BackOfTheBus

NW, in my opinion, will be the most attractive airline for passengers flying on low or mixed fares in 2004 (midweek no Sat-night stay business pax excluded), who fly 0-74,999 miles a year.

Who exactely will be flying NW?

Flyers 0-25,000 miles per year because:

-NW coach is generally no worse than any other airline's, except for AA's MRTC and JetBlue/Song (If you fly <25k/yr you cannot get into UA E+)
-low fares generally available (NW does a good job at matching fare sales)
-Plethora of mileage-earning partners (DL, AS, CO, International partners, etc.)
-Miles do NOT expire (see Southwest/JetBlue/AirTran)
-Good route network...
-Fairly good and consistent customer service.
-Many international destinations (including on KLM).
-Generous FF promos (FFF3, etc. - try that on CO or AA!).

Flyers 25,000-49,999 miles/year because:
-All of the above
-No other airline (except HP and CO(but only for higher fare-qualified flyers starting 2005)) offers unlimited space-available upgrades domestically. Upgrade % is usually (not always) 50%+.
-50% mileage bonus (only on HP(?) and CO)

Flyers 50,000-74,999 miles/year because:
-All of the above
-Unlimited domestic upgrades with at least 75% success rate.
-100% mileage bonus.

Even 75,000-99,999 miles/year flyers may be interested because of:
-All of the above
-95%+ success rate on upgrades.
-125% mileage bonus.

NW will likely loose some 100k+ flyers as they can get:
-International upgrades on DL, AA, UA.
-That and unlimited upgrades on US (Although their domestic FC is worse than NW's!)

Here is a hypothetical breakdown of influx of flyers from other airlines (note, no-Sat night business pax will NOT flock to NW- the Sat night stay req. in most NW fares still scares most away):

DL- Mostly ex-Silver Medallions and Gold Medallions, who would simply no longer qualify under DL's new scheme. Also, SOME Platinums (also no longer qualify and angry about no more unlimited domestic upgrades on cheapER fares). 0-25,000 mile flyers (non-elites) are unlikely to switch, unless they want to 'try' for Elite.

CO- Pretty much the entire ff membership, except for a) avek00 b) higher-fare business flyers c) people who cannot live without ice cream sundaes on transcons or G. Bethune's welcome message.

WN- Many flyers may reconsider their WN patronage with double online credits (for booking on southwest.com) going away on Jan 1. Flyers who barely do 4 trips a year may switch to NW, as their miles/points will not be lost every 12 months, as they are on WN. Also, WN has had some pretty poor availability on their LOWEST fares, however business travellers who fly WN a lot (and have a CP!) are unlikely to switch.

B6- JetBlue's FF program is really mediocre. If your purpose in flying is getting from A to B and then again getting from A to B for free, NW is better to B6. Needless to say however, NW FC is not MUCH better than B6 coach I don't see many people switching from B6 to NW, but occasional new mileage addicts who are sick of watching ESPN may do so.

AA- If you fly less than 25,000 miles a year, you will NOT switch to NW, as AA MRTC is vastly superior to NW coach. AAdvantage is also a good competitor of WorldPerks (less miles but more valuable). If you are an AA Gold (25k) or Plat (50k), it's a different story. As you don't get VIPOWS (no international upgrades?), you may consider switching to NW because of the dangling carrot of FC upgrades. Beware, though, as a NW Silver you will occasionally have to experience NW's S&M coach cabin

UA- Looking for a more financially stable airline that does not hand out status like candy? Try NW UA 25,000 mile or less flyers have an identical experience on both airlines (crappy E-) coach. For UA 25k and 50k flyers, the question would be: do they prefer E+ or a mix of FC and E-? It's their choice!

US- Unless you are a 100k US CP, I see no reason for you to stick with 'Trailer Trash' airlines (just kidding)! Dirty planes, FC that's worse than NWs, high fares, etc.... US Silvers and Golds, as well as non-elites will find a better place at NW!

Please feel free to amend and/or continue the list...

I don't forsee any migrations of historical proportions, however I would not be surprised to see 90% load factors next summer on NW. K fares are becoming harder to find on NW, as many NW elites who used to book on CO seem to be seeking out NW metal operated flights!

[This message has been edited by BackOfTheBus (edited 10-26-2003).]

fromYXU

Interesting analysis, well done. It will certainly get a lot of opinions.

Just a small question: With all the changes over the last few years on the various programs, is there data on FF changing alliances? I understand the dificulty of obtaining data on this, but someone in the industry should be able to report on movements in the FF.

Radiocycle

I fly over 150K a year with nwa and will continue.

Most of my flying is domestic and I have had excellent luck getting upgraded to FC.

The international certificates offered by other airlines don't really matter to me since I won't be using them.

When I travel internationally I used WP points anyway.

RC

magic111

One question I have is the alleged 150% mileage bonus for "Flyers 75,000-99,999 miles/year flyers may be interested because of:"

I thought it was 125%

[This message has been edited by magic111 (edited 10-26-2003).]

kb1992

EXCELLENT ANALYSIS ~~~

BackOfTheBus

Sorry, bonus is indeed 125%, not 150% for Plats.

RC, I wasn't trying to say that 100k+ flyers should not fly NW but rather that international upgrades are what might draw some away from NW With DL's upgrades only applicable on higher fares, however, I personally would not be really tempted... I guess UA and AA with their MRTC and E+ could be good for a flyer who flies a mix of international and domestic and insists on riding up-front on the international legs, without having to use their miles...

keithguy

Honestly, there aren't that many people who fly solely based on frequent flyer programs. Believe it or not, but a large portion of passengers on every flight do not earn frequent flier miles.

fromYXU

True, and those who have FF cards probably fly more than one carrier and have no status on most if not all.

There are some, most of us on this board, who pay close attention to benefits awarded to FFs. My original questions comes back to your point: do people actually shift allegiances based on the program, rather than fares, destinations...

Jano

That depends on how fast NW can put those parked DC9s back to service:-)

doobierw

...and the 915 of us furloughed pilots who will be happy to fly them for you....

kathnunley

I think most of the DL defectors will in fact be the Platinums. Not much has changed for the Sliver and Gold members - it's those of us who were Platinumm that lost the most. I have no problem qualifying under the new program, but as most of us have noted, there is nothing "there" at the top anymore. They put us upfront on every flight for years, and now they tell us, upgrades on 15% of your flights? I don't think so. The Platinum members are the ones leaving for NW.

wldtrvlr

YXU, I am only one person, so I don't know if I am a good example or not.

I was with a company in the mid 80's that had an alliance with NW. To be quite honest I don't even rember what it was, I think it was like 5% off tickets, or some extra miles for signing up a new WP member. Anyway, it was not a huge deal. However, it was enough to get me started flying NW even though I was based in RIC and the ONLY NW flight at that time was to DTW. I could have flown AA or US direct to most places I went. NW was my primary carrier until I moved to TX in 1998. At that time I had never been elite, but I decided to find out what "elite" meant and then studied some of the plans. I chose to earn Gold on CO due to them offering segment qualification at the time and me doing a lot of short trips throughout Texas. I could have flown AA or DL direct for the same amount but I could fly DFW/IAH/AUS or SAT or wherever and earn Gold so I did that. After the first year I found out that NW had a much better Elite program and as a CO elite I decided to "switch over" to NW and earn elite with them. My flying has decreased over the last two years and I only qualified silver on NW and plan on doing it again next year. So my point is I based my flying on the airline/program since for me the destinations and price are generally the same. I don't mind connecting and I just get a Club membership to "kill" the connection time. I have had a few "glitches" with NW but I expect that with every major company. They have always been very good at handling it and have never left me in a "lurch". I think how they handle the problem is about as important as preventing the problem. Which I am sure all airlines try hard to prevent the problems, but we all have problems at times. So NW has won my loyalty by not giving in to every thing every airline does, standing there ground on numerous issues over the last years, taking care of me when things went wrong, and getting me where I need to go.

I know the airlines I detail are all in the same "alliance" but they are different airlines. I would never have considered CO unless it was in an alliance with NW and I have used most of the CO miles I got earning Status on them by flying on award tickets on NW metal.

Hope it helps.

bk42

Good analysis.
They have plenty of planes parked that can quickly be recalled to serve additional frequencies. And plenty of pilots on furlough that would be more than willing to fly them.

slippahs

... and when Continental loses its customer base -- realizes no one except for a few handful of people will buy a full fare ticket just to get their EQMs -- and when NW buys CO out, there'll be plenty of seats on NW to go around...

Eidetic

On the point that many (most?) pax are not in FF programs, on 17 Oct I was outbound IAD/AMS on KL. The Y check-in line had over 200 people in it... the line was about as long as the security line (which ran parallel to it in the opposite direction). There was no one in the elite/WBC check-in line. I walked straight to the elite counter, avoiding about an hour or more in queue.

IAD during the Friday, 5 to 7 p.m. bank is the most chaotic (check-in) mess in the U.S. (IMO).