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Frequent flyer programs revamped to drive profits in tough times for airlines


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UAL and Thai doubled the number of miles to redeem a free tickets and reduced the inventory of such seats. So the frequent business/first class flyers whom the airlines are more and more dependent on are now leaving in droves, not only because of an upgrade seat before at 90,000 one way is now 190,000 (depends on the carrier/route) but the carriers are instituting a spend minimum and a segment minimum. Some Star carriers are doubling the price for half the size seat. And NRT-LAx has been sold by an American carrier for 5,000plus, for a 2-4 2, while a island country with double the size seats (1-2-1 layout in business!) sold for about $2,300. Same day, same route, same class.

Some airlines stopped flying profitable routes and gave them to their alliance partners, who do not offer as many miles for the same class ticket. So the high-end customer whom Thai or UA or Delta or any legacy carrier needs now had to accept another airline for the flight, owes the count of that segment, loses miles, and generally gets no pre-seating, etc. So high end members, as they have been doing with MP, will thrash or dump miles, search for the cheapest flight and forget about loyalty, as the airlines have clearly shown how they feel about loyal customers.

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Kinda hard to be "loyal" to an airline when they reduce seat availability and hike award levels. Indeed, that's a good tactic to create "customer disloyalty."

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"Beset by low air fares and relentless competition, airlines around the world are waking up to the value of their frequent flyer programs and realising they can boost profits as well as brand profile."

I do not understand this - all the airlines have done for the past several years is raise prices and add on more surcharges while cutting flights. What year was this supposed to have been researched?

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