01-11-2011
02:33 PM
2 Loves
I echo what many have said above. This change sounds like “New Coke” and will be a case study in the future. I read the Dallasnews.com article which indicated that despite carrying more passengers than AA the FF membership was about half. That is not a problem.…that’s like yogi Berra saying “no one goes there cause it is too crowded”. You have loyalty, even from non-loyalty members.
Why would you alienate the people who choose your airline over another to increase membership? Why would making the rewards program less attractive increase membership? If you have more passengers, but they don’t cost you money in rewards, that’s a win.
I understand you want to increase margins, by getting people to pay more and get less rewards…just state that. The idea that every seat is a rewards seat, is not attractive when that reward seat will cost me at least 10 roundtrips, in most cases far more depending on distance traveled and lead time to buy.
My typical scenario is taking $99 flights to visit family in Florida, then getting a reward ticket to Vegas. Since Flights to Vegas are often close to double what I pay to goto FL. It will take me 20 Round trip flights to earn a “reward” ticket. I could fly a competitor approx 12 times at about 1,000 miles per flight and earn that same ticket. The 10 SWA flights I don’t have to take, more than pay for my baggage, and I have the opportunity to find deals other than just at Southwest.com
Yes, I need to plan ahead to get that reward seat, but if I don’t plan ahead under the new RR plan, I could be paying even more for my reward seat..thus needing somewhere between 20-30 roundtrips to earn my vegas trip. Thank goodness they don’t expire (sarcasm)
My experience, I believe is typical. (just look a this feedback), and yes your margin will increase in that I would pay more for that reward ticket…but if I DON’T take those 10 flights on SWA…you will be like AA- where they carry less people, despite more having more members.
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