bennos

Thanks for the link, this is super interesting. Note slide 17 says the average tenure of Medallion members is 16 years. The 1.5x revenue premium might help with the endless discussions here about whether Medallion members are really HVC (vs those who just buy premium outright, or those who have no status and pay more fees), and whether DL will continue to seek to retain them. The answer to both questions is a resounding yes.

Another interesting tidbit is on page 18, where there has been a ~45% increase in Medallion Net Promoter Score from 2016 through 2019. Net Promoter Score (basically "would you recommend this business to a friend?") is one of the few metrics that seems to correlate with financial performance, so this is meaningful. It also answers the question as to whether Medallions were put off by all the negative changes to the program over the last several years (not counting the exception of 2020), and the answer to that is clearly no.

Here's one more: 79% of SkyMiles members have an annual income of >$50k. These are people who (in the aggregate, and at least occasionally) can spend on "premium" features.

In summary, I think this document points out that DL has been pretty successful at executing its strategy of designating itself a premium program over the past several years, and cutting the unsustainable (some would say generous) aspects of the program. It'll be interesting to see what happens next...

Slide 12 says 3% on non-air travel, with 97% shared between DL and partners.

NCLSEA123

Unless you’re a cargo airline of course. Atlas Air, Air Transport International (ATI), Kalitta, UPS, and FedEx just you name a few in the U.S. Atlas and ATI also have smaller passenger charter operations.

EAJuggalo

Depending on where you live, 50k is almost poverty level. I think I saw average rent for a one bedroom apartment in SF or Manhattan is 2500/month. That would be 30k just in rent.

FlyerWx

Maybe it's my inner Statistics major talking, but it would be interesting to see this breakdown by Medallion level. With income adjusted for cost of living per city.

Also, does anyone know if Delta has an annual income number on all of us? Do they count young children as having 0 income, or are they excluded? It wouldn't surprise me if they can infer our income, at least categorically.

I think this has been alluded to in other threads, but attracting premium pax to the FF program is different than actually getting them to fly. Putting capacity and the right prices on destinations where people want will be a tricky endeavor during this COVID-19 situation.

woodenshoe101

A few years ago when DL launched a new website design, there was a way to see a bunch of flags about yourself set on the DL website, including an estimated home value and income, and a customer value score. These flags have since been hidden, but they for sure still exist internally at DL. There was a whole thread about it: Delta and new DL.com Profiles A Lot About You

bennos

No landlord will rent a $2500/mo apartment (which is actually low for a good 1BR in Manhattan) to someone making $50k/yr. They'll either commute in or split an apartment with one or more roommates (and therefore pay more like $1k/month), or daddy will pay for it. On top of that, only 8% of SM members come from NYC (which of course includes more than Manhattan), and SFO doesn't even get broken out in the stats (probably because it's not a hub).

Further complicating things, the DL analysis appears to be based on income per person (though I can't find it explicitly stated), whereas US median income tends to be reported on a household basis. The US numbers are also skewed by increased income disparity. Regardless of how you look at it, though, SM members skew wealthy (45% have income of $100k+) which puts DL in a good position to sell premium (once the market returns).

Looking again at the numbers, there's yet another interesting stat... Combined, JFK and LAX represent 13% (1 in 8) of SM members. The "traditional" hubs of ATL, DTW, MSP, and SLC combined represent 15%. (BOS and SEA are another 4%.) Notwithstanding the increased competition at JFK and LAX, it seems pretty obvious that DL will continue to prioritize developing those (larger population) markets.

Zorak

I'd be curious to know how these figures compare to the same metric for AMEX's other co-brand partner families.

jiburi

Skymiles IP Ltd, based in Cayman Island? Really?!.

Jiburi

acrophobia

In Manhattan, the average for a 1BR is more like $3200, and that is heavily weighed down by rent stabilized apartments that are not/will not be available to anyone seeking housing today, as well as by apartments that do turn over but in neighborhoods where almost no one would choose to live. The average rent for a 1BR that you can actually get in a neighborhood you would actually want to live in would shock you.

HDQDD

OT, but I think pre-covid rent is actually higher than that in SF/NYC. Keyword there is "pre-covid". With the mass exodus of people out of cities (at least temporarily) that's going to change. In addition, there are all the stayed evictions that are pending.

On the other side of the coin, home builder confidence is at an all time high. They can't build houses in the 'burbs fast enough. We have this huge pending wave of evictions, but were still building all gangbusters... Seems like I've seen this movie before...

sfozrhfco

Title needs to be changed to $9 billion. DL is really piling on the debt...

https://www.cnbc.com/2020/09/17/delt...9-billion.html

Smithwicks70

Saw that as well this morning on Reuters. Article right next to it was airline execs pleading with Congress for more money, but looks like Delta was absent from the article. Only seemed to mention AA and Southwest.

ClipperDelta

Apparently they upsized the deal due to strong demand...the 5 year bond offering was originally $2B at 5% and is now at $2.5B and 4.5%, while the 8 year bond offer went from $2B and 5.375% to $3.5B at 4.75%. The term loan facility was increased from $2.5B to $3B.

According to this article, as of yesterday, investors had placed orders for $16B for the two bonds and $10B for the term loan facility; this led to Delta’s decision to increase the size of the offering. Some of the funds will be used to repay existing loans.

https://finance.yahoo.com/news/delta...133717688.html

fly747first

Oh trust me, DL will ask the government for more help too

cmd320

Haha, indeed. Ed was standing right there between Tweedledee and Tweedledum (Kirby and Parker) asking for a bailout.