Most airlines give significantly more mileage for higher fares. A predominantly discount ticket flyer earning high elite status is likely flying considerably more trips to get there. And what about people who control travel for other family members. I buy tickets for my wife and kids, all of whom frequently join me on trips. While they might not earn higher tier elite levels, by getting my business, the airline also gets, by extension, this additional business, which goes with my patronage. In reality, most carriers are pretty generous with basic elite status. Case in point, the famous TWA, with its revenue based program, just sent me an Aviators Elite card based on my enrollment in a Thrifty car rental database, and I haven't rented from Thrifty in quite a while. So much for spending my money on TWA to obtain that status the regular way.

Loyalty. These are loyalty programs. The airlines want you to call them whenever you fly. No matter what fare you pay. If your customer is loyal, you'll get them when they fly on a cheap ticket, but also when they fly on an expensive one. Base it on revenue and an airline will find itself with empty seat and reduced revenue. Airlines are aware of this but are trying to be a bit more fair to Full Fare revenue passenges by offering bonuses. But the airlines have to fill those seats and can't survive on just high revenue passengers.

I would hate it! I reached Premier Executive this year on ~$3,000 of tickets, and may well hit 1K based on ~$5,000 (several overseas using cheap-o or e-fares). If United based elite status on ticket revenue, this might barely qualify for Premier!

That said, I understand (and would grudgingly support) the airlines' rationale if they went in this direction. American already does, counting discount fares at 50% for elite status.

In fact, why not go all the way and base frequent flyer awards on the revenue, instead of the miles? But if it ain't broke, don't fix it!

One important thing to remember about TWA's program is you can still earn elite status either way, which I don't think is such a bad thing!

From an antitrust and competitive standpoint, diversity and competition is what it is all about!! Let them fight it out to see which type of reward system the FF market likes better. Let them build the better mousetrap. More power to 'em.

Unfortunately, this supposes that the market would be judging based upon "all other things being equal." Of course, as we know, TWA is not equal to other airlines--doesn't have as big or as good a route and hub structure and doesn't have the financial resources. But this is clearly an attempt to see if it can lure enough business fare customers to build up its financial position as well by luring the high profit clientele.

However, if TWA is going to build up its attractiveness to business flyers, it really ought to give you first class seats in those MD-80s and first class meals.

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That's my two cents worth.

Djlawman

I had a feeling that post would elicit some howls!

Punki: The full fare traveller falls into the category of the salesperson who makes the million dollar sale every month. (S)he is consistently generating more revenue for the airlines.

Rudi: The model for airline programs is different, because the cost of sale is no different for the full fare traveller than the lower fare traveller. And the risk of a full fare traveller switching programs is no higher than a lower fare traveller.

PremEx: Loyalty in terms of number of flights or amount of money spent? It's all how you look at it.

pgupta011 and johna: From my point of view, the current model is broke. I have to buy full fare tickets regularly, yet I am treated the same as someone who spends much less with the airlines but logs more miles. TWA is the only program that's got it right.

Beckles: Good points!

dgolds - I don't know which airline you fly, but United offers bonuses for first/business class seats, and many promotions for full fare tickets, and some priority on upgrades for full fare tickets. Plus if you are charging to your credit card you can get more miles on your credit card charges. So your contention that you are treated the same is not true. But then if the TWA model works for you, use it.

[This message has been edited by pgupta011 (edited 07-11-1999).]

Then what's the issue? The frequent full-fare traveller who actually does fall into the category of the salesperson who is making the $1,000,000 sale every month, is already at the top and is getting all the benefits.

The occasional full-fare traveller, on the other hand, simply isn't as valuable a customer as the traveller who is on the planes several times a week. (You know, even frequent travellers who make every effort to get the best fare possible occasionaly buy full-fare tickets. When they do, they are certainly going to purchase from the airline where they have the most status, get the best upgrades and most points.)

But if you feel that strongly, like pgupta110 says, you can always fly TWA. And like DJlawman says if it works, more power to TWA and congratulations to you for your perceptiveness.

I, like Punki, fly lots of short segs each year, many of them on "rivet rattlers" and commuter jets with NO First Class. I made Platinum in 1998 on CO with over 90 segments, of which I paid a grand total of just over $11,000. A number, which I am sure CO is NOT impressed with (but my employer is). However, like the "Premier Executive" said, "It's loyalty." Most of the time when I fly on an aircraft with FC seating, I get an upgrade, which I personally think is a reward for being loyal. And, I do plan ahead enough to probably pay much less than the person sitting next to me, but "I" believe my loyalty entitles me to do this. In 1999, I have flown some 66 segs toward the new "90" segment Platinum qualification on CO. And, NO, I do not "pad" the segment count with unneeded segments, I really do not have time for that, nor the intestinal fortitude to treat my employer that way. Sure, there is room for both "loyalty" and "revenue", but what is not visible in Punki's example of the 20 $10,000 sales vs. the single $1 million sale is that the $1 million sale probably required more than 20 segments to achieve because of the intricacies involved. Whereas, the 20 $10,000 sales did not require as much expense. I do not know what kind of business all y'all (except the beverage man) are in, but I can assure everyone that more money is spent achieving the $1 million sale than 20, $10,000 sales. Now, how much loyalty is there in 20, $10,000 sales? A WHOLE BUNCH!!!

I've been managing sales forces for 15 years; give me people that consistently produce the 20-$10K orders anyday over the Million Dollar sale. As Punki said, if Mr/Ms Million $$ can do it consistently, that's another story. But the analogy is not germain to this issue.

Maybe I'm a little naive, but it seems to me that all the airlines are presently trying to appeal to all the people, all the time, as best they know how to! The "niche marketing" they employ is reflected in different ways, by differeent airlines, with differing degrees of success. Meanwhile many leisure travelers will NEVER buy a ticket unless they think it is heavily discounted!

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The hotel programs already offer points per dollar, why not airlines?

Is it fair for someone to pay $300 from NY to LA and someone else pay $500 for NY to Chicago and get so many fewer miles? Distance of travel has little to do with loyalty.

Personally, I like Southwest's model of segments flown.

Good points, especially agree with PremEx, doc and arturo.

I don't want to beat a dead horse, but I just don't agree that a passenger who spends more with an airline is less valuable than a passenger who spends less.

I am not arguing that loyalty to an airline is a bad thing and should not be rewarded. (I am very loyal to my airlines of choice!) I just think the reward should be based on money spent as opposed to number of segments or distance of flights. Like Hawkeye said, the hotel programs do it and no one complains about that. How come?

My way of thinking is definitely affected by the fact that I buy a lot of full fare tickets

Hawkeye: Good point.

Punki: Real world example: suppose someone travelled once every other month full fare SFO-EWR on UA for approximately 30,000 miles/year. The cost is approximately $12,000. At the end of the year, the traveller gets Premier on United, which means that it is possible (but difficult) to upgrade.

Compare this to the traveller who flies monthly SFO-EWR on $500 discount tickets. They spend $6000 and earn 60,000 miles. At the end of the year, they make Premier Executive, which makes it easier to upgrade.

Both travellers are equally loyal to UA, but the one who has spent less money and cost UA more (because of taking up twice as many seats on their planes) is rewarded more. I can't see rewarding traveller #2 with the higher status.

pgupta011: What benefits is UA currently offering on full fare tickets? Last I looked, they were inferior in this regard to many other airlines, including CO, HP, US, TWA.