A solution to building loyalty via Upgrades/Awards
 

Given that most airlines appear to be finding it difficult to reconcile the premium prices and costs for business class seats with mileage upgrades and rewards with most chosing either to not provide much upgrade/award seats or to reduce the quality of the business class, I believe the only solution is to have a separate upgrade/award class for FFs.

All I want on long international flights is a decent reclining chair with a foot rest and sufficient leg space and some reasonable food without the expensibe wine, chocolates, designer coffee, etc., etc. An FA coming around once every hour with water and I am happy. I don't even care if the entertainment is the same as Y class.

Designate these seats for upgrades only to reward loyal customers based on elite status. This way the business class can be kept as a premium product and priced accordingly. The FFs get their status acknowledged and get the most painful aspects of flying Y addressed. The first major airline with this feature will get all my business.

Of course, many will feel that this is a reduction of benefits for the FFs but between the choice of not getting an upgrade at all and flying Y and getting an upgrade to this upgrade class, I would very much like the latter.

Any thoughts?

i agree, but it's tough to partition coach class that way. and, how to you handle things such as wheel chair passengers? they typically sit up front in coach.

it's a good thought, now you just have to get it implemented. it's like United's better coach thing-ie, right?

and, if you are going to do this, it's basically three classes of service, first, coach "plus," and coach. that's kinda like first, business, and coach. or, do you mean have four classes: first, business, coach "plus," and coach?

[This message has been edited by fly co to see the yanks (edited 03-03-2002).]

For transpacific service, you need to check out EVA Airways' Evergreen Deluxe Class.

Nail right on the head.

Yup, its a reduction in benefits. And the requirements for a lot of frequent flyers in FT does not fit this separate class.

And since demand for a certain premium class may fluctuate day to day, what do you propose for seats that do not sell in the premium class?

BTW - FFs already get preference towards bulkhead seats. It seems like your requirements are for a bulkhead seat.

[This message has been edited by PG (edited 03-03-2002).]

I don't think there'd be that much of a cost savings. You're basically asking for everything you get in business class, but with a coach meal.

And what do we do about people like me who want to upgrade and get the full experience?

And what airlines are allowing business or first cabins to go empty when there are people wanting to upgrade? Sure you might not get your upgrade until just before departure, but I've never been turned down when I show up with an upgrade cert. and there are seats available.

Furthermore, if the airlines were to implement this new award category, how would it work?

Would they use the existing business class cabin and just segregate who gets what services? In this case, you're still running into the same problem of the airlines wanting to hold seats for revenue. That's not going to change, the only difference is that you want to pay less miles for the same number of seats.

Or, would they take out coach seats and put in new seats that meet your specs? In this case, the airlines would have to take out maybe 2-4 coach seats for each one of your seats they put in. Then they'd have to find a way of making that one seat of yours bring in as much revenue per flight as 2-4 coach seats would have. Since these seats would be for upgrades, all they'd be doing is bringing in extra miles - not any additional cash revenue.

d

I think China Southern Airlines does something like this.

Upgrade pax from Economy class to Business Class will be served an Economy Class meal.

Paid Business Class pax will be served a Business Class meal.

That may very well be the case but I don't see airlines being able to support $6000 seats occupied by people that have paid $500 and with miles that may have been earned for less than the difference either from a cost perspective or from a (class) branding perspective. It is good that we have this capability at the moment but I don't see this being sustainable.

Do what CO is already doing in International flight, get more miles and money to upgrade or decide that a partially empty premium class is needed for the ambience of the class branding that will keep people paying big bucks.

Not quite. Amazing what just a foot rest can do to comfort over long distances. I am willing to pay miles to get that upgrade and be loyal to an airline that does this.

In the current state, CO has completely lost me as a customer because of their policies. I see UA and AA struggling to keep the level of service up in these premium classes to justify the prices for those that pay them and eventually are going to lose them to airlines that maintain that premium like CO. What I suggested seems like a good compromize to keep both loyal fliers and premium price payers (often not the same group) happy and be with the same airline.

It would be interesting to get some figures from someone who knows about the cost of space vs. amenities for an airline.

Higher fare criterion + additional money. There will be some people who won't be able to get their cake and eat it too.

Have you flown Continental International...lately?

Most airlines do not provide upgrades or certificates as easily for International flights as for domestic flights.

The airlines can shoot themselves in the foot if they want like CO is doing but the idea is that an airline that wanted to implement this in a section of its aircraft would get rid of all the silly restrictions that they place now to give the idea that you can upgrade but really cannot. When you book, if there are seats in this section (available from the start) and you have the miles you can get it on the spot with non-refundable miles.[/B][/QUOTE]

This is the only alternative if they wanted to reconcile both high fare passengers and low fare volume passengers. Right now it is done with smoke and mirrors where the low fare passengers are thrown dog biscuits once in a while to keep hoping and flying and the high fare flyers are duped into paying a ridiculous amount for a seat that some can get for a tenth of that price. It makes neither camp happy as you can see from many of the threads in the specific airline boards.

Well, since everyone is so unhappy with CO's upgrade policies, why don't you start flying AA where you can upgrade just about everything?

AA doesn't let planes fly with empty first and business seats if there are people who want to upgrade with miles.

d

Delta.

I guess that the conclusion is that only Continental's model will work, other airlines models are unworkable. So frequent flyers be prepared to pay premium bucks or shell out tons of miles for the upgrade - and the alternative is a quarter upgrade using the current number of miles.

Alternatively, CO model will work for attracting premium fare payers who are looking for value (CO BF is certainly better than UA/AA and they don't need to share the premium cabin with the riff raff from coach!) and UA/AA model will work for low-fare FFs who have better upgrade chances but the quality of the cabin will continue to decline until it is at par with what the yield from that cabin really is from paid customers.

I haven't been in AA's biz class and it has been a long time since I was in CO's biz class (business first), but UA seems to provide a nice business class, no worse than CO's (it seemed to me).

I don't buy this argument. Plenty of airlines have lower yields based on market dynamics (Asia is generally cheaper than Europe, for example), but still manage to provide good service. Furthermore, I'm not convinced:

-that CO, with empty seats and employees up front, gets better yields than UA or AA (this point could be verified, but I lack references)
-that CO's business class is better than UA's or AA's; frankly, I always try to fly 3-class airlines in order to have the opportunity to upgrade to F

Clearly, UA c-class has declined over the past year or so, but I doubt there is a strong correlation between this decline and the upgrade culture because the current upgrade system predates the notorious service cuts that are often spoken of here.

Their costs are much lower than US/Europe based airlines (ask their pilots how much they make) so the comparison is moot.

Overall, CO is doing better financially than UA or AA. I have seen about the same occupancy in Business class for UA or CO. Given how impossible it is to get upgrades/awards on CO, they muct have a larger proportion of paying customers than UA. Anecdotal, I know.


That has been my experience having flown UA and CO business class right up to the amenities kit, attention from FAs that UA can only match in a fraction of the flights, availability of functional empower outlets, food selection, etc.

The current climate is what makes the yields nad the proposals in this thread extremely important. It is a consequence of a downturn in travel and an increasing number of overhang in miles and elite statuses in all the airlines that they cannot continue to support as if they meant nothing.

But then you also said originally that most of those things do not matter to you. What is "broken" with UA that you are attempting to "fix" with a solution of further degradataion of benefits?

Customer loyalty should be built from the ground up. The FF program should be the icing on the cake.

Run a good airlines with good performance records and you are set. Instead, most airlines use the FF program to make up for their inablity to run a good operation.

Example below. Would you rather have one or two?

1. Sorry for the problem, have some FF miles on us?

2. We will take action to make sure this never happens again, and will check back with you after your next few flights to make sure our improvements are working. Here is my direct number, call me right on the spot if this happens again!

If I wasn't clear on this, there are two different constituents here. Premium fare paying passengers of business class and coach flying FFs with lots of miles wanting an upgrade (I will ignore the small intersection for the moment). I fall in the latter category. For the former category, loss of services is a big concern. If upgraders are complaining about the degradation of services in UA business class imagine what the premium fare paying travelers must be thinking. If there are no corporate constraints, I can see these people migrating to CO if it offers a better value for their money. It is my assertion that UA cannot continue to satisfy both constituents with the same class of service.

As I am in the upgrader category that will rarely buy a business fare I would rather have a intermediate upgrade that I am more likely to get without silly rules than have a "pie-in-the-sky" promise of an upgrade into the current business class with fare rules and capacity controls that leads to more disappointments and lack of loyalty than satisfied FF customers.