LH Takeover: Your fears for LX Travelclub? - Everybody post please

Old Aug 12, 05, 1:58 pm
  #61  
 
Join Date: Apr 2004
Location: Nairobi
Programs: LX, AZ, BA, LH, SA
Posts: 313
Originally Posted by LoungeLizzard
I strongly oppose the point that the more "generous" the FFP the more money an airline looses.
Maybe BUT evidence suggests it works well the other way around, i.e. profitable airlines run FFP which are not generous with discounted Y class pax (LH, BA, IB etc...)
hilltopper is offline  
Old Aug 13, 05, 1:56 pm
  #62  
 
Join Date: Jul 2005
Location: Switzerland
Programs: Lufthansa Miles & More
Posts: 33
OK, I will probably repeat many things, but as everyone is to write...

I always found STC very easy to use :
- minimum miles in Switzerland / Europe very clear
- miles depending on aircraft class (F / C / Y) and not on some strange reservation category
- benefits and conditions quite clear to find on STC website (just have a look at Flying Blue Website to understand what "confused" means, even if it is FAR better than older AF Fréquence Bleue)
- nice STC website, easy to use, quick and clear.

And above everything, the impression of getting benefits, even as a "Blue" member, and not being caught in any FFP, collecting miles but not being able to use them. I did recommend STC to many many friends and relatives, just because everyone could take advantage of it.
SWISS is offline  
Old Aug 14, 05, 2:41 am
  #63  
 
Join Date: Mar 2005
Location: ZRH, Switzerland
Programs: M&M, LHW, Shangri-La.
Posts: 458
How much does it cost to keep TC alive?

For those of you who allways wondered:
LH calculated synergies EUR 5M (Yearly) for integrating TC into M&M.

Click here to read the LH financial analyis of the Swiss deal. (P23 shows the various savings, and P21 shows the integration of TC into "Europe's leading Frequent Flyer Programme". P15 shows the Swiss Longhaul Network with several errors.)

As mentioned before, there are more than enough options to keep some of our current benefits alive in M&M.
The question is if LH thinks it's worthwile doing so or how to convince them.

At least, the presentation also mentions a "premium customer base via current Swiss Frequent flyer programme".

***

@Hilltopper: The question is if offering little or no miles to cheap fares is what makes an airline profitable and if not attracting low fares is good for any airline.
The generalization you make may very well be the one LH makes and that would be a big mistake.

As far as evidence goes, how about AirBerlin? Looks like they're doing pretty well (2004 data): (link)
Die Zahl der Passagiere stieg im vergangenen Jahr um 2,4 Millionen auf zwölf Millionen, wie das Unternehmen gestern mitteilte. Der Umsatz erhöhte sich um 18,9 Prozent auf 1,05 Milliarden Euro.

They offer 1000 miles to everybody, regardless of price paid. Awardtickets cost 15k oneway but they have no restrictions and no taxes. I find that generous - and will gladly join if LH doesn't like my business.

Last edited by LoungeLizzard; Aug 15, 05 at 1:59 pm
LoungeLizzard is offline  
Old Aug 14, 05, 3:39 pm
  #64  
 
Join Date: Feb 2004
Posts: 1,389
I like STC because of

1) possibility to transfer Amex MR 1:1 to STC miles
2) only 20000 miles for european awards
3) 8 segments on award tix
4) possibility to book award tix only 1 hour in advance
5) good choice of airlines
6) good award availabilty

compared to M&M, 30000 miles for european awards is an 50 % increase while flysmart awards (15000 miles) require a saturday-night-stay and are not available at all to non-etix-destinations like BRN unless you book 7 days in advance.
jarino is offline  
Old Aug 15, 05, 2:11 am
  #65  
 
Join Date: Sep 2003
Location: Thurgau, Switzerland
Posts: 183
Originally Posted by Volvic
What I'd like to see and I'll never see, it's a FFP structure where you get as many points as the ticket cost (or even better te financial gain the airline got from your flight).
I don’t agree.

When looking at FF programs, we should distinguish two different things.

First, there is the elite status with the well known benefits for the best customers. Swissair had those black “Travel Club” cards many, many years before any mileage program. As for this status, it seems reasonable to base it on revenue from the passenger.

Second, there are the miles / points. The main goal of the miles is NOT to reward good customers but to change behaviour. A good example is Migros (Swiss supermarket chain): Migros gives double points on Thursdays. So all Swiss pensioners plus Mrs Yak40 go shopping on Thursday instead of clogging the aisles and checkout counters on Friday and Saturday. This makes economic sense.

Whom does an airline attract with miles? It’s not the VIP paying First – he wants a good product, not miles. And it’s not really the business traveller either. When I go on a business trip, the reservation is made considering schedule and price, plus maybe flexibility and comfort on long hauls. Tell my boss I’ve got to fly one day earlier and for double the price so I can earn miles? No way.

The customer most likely to change behaviour because of a mileage program is the leisure traveller. For the upcoming trip to the USA or the Far East, should he fly KL/AF/EK/SQ or pay 200 CHF more for LX? IF he flies LX, he will finally have the 20’000 miles for that weekend trip to Vienna. Didn’t I read somewhere that almost half the miles collected in the STC program expire unused? And didn’t I read that 90% of all STC award tickets are Y within Europe?

On most routes, LX offers neither the lowest fares nor an exceptional product – at least not in Y. So it makes economic sense to have a generous FF program for the leisure traveller.
Yak40 is offline  
Old Aug 15, 05, 3:32 am
  #66  
 
Join Date: Dec 2004
Location: NUE
Programs: *G (TK elite), OW emerald (BA), ST elite plus (AF)
Posts: 2,525
good comment, yak40.

btw, i would also like travelclub to survive but think that it will be highly unlikely to happen. sorry

have you thought about this: if stc is integrated into m&m this does not mean stopping "milage-offers" to SWISS customers ... e.g. AUA does it sometime ... M&M aua milage offer

CHris
f0zzyNUE is offline  
Old Aug 16, 05, 7:24 am
  #67  
 
Join Date: Sep 2004
Location: In a plane over Europe; I mean in the back of a plane over Europe !!!
Programs: HHonors, Scandic, Priority Club, Marriott, AF/KL FB, BAEC, AB TB, LH M&M
Posts: 860
Hello. I ignited a few reactions....
Originally Posted by Yak40
The customer most likely to change behaviour because of a mileage program is the leisure traveller. For the upcoming trip to the USA or the Far East, should he fly KL/AF/EK/SQ or pay 200 CHF more for LX? IF he flies LX, he will finally have the 20’000 miles for that weekend trip to Vienna.
So a one time-customer purchase a cheap Y ticket from EU to the US for the vacation of his life or a low-mid level employee flights for the only time in his professional life the same path but in C *. Does it make economical (for LX) sense to win this customer and provide him with a free round trip in Y to an EU capital ? I do not think so...
* it happened to me a few years ago, I was placed in a flight to the US and I did not really care about the 30000 miles I got but I very weell and vividly remember the dummy hostess who made me wait to disembark after all the other C class passenger and part of the Y ones because she was sure I was a Y passenger who in some way got his way in C class.


Originally Posted by Yak40
I don’t agree.

When looking at FF programs, we should distinguish two different things.

First, there is the elite status with the well known benefits for the best customers. Swissair had those black “Travel Club” cards many, many years before any mileage program. As for this status, it seems reasonable to base it on revenue from the passenger.

Second, there are the miles / points. The main goal of the miles is NOT to reward good customers but to change behaviour. A good example is Migros (Swiss supermarket chain): Migros gives double points on Thursdays. So all Swiss pensioners plus Mrs Yak40 go shopping on Thursday instead of clogging the aisles and checkout counters on Friday and Saturday. This makes economic sense.

Whom does an airline attract with miles? It’s not the VIP paying First – he wants a good product, not miles. And it’s not really the business traveller either. When I go on a business trip, the reservation is made considering schedule and price, plus maybe flexibility and comfort on long hauls. Tell my boss I’ve got to fly one day earlier and for double the price so I can earn miles? No way.

... Didn’t I read somewhere that almost half the miles collected in the STC program expire unused? And didn’t I read that 90% of all STC award tickets are Y within Europe?

On most routes, LX offers neither the lowest fares nor an exceptional product – at least not in Y. So it makes economic sense to have a generous FF program for the leisure traveller.
  • For a Company (LX or Hilton or Migros) a FFP is a tool to gain new Customer and minimize the turn over ratio and after all it's a Cost. OK, they can also gain money (see AC move) if properly managed via cross partnership (but I'll not expand this point).
  • For a Customer (FTers) a FFP is something which should repay him for a certain choice.

My person idea is to optmize the redemption of my earned miles. 20K STC for a flight in Y in Europe for me is a very poor choice. The tax in ZRH (I need to connect there) are terrible. Sorry, no way at least for me.
My dream is or was to burn 30K for a C class inside Australia with QF. For many external reason I was never able to go there and do it.
Second on my list seats a C and/or F flight EU to US but they are terrible expensive compared to *A (BD) or ST (KL).


Originally Posted by LoungeLizzard
So your favourite program would be the ASP (Ashamed Socialists Program) where the airline feels sorry for making profit and extracitng too much money from you. As a gesture of goodwill, they return some of that money back to you.
... I'm not quite sure that this is the reason why FFPs exist.
ASP (Ashamed Socialists Program) ? No. I presumed some guru called it market segmentation... If the service I purchased (hotel , flight or grocery) is sold at 100 GBP and not at 100 USD, I should expect something like an 80% additional value (1 GBP = 1,81 USD today).
It should be the killer for any milage run but it's an other topic.

Last edited by Volvic; Aug 16, 05 at 7:52 am
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Old Aug 17, 05, 5:47 am
  #68  
 
Join Date: Feb 2003
Location: Austria (Vbg)
Programs: LX SEN, BA GGL/CCR, IC Plat A, HH Dia, Hyatt Glob, Sixt Plat, regularly in FS & RC
Posts: 1,548
I have another advantage of STC:

M&M charges additional 10.000 miles for a same day (on weekdays) Intra-European award-flight!!! This is ridiculous!
Frequent_Flyer1 is offline  
Old Aug 18, 05, 5:48 am
  #69  
 
Join Date: Sep 2004
Location: In a plane over Europe; I mean in the back of a plane over Europe !!!
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Posts: 860
Originally Posted by Frequent_Flyer1
I have another advantage of STC:

M&M charges additional 10.000 miles for a same day (on weekdays) Intra-European award-flight!!! This is ridiculous!
A same day (on weekdays) Intra-European award-flight is very likely to be due to 'business' reason. How many same day trip did you made ? I did none for leisure and a few for business and the ticket price was really high.
I understand the required additional 10.000 miles.
Do you want to burn your miles for business reason ?
Please feel free but not try to make me agree with such an usage.
Volvic is offline  

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