News and notes from around the interweb:
- Discounted Avianca Lifemiles redemptions from 10,000 miles each way
- Prominent travel blogger Nomadic Matt is breaking up with American Airlines. And he makes pretty clear it is them, and not him.
- The kid who figured out how to trick Indian airline reservation systems to sell him flights for a single rupee
Air India Boeing 787 - US credit card balances are now up over $1 trillion but that may be manageable as long as unemployment stays low. (HT: Alan H.) If the economy turns, of course…
- FAA rule requiring you to register your drone has been overturned
- Atlantis Resort claims not to be worried about the opening of Baha Mar, that the new resort will grow the pie of tourists to Bahamas and that will rebound to their benefit. While that affect may indeed exist, huge growth in upscale room supply surely won’t benefit them in the short run.
- “Mixed Reality Air Travel May Augment the Flight Attendants of the Future” (HT: Alan H.)
$1 Trillion on credit cards is nothing. That is way short of the student loan debt.
Agree. $1T on CCs is not a bad story or new story. The Journal reported it a while back, and it is not a negative thing. It means people are willing to spend again.
Could people get caught with their pants down at some point in the future? Sure, that is why CCs charge such high interest rates.
Now, that AA breakup story, that is the one to read.
I think it’s a win-win for Nomadic Matt and AA to part company. Nomadic Matt benefits by being a free agent, and AA doesn’t really care if it loses his low revenue tickets. It’s bad business to lavish lots of perks on customers who aren’t particularly profitable.
“redound” is the word, not “rebound”
@iahphx. Agreed. American Airlines is a rich airline, awash in profits and they do not need me to fly them. I am planning to fly elsewhere, but I am sure they will not miss my revenue. There are plenty of rich people, stupid corporate travel, and brainless Ma and Pa Kettles to take my place.
@iahphx
They will care if they lose all of their low-revenue ticket holders.
I will agree with your last point, I never understood why they rewarded behavior solely based on mileage flown.
But Gary has many times over the years made the point that it’s “the margin” that counts. “Low revenue” flyers may be considered as such by the airline, but often, status locks people in to an airline, incentivizing them to pay more for their preferred carrier. That extra money is pure profit, and by discouraging that behavior, the airlines will feel it in their pocket book.
I’ll admit what drives me nuts is that actual flying earns so little miles these days. I do next to no domestic flying, and use credit card miles for my big trips. There was a time when status and RDM had me buying *a lot* of discretionary trips, albeit at low fares. Now? Nobody gets that money.
Though Matt’s analysis was very solid:
“And thus the current dilemma: If you are a low-spending but still frequent traveler, does it make sense to stay loyal to an airline in this day and age?
“The answer, I’ve come to realize, is a resounding NO.
“As someone who likes the concept and perks of loyalty, it saddens me to say this, but unless you are spending a lot of money on one airline, loyalty — at least to airlines — is an antiquated concept.”
My guess is that I’ll be breaking up with AA this year as well.
Regarding the entitlement-hurt posted by Nomadic Matt – I agree with those who say Matt should stop whining. But I also agree with Matt. The logical extension of his behavior would be that if he somehow managed to get on flights for free for several years then was discovered and made to pay a modest price for future flights, he would be just as pissed. Sorry, a business needs to survive, and that’s by generating a revenue stream for themselves. OTH, what AA has done to the availability of awards, legitimately earned, is indeed a big FU to their loyal customers
@madguy — I agree with you that it’s not a good business practice to make standard award inventory scarce. It feels slimy and deceptive. The gatekeeping function should be in the difficulty in EARNING the miles. It is good business practice to make it harder to earn miles and status on cheapo fares. But once you have the miles, you should be able to reasonably spend them. Kind of like the way the hotel programs are run: how much worse would those programs be if they had airline-like capacity controls?
I know everyone wants to feel they are a valuable customer, but the reality is that if most of your flights are on deeply-discounted coach fares, you’re probably a far less valuable customer than you think. If Nomadic Matt knows what he’s doing (and I assume he does), he probably generates little to no profit for AA. Just like I am certain I generate little or no profit for them. Discretionary travelers who know how to game the system are just not “desirable” customers.