spin88

You think just like I do. When I fly DL, I get to use the SkyClubs - and the SFO one is great - with my AMEX. That tips me to DL vs. VX...unless its a route that I don't think I can get an upgrade on and VX serves it. I love VX, and am perfectly happy flying them (I get MCS) but combo of SkyClubs+Upgrades swings much of my business to DL.

If its head to head, and I'm paying for First, would much rather take VX, but then the main head to head route I take is SFO-JFK, and SkyClub+lie flat wins there too...

iflyuaaa

i'm a GS and i think selling upgrades is fine. i never buy F for domestic, and if this puts me in the back on a 2 hour flight from denver to SFO, oh the horror. 2 hours, free meal free alcohol it's really not that bad.

AirbusFan2B

I would be interested in seing reliable stats for UA's F upgrade %. On my ORD-LAS flight this week, 1 F seat was upgraded + 19 sold. On the return, again just 1 F seat was upgraded + 15 sold. I had RPUs applied to no avail. All ORD-SFO/LAX/SAN/PSP/HNL r/t's I've flown in 1Q17 were similar with several featuring just a single upgraded F seat sometimes out of 28 F seats. ORD-PSP had 0 upgrades both ways with 12 F. I've flown 90,000 miles ytd and can say this is the norm. So that exceeds DL's stated 80% goal by a mile. If UA becomes more aggressive, then the upgrade program is dead. Given UA's weak financial performance vs DL, does anyone think UA's business model with 'selling' upgrades might be backfiring?

sinoflyer

Behind the self-aggrandizement that often clouds FT, is a nugget of truth like this one.

AirbusFan2B

Incorrect. Delta has stated publicly that 5 percent of its customers account for 26 percent of its revenue. Believe it's similar on UA. UA is actively in the process of pissing off 5% of its customers (its top elites.) Beware, UA. Some city pairs have real competition, e.g. ORD-LAX & SFO-NYC.

sinoflyer

You're making an erroneous assumption that the so-called 5% behave in lockstep. They don't. Their travel needs and expectations are just as diverse as the rest of the 95%, which still generate the bulk of the airlines' revenues.

SkiAdcock

I know someone who's doing the exact same thing, except w/ AA & AS/VX. In the past it would have been AA ALL the time (or UA, as he's MM w/ UA too). But thanks to the changes on revenue/mileage calculation, he has AS/VX in the mix at times over AA.

Just as I know FTers who have said screw it & now just book paid C/F of airlines that have best prices/good service. In the past they would have been all UA/AA & never looked elsewhere. Now their golden handcuffs have been broken, & while AA/UA is in the mix, neither is no longer the only choice as it was when they chased the upgrades.

Cheers.

YadiMolina

I don't think of airlines in a similar fashion because of the order of magnitude of spending. I spend $1000 a year on BestBuy. I spend $20,000 a year (of my company's money) on United. I don't expect an upgrade, but I am interested in a perk.

I bought a $1500 mattress last weekend. At the first indication of waffling, the salesperson knocked 15% off and eventually, yes, I upgraded from a queen to king.

But I agree airlines are an odd business.

SF1K

As a GS do you see the back that often? And to me it is "Horror". I'm a domestic road warrior sometimes several trips a week - none international so SFO based never going to make GS. I buy F even going to LA as I can't deal with being pushed/shoved/crowded. It's a personal psychological issue - again this selling of upgrades had no effect on my comfort/seat on this flight because I was already in first. But the effect it does have is that I will no longer strive for 1K. I'll settle for Platinum as a 2.5MM. And I know my $ alone won't make a difference but if I drop my UA revenue by 25% or more and I'm sure others may as well then the over all effect of selling those upgrades I think will be revenue negative.

N104UA

I would would then guess of that 5%, 1% of the pax make up 10% of the revenue (Global Service)

It is not pissing off those top 5%, if you look at the upgrade list before T-24 you will notice that there are usually some upgrades already cleared, these are the 5% (GS and 1K). There is a difference in the top 5% and 6%-20% (Platinums, Golds, and Silvers) UA knows who their big money makers are and they treat them well (Mercedes transfer at hubs for example), it is people who think they are in that 5% but really aren't are the people who they are pissing off because those people think they are entitled to something for buying a $200 RT ticket from LAX-ORD. If you want to fly first regularly either (a) buy it outright or (b) be in the top 1% and they will take care of you.

iflyuaaa

i have been sitting in the back, but mostly my own fault. been doing a lot of SDC to flights that are already full. i don't fly domestic much. but last week i have 5 segments i think. 2 were up front and 3 in back. all 3 were legs that cleared and then i did SDC. the horror of flying SFO-PDX in the back. it was no big deal. the one i cared about, SFO-ORD red eye on a 777 did clear. btw, are those the old F seats from pre IPTE? i thought those were all gone. i guess i was wrong. oh, and one of my segments i SDC'd was an M fare that was M-UP before and i lost. no big deal.

SF1K

Glad it was no big deal. Again that is the psychological difference. I cannot stand sitting in those tiny Y seats without at least an empty middle. So I just won't do it. In the past 1K meant that I could count on upgrades at a certain % of the time, so I spent all my $ on UA, as the upgrades were kind of a "discount." Since UA no longer offers me that discount I'll shop around. Capitalism at its best - since UA thinks its the way to go so should us customers.

spin88

I made a lot of money buying Delta and VX when Jeff was in charge with similar ideas. Come back Jeff, come back. Give me another similar investment opportunity.


80-100K+ MQM, but then I'm buying my tickets, perhaps passes get a different view of things.

It has for me. Pay UA $580 RT SFO-SEA (often cheaper, they are the low price leader tat this point, get offered an upgrade for $49 bucks, no meal. Pay Delta $580 RT SFO-SEA, get upgraded, get a nice meal. Advantage Delta.

AA has said that 50% of its revenue comes from 13% of its elite fliers. https://qz.com/533501/half-of-americ...its-customers/

Here is a cite on the 5% are 26% of DL's revenue. http://fortune.com/2015/11/17/secret...-elite-status/

I don't know a recent figure for UA (they have lost so much high value traffic they are now MUM on these type of figures) but historically United was the MOST dependent on a core of FFers. In 1997 they said that 9% of their traffic represented 44% of their revenue.

Think about that 9% of the bodies are 44% of the revenue. And elites are more important than that: it costs the same CASM (cost per seat mile) to fly super elite guy weighing 250 lbs with his bags and paying 45 c/mi as it takes to fly kayaker weighing 250 lbs with his bags and paying 8 c/mi.

United is in the dumps because those able to/willing to pay more don't want to put up with United. In contrast this is why Delta is doing so well, and why VX survived.

$20,000 is "bread and butter" not special. But people - unless they are flying a gazillion miles - paying $30,000-40,000- $50,000+/year are the profit margin. Absent them, the major airlines would not be profitable.

stevendorechester

Good on United for doing this. Personally I don't think any airline should be offering free upgrades. The top airlines in the world don't upgrade their elite members except in rare cases and yet are doing pretty well and have many loyal customers. I remember speaking with a gate agent once and he told me that every flight they get elite members of U.S. carriers trying to mooch a free upgrade, since in North America upgrades are seen as some kind of civil right. You want first class then pay for it. That's the way it's done everywhere else in the world.

SF1K

That is fine but then the airlines need to stop using the upgrade as a marketing tool.