Travel Weekly Digital Edition

opinion
United’s loyalty ploy

I
t has been my experience that if I’m in a loyalty program with an
airline and it screws up, it may offer me some miles, in addition to
an apology, as a gesture of goodwill.
But United Airlines is breaking new ground by offering miles up
front to loyal passengers as an incentive to let the airline potentially
abuse its relationship with them.
United recently sent some members of its Mileage Plus program an
e-mail with the s u bject line “United welcomes you back with bonus
miles.”

“Your next United flight could be worth 2,000 bonus miles,” the text reads.

“Simply take advantage of this special opportunity, and — in addition to the miles you automatically earn as a Mileage Plus member — you’ll also earn 2,000 bonus miles the next time you fly United.”

Notice the language: “bonus miles … take advantage … special opportunity.” Reading this, a Mileage Plus member might assume they are about to get a little reward for flying

United.

Yes, advantage is about to be taken, and, for United at least, this is a special opportunity indeed.

A look at the results yielded by this promotion demonstrates that a loyal Mileage Plus member who purchases using the promotion code MPGT27 is very likely to pay more — sometimes more than twice as much, in fact — than a first-time flyer who simply books the same flights without the bonus miles through a travel agent, online agency or even United.com.

Going from Chicago to New York? Book on United.com and you’ll pay $208.80. But enter the promotion code, and the same flights on the same days are displayed at $448.80.

Denver to Seattle? You could pay $328.80. Or if you want to take advantage of this special opportunity, you can pay $484.80.

San Francisco to Austin? Your 2,000 bonus miles will only cost you $153 extra ($495.20 vs. $342.20)

In a search of dozens of flight pairs, comparing promotional rates with other United rates for the same flights, Travel Weekly’s editorial assistant, Theresa Bednarczyk, found only one set of flights where the fare

was exactly same, on the Los Angeles-Or-lando route. None was lower.

Could this be a result of timing, of fare movement due to normal yield management fluctuations? I don’t think so. Bednarczyk tested the promotion over the course of three days. Fares rose during this time period, but whenever the fare increased on United.com without the promotion code, it also went up proportionately with the promotion code.

In essence, Mileage Plus members who purchase using the promotion code are, in most

instances, buying miles, but perhaps at a premium. Without purchasing a ticket, any Mileage Plus member at any time can buy 2,000 miles for $94.13, far less than some of the “bonus” miles cost in this promotion.

Above the display of the promotional fares on the Web site is a box that also shows the lowest restricted and unrestricted economy and first class fares.

Those who do not go directly to the results in the fare display, but instead look at that box, would likely notice that the pro-

FROM THE WINDOW SEAT

motional fares could be higher.

“The beautiful thing about our refreshed and renewed Web site is the transparency,” United spokesman Jeff Kovick said in response to my questions about the promotion. “It gives options. It says, ‘Here’s the promotional offer, and if you want to participate in that, we’ll give you that opportunity.’”

the same benefits for less money in some cases by simply buying 2,000 miles.

“I’m not sure why that would be the case,” Kovick said. “It’s pretty clear on our Web site what fares are available.”

Ultimately, this promotion is an example of caveat emptor rather than an outright scam, but it is playing with fire.

To me, transparency would be a display saying that you can pay $208.80 for a ticket, $208.80 +

$94.13 for a ticket plus 2,000 miles or $484.80 for a ticket plus 2,000

“bonus” miles. Arnie Weissmann _Which _would Editor in Chief you pick?

While there might be some short-term revenue boost for United from this promotion, there is also risk that the nature of the tactics could undermine the trust that’s essential to loyalty marketing. And once loyal customers feel fooled by a promotion directed specifically to them as a “bonus,” they will look elsewhere for trust.

The benefit to United for the promotion seems to rest on the hope that people will think they are getting a loyalty benefit and go straight to the search results for the promotional fares without first looking at the comparison box.

It strikes me that the “ Welcome Back” promotion represents a competitive risk not only vis-a-vis other carriers but also with regard to other distributors of United tickets. If I were a travel agent who sold airline tickets, I’d consider e-mailing this bit of news to clients with a note saying “Don’t worry, I search all fares and make sure you get the best price.”

I suggested to Kovick that the promotion was disingenuous. Its success for United seems to depend on those Mileage Plus members who, excited about the benefit, do not pay close attention to the display.

In fact, looking on the bright side for agents, this may be an instance when agents have reason to be glad that airlines reserved the right to make special fares and promotions available only outside the GDS environment.

It strikes me that the timing of this promotion is particularly ill-advised. Congress is considering re-regulating some aspects of the airline-passenger relationship.