While most U.S. airlines have learned to be relatively honest with their best customers, many of their foreign peers have not yet realized that travelers are not as stupid as to fall for their PR spin and questionable practices.
It’s time for those carriers to wake up to the fact that it’s the end of 2011, and much in the airline industry is rather transparent to those of us who pay attention. Trying to persuade customers that bad news is actually good may be an essential PR trick, but in today’s hyper-connected world, it’s not hard to figure out someone’s true intentions.
Among the airlines still using the old playbook is British Airways, which is surprising for such a major and quite good global carrier. Last month, it drastically devalued its award redemption chart, but it tried to present that negative change as a positive one.
The clue came with the usage of the world “revitalizing” to describe the changes to the carrier’s frequent-flier program, Executive Club. At least they steered clear of “enhancement,” which is what many U.S. carriers used in the past, inviting much derision from frequent fliers.
British Airways announced a few weeks before the changes took effect that they were coming, but what those changes actually were going to be remained a secret until the very day they were implemented. That move showed gross disrespect for the company’s best customers who deserved much better for their loyalty.
In contrast, many U.S. airlines and hotel companies publish their new charts, as well as other program changes, months in advance. One recent exception was Delta Airlines, which didn’t really have an official global chart for more than a year, until it finally published one in February, effective immediately — actually, much of it was already in use unofficially.
Apparently, British Airways was afraid that many Executive Club members would rush to burn their miles before the last change — after all, there were plenty of miles on its books, partly thanks to its giving away 100,000 miles as a credit-card sign-up bonus. So it said that the number of award miles required for “97 percent of our routes” will stay the same or even go down.
In fact, that turned out to be false. In an attempt to save face when the new chart came out, the airline said it had meant 97 percent of the nonstop routes out of London.
While some of those nonstop routes have indeed become cheaper, there are many Executive Club members outside London who earned their miles hoping to use them for trips to cities other than London. Unfortunately, they are the big losers — the increases in those cases can be over 80 percent. Substantial premiums have been added to connecting and partner flights across the board.
Those changes, along with the huge amounts British Airways charges in taxes and fees on award tickets, have drastically devalued its miles. Just this week, I booked award tickets to Asia for two clients, and I really wanted to help them burn their British Airways miles. However, that particular award had almost doubled in price, and the taxes were over $1,200 per person. So I booked with another airline for nearly half the miles and $85 in taxes.
British Airways in certainly not alone in thinking that customers are stupid. Air Canada quietly started charging fuel surcharges on some partner award tickets earlier this fall. Did it hope no one would notice that they were asked to pay hundreds of dollars more than before? Finally, after Air Canada was exposed on various blogs, it admitted what it was doing and said that even more partner flights would be included in the new program.
And then there is the scandalous behavior of the United Arab Emirates’ Etihad Airways last month.
For two days in October, it advertised a First Class fare from Spain to Australia on its website for less than 400 euro. According to Spanish media reports, about 300 people bought tickets. The first of them traveled 10 days later, when an agent in Brussels noticed the fare and alerted the appropriate department. It was then determined that the fare was a mistake, and the passenger was downgraded to coach without any compensation. The rest of the tickets were canceled.
I’ve written about mistake fares before, but the issue here is not whether Etihad was wrong not to honor the tickets. I said scandalous because of a letter the airline sent to the passengers who decided to put up a fight and wanted to defend their rights through the media.
Etihad hired a law firm in Spain that in no uncertain terms threatened those customers in writing with litigation, if they dared to go to the media. The last time I checked, Spain was a democracy with freedom of speech, and the United Arab Emirates was something quite different. I don’t believe anything has changed since.
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Continue reading about Airlines still think customers are stupid
When was the last time you used a travel agent? I asked that question in my book “Decoding Air Travel.” Last month, President Obama asked it, too, and the American Society of Travel Agents speedily protested. So let’s examine the modern — or perhaps not modern enough — travel-agency system and the value it brings.
Many young people don’t even remember the time when using a travel agent was the only practical way to book a trip. While many consumers today book their own travel, using travel agencies is still quite prevalent in the corporate world.
However, many business travelers I know are unhappy with their company’s travel agency. It’s clear the current system isn’t working well anymore for a variety of reasons. Without taking sides, let’s look at those reasons from the perspective of travel agencies and their customers.
If you are a traveler — for work or pleasure — you probably have at least one of the following problems with travel agents:
• They don’t always offer you the lowest fares or best itineraries;
• They only book tickets and leave the rest to you;
• They know little, if anything, about frequent-flier programs, elite status, miles and upgrades;
• They are not familiar with on-board products and don’t know which airlines have flat beds in Business Class;
• They don’t travel frequently, if at all, but sit in an office and rely on computers to tell them what to do;
• They are inflexible when schedule changes affect your tickets;
• They don’t take care of all your travel needs.
As the air travel system has become more complex and customer-unfriendly in recent years, the needs of the modern traveler have grown and diversified enormously. The traditional travel agency model has so far survived the Internet threat, but its relevance has diminished significantly, because it hasn’t caught up with the changes in travelers’ needs and demands.
Booking a ticket is no longer even close to enough. You have to be able to compare fares and products of different airlines and alliances, and to offer your customers the options that provide the best combination of price, comfort, convenience, maximizing frequent-flier miles, progress toward elite status, best upgrade opportunities and the most effective use of elite benefits.
For this to happen, you need a wealth of knowledge, which most travel agents don’t have. For example, you need to know what booking classes are eligible for upgrades and which don’t earn miles. It’s certainly unreasonable to expect one person to be familiar with each airline’s requirements, but there are ways to deal with that — an agency can have employees or teams specializing in the different alliances or groups of carriers.
Probably the two most important and consequential weaknesses of the agency model are its use of limited data and booking sources — often just one Global Distribution System (GDS) — and its almost exclusive reliance on automated systems to do all the work.
If you’ve read my book, you already know more than the average travel agent — and you realize why those two weaknesses result in millions of customers paying much more than they could be. Automation is no doubt vital for the travel-booking process, but given the intricacies of airfares and the tricks airlines have adopted to “maximize revenues,” sometimes we need to rely more on our brains than on machines.
One other thing to keep in mind when dealing with a travel agency is whether it has contracts with specific airlines. Airline commissions were discontinued years ago, but large agencies still have contracts. How does that affect you? The purpose of those contracts, of course, is to encourage agencies to send more business to the respective carrier. If your agency receives its biggest commission from American Airlines, it might book you on American even if Delta has a lower fare.
Now let’s look at the above-described picture from a travel agency’s perspective. Most agencies don’t have the pull of American Express and Carlson Wagonlit, and they don’t receive airline commissions. They do get GDS kickbacks, as well as transaction fees for provided services directly from clients — about $35 on average, though some charge as much as $90.
For what you pay them, they have decided that it’s not worth more than several minutes of an agent’s time to work on booking you a ticket. Then how do you expect them to do more than letting the computer do all the work? Would you pay them more to take care of your upgrade and other needs? I suppose it depends on whether you trust that agent to do a good job. There is no point in paying for something that you later have to fix yourself.
So what’s the solution? Should everyone stop using travel agencies? Of course not — they do have a place in the travel industry. Many companies simply can’t handle their travel volume without outside professional help. At the same time, the gap between agency services and travelers’ needs keeps widening.
One solution could be for agencies to have teams dedicated to high-end, high-demand executives, who are willing to pay more for additional services. Some large agencies already have such teams, but their tasks usually don’t include creative ways to save on airfare or any of the frequent-flier services described above.
There is another solution, which was suggested to me by — ironically — travel agency owners last year. They shared my observation about the gap between what they do and what their clients want, and urged me to bridge it. How? First, by educating their clients in seminars and private training how to do for themselves what the agencies don’t offer. Clients who don’t have the time or patience to learn can ask me to provide those additional services to them.
So to bridge that gap, I started my company, Kralev International LLC. As one of my clients says, we can do your homework if you don’t have time to do it yourself.
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My new book, “Decoding Air Travel: A Guide to Saving on Airfare and Flying in Luxury,” which aims to help travelers master the increasingly complex and frustrating airline system and to work it to their advantage, has just been published.
The premiere is scheduled for June 29 in Washington, and my book tour begins on July 7. Some of the cities I’ll visit are Santa Fe, NM, Los Angeles, Minneapolis, New York, Salt Lake City, Phoenix, Manchester, NH, Fargo, ND, Charlotte, NC, Portland, OR, San Francisco, San Diego, Hong Kong, Singapore and Sydney.
An updated list, as well a sneak peek at the book’s content, reader comments and other educational materials, can be found on DecodingAirTravel.com, where you can also purchase a copy with a 20 percent discount. Of course, you can also buy it on Amazon, which offers free standard shipping.
“Decoding Air Travel” is the most comprehensive and insightful work to date on the intricacies of the modern air travel system from a customer perspective, and the most effective tool for making travel more affordable, convenient, comfortable and fun. It has two goals: Improving readers’ travel lives and saving them lots of money. It seeks to achieve those goals by helping them become knowledgeable, empowered and sophisticated travelers.
We are all stakeholders in the air travel system — airlines, travelers and government authorities. A more effective and less frustrating system than the one we have today would benefit us all.
Why do I care about this so much? Because I want more people to travel and see the world. I spent the last decade being around diplomats and writing about them almost every day as a newspaper correspondent. Although different countries’ national interests are the main drivers of international relations, the underlying mission of diplomacy is to make the world a better place. One way to do that is to give more ordinary people — not just diplomats — the opportunity to travel to other countries, experience different cultures and try to understand points of view they may not agree with.
Most people cite two main reasons for not traveling abroad: It’s too expensive and too much of a hassle. If only there were ways to eliminate those barriers. As it happens, there are such ways — that’s what this book is all about.
Part I, “Building Your Own Airfare,” explains in detail the fundamentals of fares and flight inventory and offers a highly effective booking process called The Kralev Method. Part II, “Creating a Seamless Journey,” will help you turn your flying into a pleasant and hassle-free experience by deftly handling any problem that may arise, including delays and cancellations. Part III, “Mastering the Frequent-Flier Game,” reveals the secrets of a modern global traveler who benefits from elite airline status, upgrades, award tickets and much more.
If you take at least two plane trips a year, this book will improve your travel life enormously.
Flying Blue, the frequent-flier program of Air France/KLM, has banned customer service agents from revealing the codes the airlines use when booking awards or upgrades. If you ask them, they will tell you it’s none of your business. Is this misplaced paranoia or do carriers have the right to keep that information secret?
For smart and sophisticated travelers, the importance of having access to raw airline data cannot be overstated. Benefiting from that access has changed my travel life — it has ensured that I always pay the lowest possible fares and fly in comfort and luxury at the same time. Booking codes, of course, use letters of the alphabet.
Earlier this month, I needed to verify the codes Air France and KLM use for awards and upgrades for my upcoming book, because Flying Blue is making some changes beginning June 1. So I called the Flying Blue North American call center outside Toronto. An agent called Henry Esteban refused to share the information, saying he and his colleagues had specifically been forbidden by management to do so.
I’d never heard such a response to the same question I’d asked so many times before at other airlines, so I requested to speak with a supervisor. Esteban resisted repeatedly, which also surprised me given my Platinum elite status, but eventually he put me through.
The supervisor, Roberto Quote, was just as vehement in his refusal to discuss booking codes. He insisted that was private company information and customers had no right to know it. If you wonder why I didn’t turn to Air France reservations agents, that was actually my first call — but they said they knew nothing about awards and upgrades and referred me to Flying Blue.
In 2009, I wrote about the challenges to airlines presented by the transparency of their data on the Internet. I also wrote specifically about the public availability of award data, which some carriers wanted to control. However, simply identifying the codes used for awards and upgrades has never been an issue — until now.
Although no carrier is legally required to disclose those codes publicly, I have a hard time understanding Flying Blue’s thinking. Does its management really believe that kind of information can be kept secret in 2011, with all the blogs out there and websites like FlyerTalk.com and Milepoint.com?
It may be time for the program to focus on more meaningful and useful subjects in the training of its customer service agents.
Continue reading about Should airline booking codes be secret?
Delta Airlines has cemented its status as the network U.S. carrier with the worst frequent-flier program, further devaluing its long-cheapened SkyMiles. The leadership of the program or the airline — or perhaps both — doesn’t seem to understand what the loyalty business in 2011 is about. It may be time for a new team at the top.
For more than a year, Delta failed to publish an award redemption chart for most of the world, resulting in lack of transparency about how many miles were really needed for an award ticket.
When it finally unveiled a chart this week, the mileage rates on many routes were increased significantly. Many loyal SkyMiles members felt cheated and disrespected, calling Delta’s move a “stunt” in comments posted on FlyerTalk, the largest online travel community.
If you wondered why Delta announced last week the elimination of miles’ expiration, my guess is that it tried to soften the blow of what was coming — and to claim that it cares about its customers. In reality, almost everything SkyMiles has done in recent years has been decidedly customer-unfriendly. I’m not an active SkyMiles member and have no dog in this flight, but I’ve been appalled enough to write about it.
In comparison to its two largest competitors, American and United, Delta’s upgrade and award policies are the most restrictive and inflexible. Its system-wide upgrade certificates are only valid on tickets booked in Y, B and M class, and are not transferable. American’s upgrades can be used on just about any fare and gifted to other people. United’s certificates exclude only the lowest booking classes and can also be transferred.
In 2008, Delta devalued its miles by adding a third award tier, in an attempt to mask its very poor award availability at the lowest level. A year later, it devalued its elite status when it introduced a fourth tier, Diamond, on top of Silver, Gold and Platinum. If that’s not bad enough, Delta also charges some fees that are hard to justify, such as $50 for booking an award originating outside the United States.
The main reason frequent-flier programs exist is not to make customers happy, but to make money — and most of them do. I’ve never considered that a problem. A successful business deserves all the rewards it can get. My problem has been with the way airlines have been trying to make money through their so-called loyalty businesses. For decades, they have had an utterly peculiar philosophy, which can be best described at a “screw the customer” approach, which I explain with a misguided view of what the loyalty business is about.
Fortunately, a few airline executives recently saw the light, and things are starting to change. I’ve written several times about what Graham Atkinson did when he was president of United Mileage Plus for less than two years, beginning in the fall of 2008. He understood the essence of customer loyalty and showed that what’s good for the company doesn’t necessarily have to be bad for customers. While he wasn’t able to end StarNet blocking, he actually listened to customers and reversed decisions based on their feedback.
American’s AAdvantage program also has progressive leadership that rewards top fliers appropriately and has tried to make it easier for members to use their miles. There is still a lot to be desired, but it’s on the right track.
Delta, on the other hand, has been stuck in the 20th century. It seems it’s working hard to perfect the “screw the customer” approach.
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