AA blows an opportunity

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Aug 20, 2002
American pulls a U
AA could have pulled in a ton of disgruntled passengers from U and UAL. But apparently managment is taking the "sheep" approach. If Crandall were still there, you''d be offering double miles doing everything possible to capture a market that was being handed to you.
Wouldn't it be a blast to know what Uncle Bob would be doing to the competition now? I'm remembering that quote of his, something like "first I try to do what is right, then I do what I have to do"....

Another historical note, Ray Kroc (McDonald's restaurant founder) was once asked what he would do while a competitor was drowning.

Ray replied "stick a running garden hose in his mouth".

Seems that now the only folks following this playbook are the SW crew.
On 8/30/2002 12:15:56 PM

American pulls a U

AA could have pulled in a ton of disgruntled passengers from U and UAL. But apparently managment is taking the "sheep" approach. If Crandall were still there, you'd be offering double miles doing everything possible to capture a market that was being handed to you.

Not so sure about that. FF Miles are carried as a liability so it wouldn't make much sense to give double miles for a $49-$99 fares. There's very little "Loyalty" in that price range anyway. Unfortunatly It's strictly bargin hunters.
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AAmech - empty seats are a bigger liabilty that double FF miles out of PIT, PHL and CLT. Rather than jump at an opportunity to get more paying customers, AA just jumped on the "if we make refundable fares inflexible, business will have no choice but to pay more". That, IMHO is a horrible miscalculation. Look, if you are a corporate travel manager, you just saw two pretty big travel headlines in the past couple of weeks - Southwest just lowered their HIGHEST walk up fares by a hundred bucks. There is NO PLACE they fly that will cost more than a $299. And then you read how non refundable tickets are given full credit towards another flight. Then you read about U,UAL and now AA adopting a policy of "use it or lose it". You see them implement a hundred dollar fee, just to stand by for a flight. If you are spending your companies travel dollar, how are you going to justify the "risk" of perhaps losing the fare you buy on AA and being forced to buy a last minute walk up fare over just paying whatever the best fare is on Southwest? Please don't give me the assigned seat argument. Travel managers are looking to save money any way they can, and I really doubt that an assigned seat is going to be worth the "risk" associated with the new "use it or lose it" policy.

Instead of "me tooing" U's policy, they could have grabbed a boatload of disenchanted U "elites" who have been told that their miles on non refundable tickets no longer apply to their elite status. I really think that if Crandall were there, he'd have gone for U and UAL's throats after they announced that policy. Hell, he might even have found the perfect opportunity to reintroduce value pricing. And it's unfortunate... American Airlines, who used to be a leader, has reduced themselves to being a "me too" airline.
Gotta agree with you--AA is missing a golden chance. Instead of driving a stake in U and UA's hearts, they're letting them off the hook (assuming that CO, DL and NW go along).

The standby thing is pretty stupid--makes it that much more difficult to move their own non-revs on the late flights if they don't take advantage of emptying out the flights...moving standbys early also gives them room to take passengers if another airline cancels a flight in a later bank.

Last, but not least, I have to wonder what exactly is going through these folks' minds. They cry about us business travellers reacting to their earlier behaviors (by using advance fares, discount airlines, etc.) yet they come right back and try to club us again. For a group of companies whose product cannot possibly be delivered as cheaply as Southwest or Airtran, and whose sole point of differentiation is service, they sure are sending the wrong message to their bread and butter customers during THEIR time of turmoil.
(I'm a little late on the reply), But your absolutely correct about my "ex uncle BOBBY(Crandall).
He would have been like a "great White" who just smelled blood, in the water.

Happy LABOR DAY !!!!!!1


PS. For the first time, in a loooong time, I'm ACTUALLY scheduled OFF today(as it should be for ALL of us in the labor pool), and I'm really savoring EVER HOUR !!!!!!

Back to work tomorrow(Double time, and one half)
To be fair, what is the possibility of standing by for an earlier WN flight if you're on one of their non-walkup fares?

Used to be zilch... Is that still the same?
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eolesen. Quite right...couldn't stand by for an earlier flight on SWA without upgrading the ticket to full fare. But here's where AA is making a mistake. Think about all the arguments against SWA and one that invariably popped up was "I can standby for an earlier flight on (insert airline name here) for nothing". Now AA is incorporating that "fuzzy math" to standby's. Want to stand by? That'll be a hundred dollars sir. Not much different that SWA. Except - SWA just lowered their highest walkup one way fare to $299..has AA? SWA gives you full credit of an unused ticket toward the purchase of another ticket..does AA? It would appear that AA and other are trying to incorporate the "restrictions" of SWA without incorporating any of the benefits.

Look at AWA - they lowered their fares (value pricing anyone?) and low and behold, they are doing better than AA. You want to restrict who "upgrades" to first class on your flights? Fine...not a bad idea at all. But why not shock the world by charging lower walkup fares for the business traveller who isn't travelling today because his company cut the travel budget? Try that in todays market, then have the cajones to stick with it (as AWA has done). Be a leader, not a follower. IMHO, you'll attract more passengers than More Room Throughout Coach or the Advantage program combined.
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G4G5 - I don't know about that. The whole thing seems to have come about because business travel is booking "non refundable" tickets whenever possible. They did it when I travelled for business a lot, and they do it even more when I travel for business only occasionally. I think this is a misguided attempt to get businesses to pay more for the "flexibility" offered by a full refundable ticket. I think that now business travel managers will be looking at who gives them the most value for their travel dollar. And that's why I say AA is missing an opportunity. Someone who travels weekly on US, but only occasionally on AA will be viewed by AA as a "once a year traveller" and treated accordingly. I think AA should have done whatever it takes to insure that this person flies AA weekly and US when they are the only alternative.
While I have not seen it in writing, I would not be surprised if the fee is waved for the FFer folks. I doubt that AA will do anything to hurt their business market. What they are trying to do is restrict the once a year travelers.
In no way would I way minimize or take any credit away from Southwest for their consistently profitable game plan built upon "doing the right thing."

On the other hand, they (and FL, TZ, B6 and F9) have consistently had plenty of help in their success from the follies of of the likes of US, UA and leader-turned-copycat AA; perhaps never more than the latest short-sighted decision concerning their use-it-or-lose-it ticket policy--a knee-jerk reactionary attempt to tame a costly, yield-crushing monster the U.S. airline cartel created through their own irrational (a gross understatement) pricing model that has become even more dysfunctional than it already was.
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