BearX220

It is standard FT myopia to cheer the screwing of the vast majority of an airline's customers. This is based on the assumption that most tangible benefits should flow toward the top 2% or 3% of customers, who are disproportionately present on FT. Unfortunately you cannot sustain a business fawning over the top 2% and alienating, or at least acting indifferent toward, the other 98%.

What people tend not to see is, turning Silver into a big nothingburger was an inevitable consequence of the merger. Too many elites chasing too little inventory on the combined, normalized, slimmed-down network. What customers have a right to resent are (A) hiding the coming dilution until late 2011, and encouraging customers to make buying decisions in pursuit of benefits the airline knew were going to go away, and (B) the absurd, fraudulent rhetoric about how MP and everything else were going to get better and better.

We'll see. I've come to really despise and root against this company, and I would be very pleased to see UA "haunted," etc. as you say. But I also believe that in a market dominated by only three or so serious network carriers, UA is less and less vulnerable to anybody or anything, especially customer exit action. They have determined there's no reason to reward loyalty when most customers will keep showing up anyway. Much easier to pull that off in a three-airline market than a ten-airline one.

The big X factor is, can UA do as well when most customers just buy the cheapest fare? The MP program directs a lot of incremental revenue to UA, as thousands of sub-1K travelers spend an extra $30 or $40 every day to book UA instead of a cheaper competitor. UA must have data suggesting that they'll do OK in a mostly price-driven environment. I am not so sure.

raehl311

As a formerly-plat now silver, while I'd certainly LIKE E+ more than 24 hours before check-in, I'm not going to jump ship.

Why?

Where would I jump TO?

24-hour E+ access is still better than the *NO* E+ access on any other airline.

Discount airlines don't fly internationally, and frankly, are not even discount airlines anymore. I haven't found a Southwest ticket cheaper than a legacy ticket in quite some time, even factoring in bag fees.

So, while the silver benefits are pretty skimpy, they are no skimpier than they are on any other airline.


Besides, as bad as this may be, it's not nearly as bad as the screwing I got in the NW/DL merger. I feel loved by comparison.


Where CO *IS* likely to lose me is if they don't get on the rollout of internet on planes. That's a big win for DL.

BearX220

That's exactly the customer-side calculus UA is counting on. The goal for the UA customer experience is to be seen as not substantially worse than DL or AA.

Often1

UA has made the smart decision to cut capacity rather to hand out money losing fares. Even if people were inclined to jump ship (which they won't) there's nowhere to jump ship to. Benefits aren't significantly different elsewhere and there's less competition.

UA doesn't want to lose the deep discounter, but it also isn't going to bend over backwards to keep him.

LAX

AFAIK, AA & US (not sure about DL) allow their lowest level elites to book exit row/bulkhead in advance. That's at least equivalent to E+, but often better. Sure, there are finite number of those seats, but I at least have some control over where I will be seating. I am not particularly fond of checking in at T-24hrs to see if I can grab a MIDDLE E+ seat. Perhaps some still see that as a valuable perk.

Unless you fly on routes there are minimal competition, UA is rarely the cheapest. In the absence of the E+, pax can easily choose other carriers that suit them rather than paying a premium to fly UA.


Rest assured you haven't seen the last of the screwing.

LAX

Live4Upgrade

Because many airports (SFO being a prime example) allow anyone with Premier Access to use the "priority" security screening. Priority security at SFO and EWR is a joke .... it's usually as long as normal security line.

I agree that the Boarding Groups has taken care of most of the gate area issues.

If you look at the list of passengers standing by for F upgrades, on many flights there are 1Ks who don't clear upgrades. That says to me that UA has plenty of well-traveled, well-paying customers even if they lose some Silvers to AA/DL.

It's the old saying .... 20% of customers = 80% of profit.

The dynamics of reduced capacity and higher number of high-tier Elite members means the airlines simply don't need the business of 25k/yr fliers like they did in past years. The pendulum has swung .... in the direction of the airlines.

UAzip

THIS.

Allowing Silvers or those trying to get to Silver to make their travel plans for 2011 (and even into 2012) based on the rhetoric that the new MileagePlus would be an improvement, then announcing in late September that come early March, the rug will be pulled out and that business you threw to UA/CO that you could have taken elsewhere will get you incredibly diluted benefits is the really troublesome part. If they announced the changes early in the calendar year that would be applicable for the following membership year, then no complaints about bait and switch could be made. But yanking the rug out from under people the way they did with the timing they did demonstrates that they take people like Silvers for granted. Why should a Silver try to be loyal to UA after this?

BearX220

You're right about the pendulum part. You're wrong to say the airline "doesn't need" the business of sub-50k flyers. If only the 1K/GS cohort booked and flew UA, and everybody else defected, the outfit would collapse in weeks. The question UA is tinkering with us, what's the least outlay we can make (in terms of loyalty rewards and amenities) in order to fill the plane at optimal revenue per passenger?

This is where the profitability game is won or lost, in the same sense that a presidential election is won or lost among independent voters. You can't win with your hardcore loyalist alone.

UA "needs" every customer. It wants to pay the lowest possible acquisition cost for every customer. Right now it is seeing if treating 0-50k flyers like crap will result in any real, practical diminution of revenue.

Obviously they shouldn't, in a straight sober analytical light. But the whole FF game is built on more emotional ground -- witness the operatic, deranged breakup letters FTers post when they're switching airlines, as if they were leaving wives or mistresses. On this front, too, the pendulum has swung in the airlines' direction, as customers are swooning and mooning, weepily, over their various and increasingly worthless precious-metal cards while the airlines regard the whole thing with cold emotion.

reddirt14

Well seeing that all of you are active posters here and comment about your flying experiences, I take it you are still flying COUA. Assuming that, I'd say UA is doing a very good job at how low they can reduce the benefits and keep their customers. Face it, everyone complains, but few walk. The few that do, don't seem to be affecting COUA's bottom line. This post is fun rhetoric, but lacking in any actions COUA could care about. Not trying to be mean, just pointing out that COUA is pretty good at sifting through the talk. These guys are monitoring sales and everything is going according to their plan as opposed to what people on this site might have you believe.

Baze

If everyone on FT that threatened to walk actually did walk CO/UA would be in....


wait for it...


...The same position they are now. It wouldn't make a difference in the bottom line. The AA walk to UA, the UA walk to AA, etc., etc., etc. It would all be a wash.

Often1

+1 - Which is why the people who threaten to walk, don't. Usually the reason people change carriers is that their travel patterns change and their old carrier doesn't serve their needs or their employer mandates travel with another carrier.

For all the bravado and bluster, there's no carrier out there wooing people with low spends. Except maybe WN. But, my UG % on WN is lousy !

entropy

Well, hopefully people will start to change their flying patterns. I don't see any reason to stay loyal to UA if you are a <50k flyer if you live in SFO, NYC, BOS, WAS, or any other city that has significant competition especially from carriers that offer a better product for the everyday traveler (B6, VX, WN).

It is important to note that the CO folks running the show don't have any experience operating in a truly competitive environment. They were Texas Air and People Express, running a po-dunk operation with fortress hubs in IAH and EWR(and a hublet in CLE). If you live in IAH and EWR and travel for business you're using CO (unless you don't value your time and really want to get segments on another carrier). That's what they counted on: you fly CO because they've got the schedule. UA has a route structure that exposes them to competition in most of their major markets, domestic and international. MileagePlus was built to compete with that (even in the alliance scheme you had to fly UA metal to get e500s, CR-1 and lifetime miles). So we'll see if they learn how to use the program to win customers rather than piss them off.

RNE

Take it from this "oldly" minted MBA: The airlines (all of them) are going to make life tougher for 2Ps, not better.

LAX

They will then split whatever revenue there will be left on the table, after the "minors" taking its (perhaps big) bite, instead of one airline with most or all of it. Fair game, I supposed!

LAX

naeglerian

Well, only time will tell whether these business decisions make sense or not. Yes, the accountants made their calculations, but obviously not all business plans end up benefiting the company. I am nominally still a 2P this year, thanks to the last-minute release of the details of the new MP program (I would have credited the miles to another program), but as it stands, will probably never credit any more flights to MP. The effective loss of E+ was the deciding factor.

This doesn't mean I will stop flying United, but I certainly won't go out of my way to fly with them - in other words, I have no loyalty anymore, since there's no benefit. Best just to go to another airline/plan. I have that luxury since most of my admittedly limited flying (hence 2P only) is for leisure travel.

I am a bit confused about the logic/reasoning on this board sometimes, though. Supposedly E+ access is now restricted because higher level elites were being displaced. At the same time, some of these elites say that the E+ benefit for 2P is not devalued, since there will still be access at T24. How do these elites know there will still be E+ seats available? And do they really think that a middle seat in E+ is a benefit? Also, some of these higher level elites think that Premiers will vanish in droves, opening E+ availability, at the same time, they think that the effective number of Premiers won't go down, because there's no other option, or there will be new members defecting from AA or DL. So the availability issue is the same.