How can airlines run their business like this?

Tom Dougherty, CEO – Stealing Share

15 February 2010

Airlines play shell games – a case study

There is an institutional problem with the airlines. It is called slight of hand and deception. Anyone who has ever had to pay for baggage or an extra three inches of legroom, or handed over $7 for a Budweiser knows exactly what I mean.

If you are an occasional flyer, someone who struggles with seating area 4, constantly worrying that your roller board will have to be checked as you make your way to your middle seat in the “back of the bus,” don’t think those seated in first class are treated like entitled and spoiled children. Trust me, the airline does not care about the frequent traveler either. “Just sit back, relax and enjoy your flight”, as intoned by the pilot, sounds as rehearsed and insincere to the road warrior too.

I am a road warrior. I have booked over a million miles in the past years with United Airlines. Believe me, it is not a badge of honor as much as it is an acknowledgement of repeated inconvenience, poor service, and time lost.

My status is what United refers to as a “1K” flyer. As a result of that status, I get to enter the same dirty and worn aircraft as you do, except I get the honor of walking on a 4’ x 2’ red carpet two minutes before you.

One of the perks that United provides its 1K members complimentary upgrades. After spending the better part of my life flying everywhere, United electronically deposits six system-wide upgrades in my account each year. If I don’t use them, they expire 12 months after they are deposited. These upgrades entitle me to a point-to-point upgrade of one class of service anywhere in the world that United flies — or so I thought.

Later this week, I am off to London on business and I thought it would be a plus to upgrade my seats from economy to business class. The business class promise is a wider seat that reclines flat, better food, and free drinks. But the real value to me is an electric outlet for my laptop that allows me to be productive on the transatlantic trek. (Isn’t it amazing that electricity for our computers is not standard throughout the entire airline?)

When I went to the United website to request an upgrade, the dialog box informed me that my flight was not upgrade eligible. I decided to call customer service to better understand why.

The rep on the phone informed me, in the alphabet soup language of airlines, that my ticket fare (which was $950) was a “Q” fare and, as such, was too cheap to be upgrade eligible.

This was news to me. It was news that any fare was not upgradable. It was also news to me that $950 was considered a bargain fare. When did that happen? I asked to speak to the manager.

A terrific customer service manager named Ron tried his best to help me. His professionalism was exemplary as he listened to my complaints and treated me with great courtesy and dignity. My options however astounded me. It seems that  I could pay an additional $500 to “make my ticket upgrade eligible,” but could not use my “system wide upgrade.” Instead, I would have to buy the upgrade with 20,000 of my frequent flyer miles.

Of course, even Ron did not understand this until he spent 45 minutes on the phone with me trying to understand all of the fine print and exceptions that make up the average airline transaction. I was supposed to understand all the ins and outs when I originally purchased my ticket on the United website as is my custom even though Ron, the customer service manager, could not explain to me all the intricacies of the upgrade program without the help of research and a teleprompter.

In an effort to better help me understand it in the future, Ron suggested that, before I “click” the purchase button, I should call the 1K help desk to make sure the ticket I am about to purchase is upgradable. Yeah, that sounds easy and convenient.

Here is what I know for sure. United wants me to believe they value my business and they want me to believe that by rewarding me with upgrades they really do not want me to use.  These are not free upgrades; they simply are premiums that I can use only when I seek out a more expensive fare.

In his endeavor to help me, Ron discovered that, when I originally bought my ticket, I could have purchased a ticket that was upgradable for $200 more. He then waived the rebooking fees, charged me the extra $200 and upgraded my seats.

If I ran my business this way, I would not have a business. Maybe that is why the airlines don’t have a business either. I define having a business as delivering a product or service that allows a business to be profitable. To be profitable, you must deliver to your customers what you promise and make it as easy as possible for them to do business with you. United Airlines obviously thinks complexity, exceptions, and fine print are a fine way of doing business. They don’t think any of this is a problem.

If you hope customers choose you and have loyalty to you, you had better have loyalty to them. The transatlantic flight that I am booked on had available seats in business class, but United would rather fly with those seats empty than allow a million-mile flyer upgrade to them.

I am looking to upgrade airlines. Anyone have any suggestions? I did not think so.


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