Delta leads US network industry with Skymiles overhaul

[FrugalFlyerv2.0]

WT,
I agree with you to a certai extent.  My point is that in Germany LH doesn't have to compete with, for example, Air Oktoberfest for global flow traffic and hence can make the rules for Miles & More as it suits them.  Likewise in France, AF/KL doesn't have to compete with Air Capitulation for global flow traffic and hence can make the rules for Flying Blue as it suits them.  In the USA, DL's FF program has to compete with AA and  UA.  We'll see how it all works out.  You may argue that the EU states = USA and that LH, AF/KL, and IAG = UA, DL, and AA, but in reality it isn't  so (simple).

 

[WorldTraveler]

except the euro flags r competing with each other and other foreign carriers including the ME3


Lifer
Why hold back?
Just let it fly

 

[FrugalFlyerv2.0]

except the euro flags r competing with each other and other foreign carriers including the ME3
 

 
Yes, to a degree the EU flag carriers are competing with each other, but this is somewhat limited.  You'll never see BA or  AF/KL flying FRA-MUC, for example, or LH flying AMS-CDG.  Whereas here, DL operates LGA-ORD, for example.  As much as EU pretends to be one giant open market, as far as the flag carriers are concerned, they're mostly boxed into their own country.  The closest airlines in the EU not being restricted by borders are the LCCs such as U2 or FR.

 

[WorldTraveler]

I accept yr point.
DL can't get this wrong or the failure will be catastrophic...but their track record says they
will succeed

 

[dash8roa]

Delta's FF program changes won't affect me since I gave up on flying them years ago due to their stingy SkyPeso redemption policies, but if this is such great news for their frequent travelers, why won't they publish their new reward-redemption charts?

 
Delta has been first in many phases of air travel,  such as 1.buying used aircraft as opposed to new which is a smart move that does not affect the customer. 2. Dropping the commision paid to travel agents and 3. This latest down grading of their frequent flyer program. Delta had a banner year profit wise in 2013 and how do they treat their most loyal customers, by showing utter distain for the ones who made such high profits possible. Here is a chance for AA and UA to gather in irate Delta frequent flyers by not following their penny pinching move regarding the FF program and making it known.

 

[WorldTraveler]

and yet somehow DL has higher DOT rankings, including in customer complaints, has higher average fares, and of course profitability.

maybe all of those things that some seem to think are measures of success really aren't.

 

[700UW]

http://www.airlinereporter.com/2014/02/dualing-opinons-on-delta-shaking-up-their-rewards-program/

 

[dash8roa]

and yet somehow DL has higher DOT rankings, including in customer complaints, has higher average fares, and of course profitability.

maybe all of those things that some seem to think are measures of success really aren't.

 
I for one hope it backfires on Delta and since AA and UA can duplicate almost any route and they have larger alliances, thus could bode well for AA and UA., even if it meant a small percentage of flyers.   Just my take on corporate greed.

 

[WorldTraveler]

of course you want it to backfire but it isn't hard to realize that DL is doing exactly what this customer said they should do:

I think this is an effort for airlines to increase revenue (they are for-profit businesses, remember) and reward those passengers who they actually make money on. Why should an airline reward people who have found loopholes, such as taking advantage to discounted mileage runs? It’s logical to reward those who help your bottom line. To me this just makes sense and I am surprised it hasn’t happened sooner.

while the counter opinion is led off with

The new Delta revenue-based program is not a good thing for the mileage junkie. Gone are the days where you could pick up a dirt cheap fare, extract as many miles out of it as possible, and use it to get some pretty decent points out of it.

and their bias is clear that DL might actually lead an effort that will be matched by other airlines:

People are going to scream loudly over this, and they will walk to other airlines, but it won’t change where I put my miles… yet. Plus, it can’t be long until other airlines follow suit.

--- and end the practice of handing out frequent flyer points to passengers who tie up seats on multiple flights in order to rack up miles when a single flight could be the most efficient way to carry that passenger.

All airlines in the US are for-profit businesses... and DL is the most profitable of them all. DL has demonstrated that it can attract the right passengers carrying the right passengers who pay the money DL wants despite now being smaller than AA and UA.

The fact that AA and UA still hold onto revenue inefficient policies shows they, not DL, are afraid of making a change that is in their best financial interest while DL will move forward with doing things that will generate even higher profits - exactly what they say they will do and what analysts expect DL to do.

 

[eolesen]

So in other words, rather than address the few people who game the system, let's change the entire program, even if it alienates people who weren't gaming the system?

I don't doubt that the revenue based system will better reward the top revenue customers, but frankly, those top customers were probably not flying DL in order to earn status or for the miles. They're flying DL because DL is going where they go.

IMO, the revenue based loyalty model rewards the customers you already had a lock hold on, but risks pushing out other customers who have to fragment their business for any number of reasons, and also those who are under travel management policies which mandate low value fares. The new loyalty approach doesn't seem to bode well for those travelers, and if you push them away early in the program year, you'll also lose them when they do happen to buy the higher value fares.

I'd be surprised if there isn't a modification which addresses the real frequent flyers. They might not be generating the highest yield per ticket at a micro level, but when you look at the volume and average yields over a year, it's still substantially above average compared to the masses.

 

[dash8roa]

WT, I enjoy some of your comments but your love affair with Delta is a bit much. This move will cost them some lost customers and since most frequent flyers belong to several programs and its no big deal to steer away from Delta.
Why fly Delta and receive fewer miles when AA or UA will help you reach your goals for award tickets.
It will take a while to see the results.

 

[AdAstraPerAspera]

The real question is the competitive impact on other carriers who can't or won't make the change.
 

 
Can you please explain this statement? It makes little to no sense.
 
-astra

 

[eolesen]

Good explanation of the changes from Cranky:

 

[WorldTraveler]

WT, I enjoy some of your comments but your love affair with Delta is a bit much. This move will cost them some lost customers and since most frequent flyers belong to several programs and its no big deal to steer away from Delta.
Why fly Delta and receive fewer miles when AA or UA will help you reach your goals for award tickets.
It will take a while to see the results.

Because DL obviously knows who it needs to incentify to increase their business.
As hard as it is for some to accept, many customers are PRICE sensitive first. If DL is price competitive and if DL already obtains revenue premiums on its network, it doesn't need to offer all the other incentives that others do.

Yes, it could all blow up on Delta but given what DL has done with it's revenues that isn't terribly likely.
And the real fear for many pax is that AA and UA will match what DL is doing and there will be a whole lot fewer miles getting thrown to passengers.
That scenario scares a whole lot of passengers nearly to death.
But maybe that is exactly one of the by products of consolidation that no one wants to admit will happen but could save DL and EAC of the big 3 hundreds of millions of dollars per year.

 

[dash8roa]

Because DL obviously knows who it needs to incentify to increase their business.
As hard as it is for some to accept, many customers are PRICE sensitive first. If DL is price competitive and if DL already obtains revenue premiums on its network, it doesn't need to offer all the other incentives that others do.

Yes, it could all blow up on Delta but given what DL has done with it's revenues that isn't terribly likely.
And the real fear for many pax is that AA and UA will match what DL is doing and there will be a whole lot fewer miles getting thrown to passengers.
That scenario scares a whole lot of passengers nearly to death.
But maybe that is exactly one of the by products of consolidation that no one wants to admit will happen but could save DL and EAC of the big 3 hundreds of millions of dollars per year.
 

 
Delta's profits were with the present mileage program in place. Flyers will vote with there wallets and if they are mileage conscience, it may see a sizeable number of passengers migrate to other carriers. This new mileage program is a major shift in award earning potential and if any are like me, mileage matters when it comes to planning a family vacation.
I tend to lean towards the customer where you seem to be focused on Delta's management never rending quest for profits. The next 6 to 12 months will tell how customers react.