted by sbagdon
(Post 18775595)
Yet, the point is... this is positive cash-flow, or it's not. If it is, DL will make the back-end processes work. If it's not, DL will decide when to pull the plug on it, and give up on -UPs. If DL smells money it stays, if not it's gone.
As an economist, I can't fault RM for trying to tailor pricing. With a perishable good, it is an age-old art of trying to avoid selling to anyone at a price that the customer would have been willing to pay more, but while still finding enough customers to sell all of your perishable good. I'm sure RM could manage this perfectly if they had a person dedicated to each flight, but that's clearly impossible, so they are trying to tweak automated rules to maximize the profitability of each flight with minimal human intervention. What RM is not (and likely cannot) factor in is the value of customer loyalty, and customer perception. Airline programs have some of the most "sticky" customers of any industry, which is a MAJOR disadvantage when it comes to trial and error. Loyal airline customers will endure much more than most companies could ever hope for, but when they reach a breaking point, it requires major effort (status match, change of flying patterns, new bank of miles, etc) that is not likely to be recanted if the airline realizes the error of their ways. I disagree that it's here to stay, but I think the real fallout (not FT whining, but mass-exodus) will come much later than anyone expects, and will be much more serious than a siloed organization like Delta could ever anticipate. Perhaps I'm wrong, but in a few years I expect DL will be in a much different financial position, and the board will have to make wholesale leadership changes in an effort to right the sinking ship. |
Just to add my story, domestic upgrades was the main reason for me to stay with Delta despite relocating to a UA hub (Denver) and the well known Delta international upgrade weakness/lack of directs.
However, now that 50%+ of my Sun/Thu flights (before onset of FCM 90%+ upgraded at 6day window) are going to the battlefield and with four misses in the last two months (two misses on the formerly easy to ugprade DEN-DTW flight), I am seriously considering matching over to UA 1K. Like many people here, even if FC is only $49-69 more each way than last minute high coach fares, my corporate policy requires booking only coach fares through the corporate travel agency for domestic travel. If my domestic upgrades are going to be a crapshoot, might as well as take advantage of more convenient UA schedule, 8 useable SWUs (I average 150k/yr), and having a good shot of my companion sitting upfront with me. If upgrades have gotten this bad for me, I can see why the GM/PM are screaming bloody murder. |
Originally Posted by dchen2
(Post 18776139)
Like many people here, even if FC is only $49-69 more each way than last minute high coach fares, my corporate policy requires booking only coach fares through the corporate travel agency for domestic travel. If my domestic upgrades are going to be a crapshoot, might as well as take advantage of more convenient UA schedule, 8 useable SWUs (I average 150k/yr), and having a good shot of my companion sitting upfront with me.
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Originally Posted by sbagdon
(Post 18776213)
The irony is, P/A should book from the H or Q buckets (ok, really H-UP or Q-UP). So isn't that technically an economy purchase?
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I know I've started buying -UP fares on personal trips that are very long. For example, Sep. 3 LAS-JFK (one-way) the -UP was about $120. For a ~4hr flight that was worth it.
I've been doing some experimentation and over the weekend looking at today's flight (as if I was to buy it) and many of the LAS-JFK flights had wide-open F cabins (I know, seatmaps are not 100% accurate, but..) but "Upgrade Eligible" B/M fares (!) and lots of -UP. Only one or two actually had "Upgrade Available" |
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