Monday, May 12, 2014

Loyalty Programs, Status, and Mileage Plus Disappointment

If you've seen my recent Twitter feed, you'll note my frustration with United Airlines and their loyalty program. I had booked a flight to Chicago, departing San Francisco at around 6:00pm, scheduled for a midnight arrival, and United canceled the flight and rebooked me on a red eye leaving SFO at 10:00pm and arriving in Chicago at 4:30 in the morning. Flight cancellations happen. It's the nature of travel. For me, the real issues revolve around United's loyalty program, Mileage Plus, and how that correlates to their overall customer service.

First, a bit of background. In the fall of last year, my fiancé had to travel to Japan for business. I love Japan and we thought it would be fun for me to go with her on the trip. At her company, they typically fly on American or JAL, so she often has status on American Airlines. For me, I've been flying on United for many years. So, as I looked at my ticket to Japan last year, I had several choices:
  1. I could use my existing United miles to book a free flight. Over the years, I've collected a number of miles but never spent them on anything but seat upgrades.
  2. I could pay for a ticket on the same flight that my fiancé was on, an American Airlines flight.
  3. Or, I could buy a ticket on a United flight, a flight with enough miles to elevate me back into Premier status. 
I opted to buy my ticket on United and return to status.

How I came to fly United Regularly
In my early days of business travel, I used to be very open about which airline I flew on, with one caveat -- I generally avoided United Airlines. At the time living in the south bay, United didn't fly many planes out of the San Jose airport. Choosing United meant going to SFO, which meant a 45-minute-plus drive, larger crowds, and many more hassles. Then, in the late 1990s, I found myself booked on a United flight out of San Jose. The people at the counter were nice, there was no crowd, the security line was short, and the overall experience was awesome. After that flight, I decided to fly on United for all of my flights, with a preference for flying in and out of San Jose -- selecting SFO only for international flights.

In those days, flying UA out of SJC was mostly painless. They had a very limited set of destinations, Denver, Chicago, Dulles, or LAX, but it was easy and cheap to make a stop in Chicago or Denver if you didn't mind a slight layover.

For a period of time, even flights out of SFO weren't too bad. Before they opened the Bart to SFO leg, Caltrain operated a shuttle from the Millbrae station, and you could get back and forth between Caltrain and SFO on a free shuttle that ran every 10 minutes. Once they opened the Bart to SFO leg though, the shuttle was shut down, the travel time increased to 30-45 minutes, and they started charging you a surcharge for the Bart SFO stop.

After the bankruptcy, the number of available United flights out of San Jose seemed to drop and the flights became increasingly crowded. These days, if you want to fly out of San Jose, the cost for a United ticket to whatever your final destination is usually about 20% higher than the cost of flying out of SFO. But while it may be cheaper over all, many of our business travel programs are now driven by software that compares pricing and if you aren't within $100 of the lowest priced ticket, you're outside of the corporate travel policy. And don't even get me started about the idea of paying to upgrade -- I'd be surprised if there are many corporate travel policies that would cover that.

How the Mileage Plus Loyalty Program Drove Me To Quit Choosing United
You'd think that having logged lots of miles and getting status would be an indication that of an overall level of satisfaction with a service. And yet, it was getting back to Premier status that really crushed the relationship-connection that I felt with United (if liking or preferring an airline is even possible).

In the old days as a Premier passenger, they would automatically upgrade your seat to Economy Plus, an ideal solution for business travel. With Economy Plus, you have enough leg room to be comfortable and space to use your laptop during the flight. Having been through several flights last year in the miserably cramped economy seats, I was hopeful that getting back to Premier status would alleviate this problem. Unfortunately, several years ago, they started selling upgrades to economy plus to everyone, and the number of seats available in economy plus seems to have dropped. With multiple flights on United already this year, not once have I been moved to Economy Plus.

How I Lost Status
Often, business travel can be a choice -- we can push to travel for an event or an activity, or, conversely avoid traveling. Over the past couple of years, I could have traveled more. Often it was easier to avoid traveling than to go through the hassles of uncomfortable seats, long lines, and the always annoying expense report -- the disincentives of travel.

By limiting the majority of my travel to the west coast, I quickly found myself on very few United flights. After all, why should I go through the hassles of going to SFO when I could hop a Southwest flight out of SJC down to southern California for the same cost or less and have a similar or better overall experience? Once, we wound up on an American loop through LAX and it was so bad that I vowed never to fly on American again if I could in any way avoid it.

Once I quit traveling so frequently and I lost status, traveling became even more unpleasant. When you get to this point, you are essentially free to explore other carriers because they are all similarly bad. This is how I can tell you with absolute certainty that the basic experience on JetBlue or Southwest meets or exceeds any base level service provided by the "top tier" carriers. In terms of quality of service, they've got nothing better. And this is why they try to sell you on mileage and status.

This is also why, if you're just looking at the base level of service, the policies that the major carriers have implemented -- like checked baggage fees -- are such a frustration for frequent business travelers. Sure, the airlines can pick up an extra $50 when uncle Fred and aunt Ethel make their annual vacation visit to see the family, but for most of the not business traveling public, trying to skip baggage fees invariably means that lots more people trying to use the carry-on space without practice at maximizing space in the overhead compartment, all to store stuff that they probably could have checked.

The Fading Illusion of Behind the Loyalty Program Incentive
If an airline's base level service is no better than the "discount" airline, their primary incentive for you to use their service is their loyalty program. They sell you on the idea that, if you just stick with them, you could be one of the people who gets preferential, "decent" treatment. It's essentially an unspoken promise that, "don't worry, one day it will get better." 

Consider the benefits of a program like Mileage Plus that counts your travel miles, then gives you credit based on those miles. Your credits can be used to purchase a ticket, upgrades, or even merchandise. Of course, until you purchase something, all of those miles are simply an illusionary currency. In order to get something of value, it often takes a lot of miles, so there is also some incentive to hold onto them for a long time.

Over my years of flying on United, I've had thousands and thousands of miles, but I've never used them for anything other than upgrades to the class of my seat -- something that was useful to me and used to be much easier in the past, but that has become nearly impossible with the reduced human interaction involved in flying these days. Meanwhile, over the years, United has steadily degraded the value of their currency -- where a single class seat upgrade used to cost 5,000 miles for domestic, now it's 20,000. Using miles to book flights -- something I've never done -- is more expensive too.

For many of us, using miles and hotel points to 'purchase' travel or hotel stays is nearly impossible. Not all of us can say, "next August I will take a vacation in fill-in-the-blank destination." Instead, our vacations tend to be more along the lines of, "hey, it looks like we have a couple of days open in three weeks." You can't typically use miles or points for that kind of travel. And do you really want to spend the cost of two or three "upgrades" to "decent class" on a $150 flight down the coast or $300 flight halfway across the country to see uncle Fred and aunt Ethel? Those are the kinds of tickets that we don't usually buy unless they are cheap.

Meanwhile, they keep deflating the currency. I once had something like 100,000 Hilton Honors points -- never actually used them because I couldn't find a window of time, a destination, and enough lead time to try to book with points. Then one day, Hilton expired them all. Nowadays I still stay at Hilton hotels sometimes, but I would hardly call myself loyal. Probably a lot less loyal now.

Two years ago, United was on the verge of "expiring" my miles. Rather than let them lapse, I deciding to give the airline another chance. In that way, you could describe the past year and a half flying with airline as sort of an experiment. During the past year or so dealing with the airline, I've had some pleasant customer experiences with the people working at United. I've had gate attendants jump through hoops to help re-route my flight and avoid massive delays or getting stranded. Really nice people doing a great job. But, fundamentally, the question is the same as I mentioned in one of my Twitter posts: can really great customer service possibly overcome a product that is so otherwise frustratingly poor?

From My Recent Flight
Here are a few pictures that I took on my recent flight.
No Leg Room in Economy Class on United
These new seats have such a small, tight seat back pocket that you can't really put anything in them. The only way that I could even fit a water bottle in that space was to open it, drink about 1/3 of it, then deflate it. Also, you've gotta love the leg room -- I think I probably had less than an inch of clearance.
No Room to Use a Laptop in Economy Class on United
It's a little hard to tell from this photo, but I can only open my laptop partway, maybe 70°. In the past, I've sometimes put my laptop in my lap to try to gain extra clearance, but it didn't seem to help much in these seats. Additionally, because of the way that the tables hinge, I almost bump my knees on the tray table supports.

While these accommodations might be tolerable for a $100 one hour flight down the coast, spending three or four hours like this sucks. Add to that things like paying $10 for wireless internet connectivity that is so bad, you're lucky to successfully load a very simple page like Google, and you have a very unsatisfactory customer experience -- all multiplied by this promise that you've made to me, your loyal status-holding customer, to deliver an exceptional experience.

This is what I see as the real driver underneath the problem. As 'loyal' customers with status, we have passed through the veil, we have seen the truth behind the marketing promise, and there is very little substance to back those promises.

United and Mileage Plus, You Are Now Unpreferred
I'm done. Your loyalty incentive has no substance. Your tiered service levels have reached the point that even Premier status doesn't make them tolerable. You've had multiple chances to wow me and instead simply provided me with more reasons why I don't enjoy spending money with you. I may fly on your airline in the future, but I will no longer choose you.

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