The Customer is Always Right

Im Wondering with still with alll this talk about fares whatever happened to the "supply and demand" way of pricing? Now that supply has been reduced by in some cases 20 to 30 percent, why hasnt fares gone way up. It should if we base that on evryday buisness that every company in this country conducts. Im curious to all the 99 dollar each way promoters whats you catch on the suply and demand therory? I think fares should be going wayyyyy up considering supply (ASM'S) has gone way down.If airlines were to conduct buisness as many on here seem to think an airline should do, are u willing to pay the price? Al be it i understand that theres too many fares but still its a supply and demand market. Emphasis on "FREE MARKET" If you dont want to buy something dont. Id you do then buy it. Its simple its easy its black and white.... Thats what i hear from alot of you.
 
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There is virtually no demand for $2000 tickets.

There is an oversupply of $99 heavily restricted tickets.

There's a disconnect between demand for something in the middle and the ability to recognize and meet that demand. If you ask to buy something in the middle you are strongly steered to the low end fares. If you try to redirect back to something more flexible you're steered to the $2,000 fares.
 
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On 2/5/2003 10:59:47 AM TomBascom wrote:

On 2/5/2003 8:46:08 AM X-U wrote:

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Tom and Bob

You both get on here and say what a great job the employees are doing, you fly U only because of the employyes.
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I didn't say "only". The employees are certainly a large part of what keeps me coming back. But they aren't the whole story.

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Then you turn around and say they need to bite the bullet on pay, benefits and pensions, otherwise U won't survive. Why? Because U's costs are higher than their revenues.
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Feel free to provide a citation. You're putting words in my mouth.

None the less -- costs must be reduced, if you're still disbelieving that I don't know what to say.

There are many ways to reduce costs. We've both been strong advocates of improving productivity through simplification -- especially in the area of fare rules and restrictions. That sort of approach does not necessarily imply a cut in pay or benefits. It does likely lead to lower staffing levels unless there is offsetting growth in travel.

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You say you don't want to pay a higher fare, thus the revenue side of the equation can't be raised leaving the only alternative to cut costs.
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You haven't been paying attention. While it's true that I don't especially "want" to pay any more than I have to (who does?) I have gone into quite a bit of detail about how I'm more than willing to pay the absolute lowest fare, would in fact welcome an opportunity to do so and do spend quite a lot of effort looking for alternative fares. Nor am I alone in that position.

Like most business travelers I'm willing to pay a reasonable fare for reasonable value. I think that the service that I want is worth more than $99. Management thinks it's worth $1,000. The market is telling management that they're wrong. Management's response is to lower the $99 fares to $89 and raise the $1,000 fares to $1,250. I suspect that I'd be pretty darned happy at around $250 (in this made up example...) and I really don't care if the lowest fare goes down to $29 or up to $200 because if there's a $250 option that brings the right value I'll buy that (assuming that someone can figure out how to offer it to me and let me buy it -- which is another thread...)

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But when the cost cutting hits you, you refuse to give anything, so it all gets dumped on the employees.
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This is also untrue. We have in fact taken substantial cuts in service.

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So who gets stuck with the bills? Don't come on here and say how much you appreciate the employees when you aren't willing to pay them for the work they do. "Attaboys" are great, and are surely appreciated, but they don't pay the mortgage and living expenses.
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It's a business not a charity.

Differentiating yourself by asking your customers to sacrifice will have very predictable results. Just as it does in any business. The "WalMart with higher prices and surly management" strategy has been tried. So far it hasn't stopped WalMart anywhere that I know of...
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You want a citation regarding your true appreciation of the service that employees provide to you, then you give a fine example in the very same message:"It's a business not a charity." That's true, and the employees are not volunteers. It will be quite interesting to watch this country as the middle class evaporates and there will be no consumers left to purchase much of anything, including whatever product or service you yourself provide. I'm afraid this discussion is going nowhere. Maybe when the service you say you value is eliminated from the entire industry, you will remark how you would be willing to pay more for better service.
The Golden Age of Airline travel, with gourmet meals for all passengers on every flight served on fine china and linen disappeared with deregulation. The "Silver Age" is coming to a close. You personally say you are willing to pay more, a middle ground between the sublime and the ridiculous, for a flight. Why don't the cockroaches make a public statement, USA Today, WSJ, CNN, Fox, advocating this idea?
 
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On 2/5/2003 8:55:56 AM X-U wrote:

skyflr69:

"A f/a at jetblue,Airtran, Spirit, SWA can evacuate an airplane just as well as one at U, delta, AMR etc.The FAA demands it."

That is a misconception. The FAA provides acceptable MINIMUMS in the performance of F/As, pilots, mechanics, dispatchers and any other safety personnel. The Major Airlines have always strived to go over and above those minimums.



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Not anymore. Major airlines are meeting the minimums. with 3 family/close friends at Jetblue, SWA, AMR it looks as if they are spending the same amount of time on safety.
Besides, the passenger doesn't care. minimums are fine for them. they want better SERVICE.
 
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You want a citation regarding your true appreciation of the service that employees provide to you, then you give a fine example in the very same message:"It's a business not a charity." That's true, and the employees are not volunteers.
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I'm not sure that I follow you. Are you saying that I don't (really) appreciate US Airways employees because I recognize that they work for a business that is trying to make money? You must know that a lot of burger flippers have trouble scraping together the cash for a decent house. Did you offer to pay $10 the last time you bought a BigMac?

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It will be quite interesting to watch this country as the middle class evaporates and there will be no consumers left to purchase much of anything, including whatever product or service you yourself provide. I'm afraid this discussion is going nowhere. Maybe when the service you say you value is eliminated from the entire industry, you will remark how you would be willing to pay more for better service.
The Golden Age of Airline travel, with gourmet meals for all passengers on every flight served on fine china and linen disappeared with deregulation. The "Silver Age" is coming to a close.
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I've been hearing this "americans are spoiled, the golden age is over, get used to less" mantra for at least 30 years. Today's world is, in general, a much better place to live. 30 years from now will surely be different. IMHO it'll be better, not worse.

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You personally say you are willing to pay more, a middle ground between the sublime and the ridiculous, for a flight. Why don't the cockroaches make a public statement, USA Today, WSJ, CNN, Fox, advocating this idea?
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I have. They didn't see fit to print it. My guess is that it doesn't fit the superficial view of the world (price is all that matters) that they've absorbed from management. Given some of the tripe that they do print that's hardly surprising.
 
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On 2/5/2003 4:25:01 PM X-U wrote:

Why don't the cockroaches make a public statement, USA Today, WSJ, CNN, Fox, advocating this idea?




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X-U, we're trying. Tom, Bob and the rest of us understand the points that you are making. Our talking points are extensive. However, to date we have not been as successful as we would like in elevating the discussion in the press.
 
bob, fare issues have been a hot button since the wright brothers. Fares are at an all time low. YES I SAID LOW! If you want a cheap fare shop around. If you want a low fare be flexable. Isnt it that simple man????????? Granted, certain restrictions can be modified and the structure can be tweeked. I think youll see some tweeking but they are here to stay. The options are work within the rules, stress out and have a heart attack, ride the bus... If all else fails, buy your own airline. :)
 
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Fliboi -- do you ever actually pay for a ticket? Flexibility and low fares are mutually exclusive. The only way to have a flexible schedule is to pay full fare. If you want a low fare you have to follow very specific restrictions and you are not allowed to vary from the terms in any substantive way. "Being flexible" is airline doublespeak for holding still while the straitjacket is adjusted.

Nor is it about the loss-leader low cost fares. Fares are not at an all time low. Management just snuck another big increase past everyone with this latest "sale". There are more fares, more rules and a wider spread between top and bottom than ever before -- expect traffic to continue to decline until that changes in a meaningful way.
 
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On 2/5/2003 6:16:41 PM AtlanticBeach wrote:

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On 2/5/2003 4:25:01 PM X-U wrote:

Why don't the cockroaches make a public statement, USA Today, WSJ, CNN, Fox, advocating this idea?




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X-U, we're trying. Tom, Bob and the rest of us understand the points that you are making. Our talking points are extensive. However, to date we have not been as successful as we would like in elevating the discussion in the press.


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Well I certainly understand the points that you all are making also. I have always thougfht it grossly unfair that there was(is) such a huge diparity in the walk-up fares versus the advance purchase. What if an airline had a special frequent-flyer only fare in the middle of the extremes that was eligible for miles? With the that the lowest available "leisure" fares did not qualify for miles?
 
Bob lets try to remain adults here and not insult.... I respect your OPINION i dont think you vomit it up!
 
Tom< I beg to differ. Fares are historically very low. All you have to do is look at fares over the past 20 years. Traffic is still strong. Airlines on average have reduced capacity by at least 20% across the board naturally it will be affected. Loads are still above 60 % in most cases. airlines are losing money because the Fares are cheaper and or buisness's are being more flex with travel plans. Fears of flying esp on short haul trips has also slammed the airline industry esp Usair who on the east coast has many short haul flights.In general since 9/11 with the reduction of flights, fares in general shouls have sky rocketed but because of special circumstances ie fear of flying, fares have remained low not to mention low fare carriers.
 
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On 2/6/2003 5:56:38 AM usfliboi wrote:

Tom< I beg to differ. Fares are historically very low. All you have to do is look at fares over the past 20 years. Traffic is still strong. Airlines on average have reduced capacity by at least 20% across the board naturally it will be affected. Loads are still above 60 % in most cases. airlines are losing money because the Fares are cheaper and or buisness's are being more flex with travel plans. Fears of flying esp on short haul trips has also slammed the airline industry esp Usair who on the east coast has many short haul flights.In general since 9/11 with the reduction of flights, fares in general shouls have sky rocketed but because of special circumstances ie fear of flying, fares have remained low not to mention low fare carriers.
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You're missing the point -- "fares are low" is a specious management deception that is intended to divert attention from the need to rationalize the structure of fares. It is just as true that fares are at an all time high as it is that they are at an all time low -- it only depends on which end of the spectrum you look at.

Management has their heads buried in the sand while they wait for business travelers to return to the days when they blindly purchased full fares. And they pretend that people buying so-called leisure fares are on vacation with their laptops rather than recognizing that they are business travelers who have rejected the idea of paying extortionary fares for the same seat.

In a sense management is right -- if it happens that business travelers revert to their old behavior all will be well and the good times will roll. It's not happening so they try to force the issue by adding ever more arcane and restrictive rules and restrictions. And so we "hate" them more and more and the cycle continues.

It isn't going to happen. Business travelers have figured it out. We aren't going back to the old days. Ever. There are plenty of precedents in numerous other industries. It isn't going to happen.

Our needs are not being met -- this steadfast insistence that price is everything and that customers must sacrifice all flexibility for price is leaving money on the table. There is a latent and unmet need for flexibility in travel plans coupled with business friendly services at a reasonable price.

SWA sold more full fares than ever last quarter. Imagine that. I wonder why?
 
Guys-

Hey, give US a chance. Even though I do have first hand experience with institutional resistance to change, I really can't believe that management is so stupid as to hold on to the 'anti-value' pricing model that has been very convincingly described here. (admittedly, you guys are just arguing for what you want, just like any other interest group, it's just that you happen to be right.)

I suspect that US doesn't feel like it can make many moves regarding pricing, since DL, NW and CO are seemingly willing to go to great extremes to try to get US to liquidate. (I suspect that this defiance of DOT in regards to the tripartite axis is in part trying to keep U from emerging)

Surely, U will move toward 'more-value' pricing after emergence. In the past, airlines have been persecuted by the competition and U doesn't have the cash to survive an onslaught.

By the way, if I were starting an airline I would not offer employees a space-available travel benefit (I'd take a lesson from Henry Ford and price my product so that my employees could afford SOME consumption of it.) and I'd even make company business units pay for their own travel.

While on this subject, I'd never, ever have more than 1 aircraft type and I'd try to get the unions to break from seniority... and I'd make flight attendents security officers... ... but I guess that's another thread.
 
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On 2/6/2003 9:27:17 AM RowUnderDCA wrote:
By the way, if I were starting an airline I would not offer employees a space-available travel benefit (I'd take a lesson from Henry Ford and price my product so that my employees could afford SOME consumption of it.) and I'd even make company business units pay for their own travel.

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I'm curious why you say that. I can think of many possible reasons, but just wondered what makes an "insider" feel that way.
 
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Atlantic Beach wrote:

X-U, we're trying. Tom, Bob and the rest of us understand the points that you are making. Our talking points are extensive. However, to date we have not been as successful as we would like in elevating the discussion in the press.

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You've argued intelligently, too bad they just don't get it, either here or elsewhere. I just happened to be checking fares from BOS to SFO. Lowest coach fare was $298, lowest unrestricted COACH fare was $2518. That makes soooo much sense!
 
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