Low Value Customer

Old Jan 13, 19, 1:48 pm
  #16  
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Originally Posted by Wimsta View Post
You are intentionally avoiding the following words:
"We want to get to the point..."

Your source clearly contradicts your assertion.

Your source clearly states that they want to get to the point where miles or cash are the same to them. It is clear that they are not in this position yet.
OK you don't like folks from REV MGT quotes. How about the CEO from back in Q3: https://seekingalpha.com/article/421...pt?part=single

Yes. That's what we're excited about in the future is the ability to control your travel and upgrade however you want to with whatever currency you want to use. So you want to – if your company buys you a coach ticket and you want to sit in the Premium Select cabin, we'll have an offer for you that would be 17,000 miles for you or it’s a $170 in cash. So those kinds of offers are really where we're trying to go with all of that in making it simpler to buy or easier to buy and allowing you to buy it however you'd like to pay for it. - Edward Bastian

That is now live on Delta.com. Yes we know it is not yet "Skypennies" i.e. 1 SkyMiles = 1 Cent but we are almost there now. The point is the company people all feel it makes no difference SkyMiles or Cash!
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Old Jan 13, 19, 1:50 pm
  #17  
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Originally Posted by DougSkymiles View Post

His 2nd sentence here states it clearly, “...would like to get to the point”. I realize you make money this way, but please inform yourself with the various financial statements.
Right, clearly they're not at that point or else they would offer MQD on PWM tickets, and MQM/MQD for regular award tickets.
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Old Jan 13, 19, 1:58 pm
  #18  
 
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Originally Posted by Renes Points View Post
OK you don't like folks from REV MGT quotes. How about the CEO from back in Q3: https://seekingalpha.com/article/421...pt?part=single

Yes. That's what we're excited about in the future is the ability to control your travel and upgrade however you want to with whatever currency you want to use. So you want to – if your company buys you a coach ticket and you want to sit in the Premium Select cabin, we'll have an offer for you that would be 17,000 miles for you or it’s a $170 in cash. So those kinds of offers are really where we're trying to go with all of that in making it simpler to buy or easier to buy and allowing you to buy it however you'd like to pay for it. - Edward Bastian

That is now live on Delta.com. Yes we know it is not yet "Skypennies" i.e. 1 SkyMiles = 1 Cent but we are almost there now. The point is the company people all feel it makes no difference SkyMiles or Cash!
your entire quote by EB was referring to the future, when the value of a Skymiles could be easily changed to 1/100th of a penny if DL wanted to.
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Old Jan 13, 19, 1:59 pm
  #19  
 
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Why are people who have status (especially Diamond,for Pete's sake) identifying as "low-value customers?" DL awards status designations because you've already shown you are NOT a "low-value customer."

Anyone with any kind of status would seem not to qualify for this moniker.
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Old Jan 13, 19, 2:42 pm
  #20  
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Originally Posted by hotturnip View Post
Why are people who have status (especially Diamond,for Pete's sake) identifying as "low-value customers?" DL awards status designations because you've already shown you are NOT a "low-value customer."

Anyone with any kind of status would seem not to qualify for this moniker.
I think they mean "relative to a replacement-level diamond" (VORD if you're into sabermetrics)
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Old Jan 13, 19, 3:01 pm
  #21  
 
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They got rid of the lowest value customers with the MQD implementation.
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Old Jan 13, 19, 3:55 pm
  #22  
 
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I'm also in the confused category. This year, I'm a lowly Silver. I only once scored an upgrade. I'm a nobody in terms of many of the people who have previously posted their status.

I don't think I understand the question here.
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Old Jan 13, 19, 4:20 pm
  #23  
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Originally Posted by hotturnip View Post
Why are people who have status (especially Diamond,for Pete's sake) identifying as "low-value customers?" DL awards status designations because you've already shown you are NOT a "low-value customer."

Anyone with any kind of status would seem not to qualify for this moniker.

Because I am qualifying for status in a way that is less profitable for Delta and i am taking advantage of a lot of benefits. I dont know my actually vcm but it's probably a lot less than other delta fliers. Should change this year based on work, but last year I bought loads of trash fares and got upgraded all the time. Good stuff for me, bad for Delta.
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Old Jan 13, 19, 4:26 pm
  #24  
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Originally Posted by Psyduck1 View Post
Because I am qualifying for status in a way that is less profitable for Delta and i am taking advantage of a lot of benefits. I dont know my actually vcm but it's probably a lot less than other delta fliers. Should change this year based on work, but last year I bought loads of trash fares and got upgraded all the time. Good stuff for me, bad for Delta.
You got upgraded because Delta didn't have anybody else of same status and higher fare class to whom it could give those upgrades. If you cleared a RUC or a GUC it's 'cause DL couldn't sell the seat. SDC (on a coach ticket) meant you found inventory in the same cheap fare class instead of higher fare buckets as travel date approached. DL is satisfied with your MQM and MQD (dual factor qualification) or waiver combo. If it was unhappy and people like you represented a significant fraction of travelers DL would change qualifying rules again - I don't doubt that for a minute.
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Old Jan 13, 19, 4:27 pm
  #25  
 
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I figure delta considers me a burden.

I live outside the US don't have to worry about MQD and I am upgraded on my flights 98% of the time. Since gaining status I stopped buying 1st outright because I know my upgrade chances are 98%.
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Old Jan 13, 19, 4:44 pm
  #26  
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Originally Posted by 3Cforme View Post
You got upgraded because Delta didn't have anybody else of same status and higher fare class to whom it could give those upgrades. If you cleared a RUC or a GUC it's 'cause DL couldn't sell the seat. SDC (on a coach ticket) meant you found inventory in the same cheap fare class instead of higher fare buckets as travel date approached. DL is satisfied with your MQM and MQD (dual factor qualification) or waiver combo. If it was unhappy and people like you represented a significant fraction of travelers DL would change qualifying rules again - I don't doubt that for a minute.
A couple of things to unpack here. Yes there was no one else if I was upgraded, but I consume more and am more expensive in first class than in coach. Airline margins are really different/hard to analyze but when I get upgraded I'm not hurting hard product costs but I am hurting soft product costs(depending on how I behave).

The point of an upgrade is that a customer is so valuable in total that comping them the variable cost of an upgrade is still profitable and it drives future revenue from the customer.

The important thing you mentioned is that I dont represent a significant portion of customers. If mix slanted in my direction I think delta would be doing something about it.
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Old Jan 13, 19, 5:27 pm
  #27  
 
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Originally Posted by Psyduck1 View Post
A couple of things to unpack here. Yes there was no one else if I was upgraded, but I consume more and am more expensive in first class than in coach. Airline margins are really different/hard to analyze but when I get upgraded I'm not hurting hard product costs but I am hurting soft product costs(depending on how I behave).
Many times, your getting an upgrade creates a seat DL can sell to a walkup Y in a higher fare bucket, who would not pay for F directly (not allowed to book in F due to company policy is one reason). Because if they paid for F, you would not have received the upgrade into that seat.

Your rank within the Platinums really doesn't matter. What do they call the person who graduates 96th out of 100 in his medical school class? "Doctor". You are also "comfortably above the average Gold" or "way above the average Silver". You do show brand loyalty compared to those other classes. Delta also realizes that many people who qualify as you might for PM, also could have significant status with another airline as well and need to compete for your business. The next slippery slope would be lower qualification thresholds for people living outside a DL hub city, like they do now with the MQD waiver for people living outside the US. Doubt that will happen. They already charge the hub captives higher fares so this would be a double hit. I see them raising the card spend for PM or MQD for PM if they really want to reduce the number of PM's.
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Old Jan 13, 19, 6:09 pm
  #28  
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For those resident in Europe, it is also worth noting that DL benefits from the ST alliance by competing in markets where it otherwise could not. Thus, living in Europe does not make you a LVC, it is simply a different calculus.

FT is full of people who think of profitability on a segment-by-segment basis. But, the world does not operate that way.
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Old Jan 13, 19, 6:23 pm
  #29  
 
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A low value customer is someone who flies once a year on a Basic Economy ticket yet gets lounge access by being someone’s guest and gets compensated due to a delay.

anyone with elite status has some kind of value.
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Old Jan 13, 19, 7:14 pm
  #30  
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Originally Posted by Renes Points View Post
OK you don't like folks from REV MGT quotes. How about the CEO from back in Q3: https://seekingalpha.com/article/421...pt?part=single

Yes. That's what we're excited about in the future is the ability to control your travel and upgrade however you want to with whatever currency you want to use. So you want to – if your company buys you a coach ticket and you want to sit in the Premium Select cabin, we'll have an offer for you that would be 17,000 miles for you or it’s a $170 in cash. So those kinds of offers are really where we're trying to go with all of that in making it simpler to buy or easier to buy and allowing you to buy it however you'd like to pay for it. - Edward Bastian

That is now live on Delta.com. Yes we know it is not yet "Skypennies" i.e. 1 SkyMiles = 1 Cent but we are almost there now. The point is the company people all feel it makes no difference SkyMiles or Cash!


Originally Posted by DougSkymiles View Post

your entire quote by EB was referring to the future, when the value of a Skymiles could be easily changed to 1/100th of a penny if DL wanted to.
I know it is hard to keep up with all the Delta devaluations and KeepDescending changes but here is the link as the future is NOW (well 7DEC18): https://news.delta.com/how-delta-mak...ing-your-miles
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