Delta leads US network industry with Skymiles overhaul

[WorldTraveler]

http://finance.yahoo.com/news/delta-introduces-2015-skymiles-program-095700737.html

ATLANTA, Feb. 26, 2014 /PRNewswire/ -- Delta Air Lines (DAL) has taken another step in its ongoing commitment to improve the travel experience by unveiling changes to the SkyMiles program. The 2015 SkyMiles program will introduce a shift from today's current model in which customers earn redeemable mileage based on distance traveled to one based on ticket price. The program updates will be effective Jan. 1, 2015 and will also include a new mileage redemption structure that will improve Award seat availability at the lowest mileage requirement levels, offer One-Way Awards at half the price of round-trip, provide additional Miles + Cash Award options, as well as make significant improvements to delta.com and Delta reservations Award shopping tools.

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this is the most radical overhaul of US legacy carrier mileage programs since they were introduced and shifts the focus to rewarding based on revenue instead of miles flown.

Many global airlines operate their frequent flyer programs based on this philosophy that focuses on providing incentives the top revenue producing flyers to fly with DL, esp. at the last minute.


This also demonstrates DL's leadership in obtaining a revenue premium from its passengers even under the current system but one that will very likely expand dramatically under the new system.

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http://finance.fortune.cnn.com/2014/02/26/delta-skymiles-frequent-flier/?source=yahoo_quote

For that customer who flies twice a year from New York to Los Angeles on a $650 fare, reserved months in advance, it's a downer. Today, he or she would book 5,000 miles. Under the new program, the credit is just 3,250 miles, or the $650 fare multiplied by five.
By contrast, the top elites will reap a big windfall. Say you're a Delta Platinum member, and on Monday your mercurial boss suddenly orders, "Get to that conference in London on Thursday." So you book a flight from JFK to Heathrow in business class for $5,000. Today, you'd get a credit of over 20,000 miles, the round-trip distance across the Atlantic (plus a bonus for being a Platinum member). In the new SkyMiles regime, you'd receive nine times your fare in miles. That's 45,000 miles, more than double what you'd receive today on Delta or any other U.S. major.

In recent years, Delta has developed a reputation for going first, and making it worknotably by orchestrating the first big merger among the majors with its purchase of Northwest. Delta's out front again on this one. The old question may apply: If it's such a great idea, why didn't another major do it years ago?
Maybe Delta has the right answer: Serving its best customers

 

[700UW]

Funny the article you posted shows this:
 

Delta isn't the first airline to de-couple reward dollars spent vs. miles flown. The pioneer was Virgin America, which offered a similar program about eight years ago, followed by JetBlue (JBLU). And Southwest (LUV) made the switch 18 months ago.
 

 

[737823]

Funny the article you posted shows this:

Guess you didn't read the entire article now did you? Can you not read and comprehend?
 
 

Move continues Delta's innovative business approach: becomes first U.S. global carrier to transition its frequent flyer program to one based on ticket price starting Jan. 1, 2015

Josh

 

[700UW]

http://1.bp.blogspot.com/-eJ_9ZWRlOd8/TWEvX_8PLGI/AAAAAAAAINs/cNRo9eoKjG0/s1600/****+stirrer.jpg

 

[yoyodyne]

http://1.bp.blogspot.com/-eJ_9ZWRlOd8/TWEvX_8PLGI/AAAAAAAAINs/cNRo9eoKjG0/s1600/****+stirrer.jpg

 
 
What an intelligent reply!!
 
Bravo!!

 

[700UW]

Just dumbing it down to your level.

 

[WorldTraveler]

700 obviously doesn't know what a network airline is. or a legacy airline. or knows how to read. Or he likes to argue.

or all of the above.

It's right in the title of the thread and then I repeated with the use of "legacy airline" in the post.

Virgin America is neither. Nor is Southwest or JetBlue

Since DL dipped their toes into a revenue based Skymiles program which is in effect now, they obviously have a pretty good idea of what to expect with this change.

Obviously they believe it will be revenue positive or they wouldn't be doing it.

 

[eolesen]

What exactly is the "network industry"???? When I hear that, I think of AT&T, Sprint, Verizon, Cisco, LinkedIn... just about everything except airlines.

Rather than make up things, you should have just stuck with with what DL CorpComm came up with -- first U.S. global carrier to make these changes.

It's hardly unexpected, either. DL's been inching this direction for a while, and some of the hotel programs have already been structured this way. Whether or not it works to retain corporate customers is yet to be seen.

The reduced credit for partner-ticketed and flown itineraries is an issue for some corporate buyers, and this perpetuates that. The guys already shackled to the program will remain shackled (hardly unexpected), but I have to question what this does for the mid-range buyers whose clients have been getting elite status under the old rules, but will fall out under the new structure.

It's a bold change, but it's bad form to over-celebrate in the end-zone on the first play of the game. Unless, of course, you're the Seahawks or Packers.

 

[WorldTraveler]

except that DL has a solid track record for initiating change in the industry and getting it right.

we can use the term global US airline... again, B6, WN, and VX aren't any of the above.

DL knows its customer base and has clearly researched the issue long enough to make sure that they make sure the ones who they need to win actually do and are not penalized.

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

DL does nothing without considering the competitive impact.

 

[does this plane go to paris]

"Rather than make up things"
 
A few weeks ago he made up the term LFC on another board.  I'm sure that he wanted to write about LCC but he wouldn't admit that he made a mistake and insisted that LFC is common termonology for Low Fare Carrier, instead of Low Cost Carrier.
 
 According to the the internet the most common abbreviation for LFC is either  Liverpool Football Club, Land Forces of Canada or the stock symbol for China Life Insurance Company.  No where except in the WT's Delta centered world where he and Delta make no mistakes can he make up anything he wants.
 
I wonder how much research Delta did when they created "Song" in response to WN.  I'm sure they did their due dillengence on that issue and that added to their solid track record for what, 3 years?

 

[WorldTraveler]

you can find all kinds of abbreviations... no one said that LFC or legacy or network are the most common designations.

And personally I don't like the term "legacy" because it sounds like a dinosaur but it does have a meaning.

Yes, you can find plenty of mistakes that DL has made but there is a very clear line between what DL did before BK and what they have done since emerging. There are precious few strategic errors on their resume since 2007.

If they fail on this, it will cost them dearly. This is the equivalent of messing with Social Security.

Given that DL is pulling down significant revenue premiums to the industry and clearly has a strong customer-sales force relationship, it is highly doubtful that there is much that will take place that they didn't expect.

And again the real question is what the impact will be on other carriers, including the low fare/low cost carriers who have had similar programs and who might have had an advantage for some types of fliers compared to the legacy/network/global US airlines.

 

[eolesen]

Still hung up on winning, eh?

You might want to consider that all winning streaks eventually come to an end.

 

[robbedagain]

except wt the program says it is to begin jan 2015

 

[WorldTraveler]

yes, robbed, since tickets for travel in 2015 are on sale now and DL is saying the rules apply based on travel date, DL has to make the announcement now.

And, yes, a business is about competition which necessarily means some win and some lose.

Good companies, organizations, and individuals figure out how to adapt to the changing environment regardless of the environment around it. Change happens continually and has to.

You do realize that Delta means "change?"

The reason why DL is once again leading another change in the industry is because DL has figured out how to adapt and win where others don't.

Maybe DL will fail but the chances are that once again DL's success will come at the expense of someone else.

That's the way business works.

 

[Glenn Quagmire]

You just posted in the other thread that Delta cannot plan financially because of Obamacare?