Posted by Seth on March 1, 2012 under frequent flyer, News, points | 
I’m generally a big fan of Scott McCartney’s The Middle Seat column in the Wall Street Journal so I was excited to read his post today about "Getting the Most Out of Your Frequent Flier Miles." I was hoping for some great insight into award pricing algorithms or inventory patterns. Instead I got a primer on how to not get any value from points. Such a disappointment.
There are a number of take-aways from the post but the main conclusion is this:
With domestic coach tickets, you generally get not much more than one penny per mile in value from airlines – that’s a $250 ticket for 25,000 miles. If the ticket now costs $400, you likely will have to pay 40,000 or 50,000 miles.
Not only is it simply wrong, but it is also very misleading in terms of getting the most from your points. Other than the programs of JetBlue, Virgin America and Southwest, (and also one option from Delta or American Airlines) the redemption rates are not tied directly to the selling price of the ticket. If there are no discounted seats left it is less likely that award flights will be available at the lower rates, but that’s tied to the inventory, not to the fare price. As the prices go up at the low end it actually means that the "value" realized for redeeming points is arguably higher since the cash option will be more expensive.
McCartney also picks a few random routes and tries to read into overall domestic award inventory based on his searches for economy class seats on one carrier for each route. His approach fails miserable in many ways.
First off, it appears that the searches he performed were based only on using the website of the carrier where the miles are sitting and then by just putting in the end points. This resulted in finding only a handful of seats for Boston-Ft. Lauderdale on Delta, Orlando-Seattle on American or Washington, DC – Austin on US Airways. For the Delta results this approach overlooks the issues that their website suffers from for award bookings; it is very limited, especially when searching for connections. For American I see very different results than McCartney did, with plenty of award seats open at the "Saver" level.
Both of those are questionable, but the US Airways one is the most egregious bad advice of the three:
And if you’re in Washington, D.C., and have US Airways miles you’d like to use to go to Austin, Texas, get ready to pay a heavy price—besides the $25 processing fee that US Airways charges for a “free’’ ticket. For the 10 months in the rest of this year, there are only five days when US Airways offered a flight to Austin at its basic mileage price.
In addition to only searching on US Airways’s website, McCartney ignores the fact that Dividend Miles can be redeemed for flights operated by United Airlines. Checking the award calendar there it is clear that finding an award seat from DCA-AUS is actually a rather trivial task on most days for the rest of the year. Yes, you’ll have to call in to book it, but that’s a small penalty for saving 25,000 points.
Sorry, Scott, but you missed the boat BIG TIME on this one.
Tags: American Airlines, award, Boston, Delta, frequent flier, frequent flyer, JetBlue, points, Seattle, Southwest Airline, United, US Air, Virgin America, Washington DC
Posted by Seth on February 15, 2012 under frequent flyer, News, points |
During their most recent earnings conference call JetBlue indicated that they were working on adding 5-7 more interline partners to their portfolio. At that time I suggested that a link-up with JAL at Boston was likely in the works. JAL is bringing their 787 Dreamliner to Boston starting in April 2012 and JetBlue has onward coverage from Boston to a number of destinations on the east coast and in the Caribbean. It is a natural fit.
Not surprisingly, the two carriers announced such an agreement this week. The interline deal also covers travel over JFK and LAX between the two carriers. Unlike the recent deal with Hawaiian Airlines this one is only for interline, not any frequent flyer reciprocity, but it is still a growth in the partner offerings for JetBlue.
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Posted by Seth on February 13, 2012 under Flying, frequent flyer, News, points |
JetBlue is continuing their exploration of different marketing ideas for bulk travel this winter, offering up “Go Packs” for customers making frequent trips in the intra-California market. The company is offering up fixed-price blocks of 10, 20 or 30 flight coupons, each valid for a one-way trip between their hub in Long Beach and the northern California airports of Sacramento, Oakland and San Francisco. The packs are priced between $70-90 per segment, plus $7 per flight at the time of actual booking for government fees.
The flight coupons are valid for last-seat availability on all flights, up to 90 minutes prior to departure. They are valid for travel between March 1 and May 23, 2012 and, perhaps most interesting for bulk ticket purchases, they are freely transferrable between passengers until the flight is actually booked. This means a company can purchase a block and then assign them out to employees on an as-needed basis rather than having all the seats in one passenger’s name. The TrueBlue points will accrue only to the account of the person making the purchase, not to the individual travelers on each flight. Packs must be purchased by February 22, 2012, or wihle supplies last.
With the last-seat availability and ability to assign the seats to any passenger up to 90 minutes before departure the packs are a great way to set fixed costs for the commuter travel. But they aren’t necessarily the cheapest rates. Booking today it is possible to purchase seats, even for walk-ups, at a lower per-ticket price on many days:
But those fares are not guaranteed to stay low and they certainly are not transferrable or as flexible as the Go Packs are. And, quite frankly, the price point is still very attractive, even a bit above the advance-purchase fares.
There are a few other markets on the east coast where such a marketing effort seems like it would be attractive, both for the company and the customers. Perhaps we’ll see more of this sort of thing in the future.
Posted by Seth on February 3, 2012 under Internet, News, Review |
JetBlue rolled out an updated website and also launched an iPhone app today, marking the carrier’s first foray into mobile apps and also a significant update to the online presence. The new website is much brighter (lots of orange) and the TrueBlue program gets a lot of love on the new site, showing at least three different places on the main page. I’m not a huge fan of the slide-out menus that move the rest of the page around, but there they are.
Overall the website changes appear to be mostly aesthetic, which is fine. Unfortunately, however, they managed to leave the one bit of the old site that is pretty awful on the old platform. The online check-in process is still the same flash-based mess that it has been since the Sabre migration happened. That was the one bit that really needed help and it didn’t get any. There are other bits of the site, like the airport guides, that have a rather unfinished feel to them. Hopefully those get touched up soon enough.
The mobile app, on the other hand, is a pretty solid offering overall, particularly for a v1.0 product. It offers flight booking, management, tracking and check-in functionality, all the basics that a mobile app should have to be useful. But it also has more.
The flight booking option is a slightly different interface than the other mobile apps I’ve seen, most notably in the seat selection, which comes on a scroll wheel rather than a seat map picker. I’m not sure if it is good or bad, but it is definitely different. It can also use geolocation to display default departure airports based on where you are, which is a neat feature, though not necessarily incredibly valuable.
There are some bugs in the flight booking interface still (remember, it is a v1.0 product), so scrolling down to the bottom of the page can result in seeing things like all the error messages that might be displayed if something goes wrong, but that doesn’t seem to interfere with the actual functionality so not a huge problem. I expect that those will be cleaned up soon enough.
The in-flight entertainment guide is pretty basic, but it includes a list of the DirecTV channels available and the movies showing, along with reviews. The in-flight section also has details on the food and snack options, including wine pairing suggestions such as Sauvignon Blanc with Terra Blue chips (apparently the citrus finish is great with the salty chips).
The highlight of the app, to me, is the "My trips" section. The display of upcoming trips is intuitive and offers up all the appropriate information on a single screen. The online check-in, social media share (Twitter and FaceBook) and "Pick me up" email features are also very nice. The flight review bits on the mobile app are arguably better than those on the main website.
And, there is more available via the trip interface. Tap on the city and you get access to the City Guide section of the app. In addition to airport information the City Guide includes tips on sights, dining and activities in the destination cities. Strangely, I cannot find any way to access that information other than via a scheduled trip, but it is nice to see that the company is working on making that happen. Hopefully they can add more content (it is somewhat sparse right now) and they expose it more directly in the near future. It would also be nice to see this content make it into the main website; it does not appear to be there right now.
Speaking of things that I hope to see in the future, there is a section in the flight booking portion of the site, both on the main website and the iPhone app, called "Add extras." Currently that section only says, "The flights you have selected don’t offer any upgrades," so there is nothing that can be selected but it certainly opens up a number of possibilities for things that might be coming. This is separate from the Even More Space seating option, though that might be something that is listed here. But there could be other things as well. This is definitely an interesting revelation that I’ll be keeping an eye on.
Overall the app is a much bigger leap forward than the website updates. Both are nice, but the app is very impressive, particularly in the my trips section. Hopefully the Android app which is expected soon will be similarly functional and both will continue to improve, fixing the little bugs that are showing today.
Posted by Seth on January 29, 2012 under Flying, News |
What happens when an airline CEO gets ahold of a Twitter account? In the case of JetBlue CEO David Barger, the answer is an entertaining amalgamation of content. And some of it is even about the airline. Actually, this week, a ton of it was about the airline.
In a guest post I’ve got online for Flying with Fish today, I take a look at route scheduling, as seen through the lens of Barger’s Twitter feed. He gives hope to some communities (PVD, I’m looking at you) and dashes the dreams of others (HVN, MSN, LAL and MLB all take a hit). Even better, however, is that he also manages to engage others from within the company.
Then again, maybe "better" isn’t the correct term there. Being told to zip it by your Corporate Communications group probably isn’t the most appealing tweet to read.
Anywho, give the post a read; there’s some interesting stuff in it.
Posted by Seth on January 26, 2012 under Flying, frequent flyer, News |
Today’s quarterly earnings conference call from JetBlue had a few interesting bits of information that was unveiled, giving insight into future developments that can be expected from the carrier. The company reported a profit for both Q4 2011 and the full year, but there are also some very real challenges that the company is facing in 2012. As one person said on the call, "The honeymoon we enjoyed prior to this period is over."
A lot of the news which I found most interesting was around the "Even More" products that the company sells. What started with Even More Legroom seats offering additional pitch in the cabin has expanded to Even More Space (offering pre-boarding to ensure overhead bin space) and Even More Speed for access to priority security lines in many airports. This service started in 15 airports and recently expanded to 9 more. And selling the service resulted in $120MM of incremental revenue for the company in 2011. That’s a huge number, more than 20% of the total incremental that the company saw in the year.
Given the high revenue realized from the offering, it is not surprising that the company is expanding the number of seats for which it can be purchased. Specifically, the company confirmed that they will be adding 8 more seats to their Embraer E90 planes in the Q2/Q3 timeframe this year. Full details aren’t yet available on the announcement (seems to be a bit of a pattern there lately) but a quick review of the seat map suggests that they can get away with sliding a couple rows behind the exit row around and not really have to change too much else around, so long as they’re willing to keep the 34" pitch that the E90 has. If they go for the 38" that the A320s have they could also do that behind the exit row with minimal impact to customers, changing the other seats in that section from 33" to 32" pitch. Either way, it looks to be a positive change for the company to make more EML seats available.
Beyond the Even More bits, the honeymoon comment piqued my curiosity. The company had a huge growth spurt a few years back, taking on a bunch of new airplanes in a very short timeframe. Those acquisitions are now hitting the magic point in the life of an airplane known as a "C-Check." The maintenance costs for the C-Check and engine restorations on the aircraft are significant and the number of planes the company has going through that process in the next couple years is quite high. The result is a spike in maintenance costs. JetBlue has worked with their maintenance suppliers to mitigate the costs somewhat, but it will still be a challenge for the company in the coming years. And that’s all with a fleet that is still only 6.1 years old on average with a maximum age of 12 years.
There was mention of the new Hawaiian Airlines partnership, but no additional details shared there. And it was suggested that 5-7 new partners will be coming online in 2012, with links at Boston and Orlando likely rather than just at New York City. I’m betting on JAL being a partner via Boston with their new service there starting soon, but who knows.
Other than those bits, not a whole lot of interest. Plenty of accounting mumbo jumbo but nothing that seems especially significant at this point. And there are still a number of open questions, like where the company stands on rolling out additional benefits for their most frequent customers or many of the partnership details with Hawaiian. I guess patience will have to suffice.
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Posted by Seth on January 23, 2012 under frequent flyer, News, points |
The partnership with Hawaiian Airlines marks a number of firsts for JetBlue. While all the details are still not yet available there is enough information in the press release about the partnership to identify these developments, all of which seem to be quite positive.
For starters, Hawaiian will be, subject to government approval, adding their code to some JetBlue flights. None of the previously established interline agreements have included such a marketing offer. This is not particularly significant from an operational perspective but for pricing reasons this should allow fares to be sold that are not necessarily additive via the connecting city. That’s a big step for JetBlue and a great benefit for the customers in terms of pricing.
The other major first is that the deal will permit not only accrual of points in both programs – on all flights, unlike the limited partnership with American Airlines – but it will also permit redemption on all flights:
Hawaiian and JetBlue have reached a preliminary agreement to allow members of each carrier’s frequent flyer program to earn and redeem loyalty points or miles for travel on either carrier. Under this agreement JetBlue’s TrueBlue members will soon be able to accrue points on any Hawaiian-operated flight, while HawaiianMiles members will be able to earn miles on any JetBlue-operated flights. Similarly, frequent fliers will be able to redeem their points or miles for travel on either carrier’s network, bringing new, much-requested destinations to each program’s loyal members.
The details on earning and redemption rates are scarce at this point. And the two programs are quite different, with Hawaiian operating a more traditional model (points earnt by distance flown; redemption calculated by zones) while both earning and redemption rates in the JetBlue TrueBlue program are more tightly tied to the fare on the flight. Obviously there will need to be some reconciliation between these two schemes along the way.
The arrangement also marks the first time that a JetBlue partner will operate from the JetBlue terminal at JFK airport. There is at least one gate in T5 which can support the Airbus A330 aircraft that Hawaiian will be flying in to New York City, though it remains to be seen what the impact is on the waiting areas with a 294-passenger aircraft using the space; the JetBlue A320s max out at 150 passengers.
Still a number of questions to be answered, but lots of positive developments so far.
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Posted by Seth on January 23, 2012 under frequent flyer, News, points |
Hawaiian Airlines and JetBlue will announce today a partnership for both travel and their frequent flyer programs. The deal comes on the heels of the recent announcement of new service by Hawaiian Airlines with the upcoming launch of non-stop service between New York’s JFK and Honolulu. While the Hawaiian service doesn’t start up until June, the deal will start sooner, with the carriers routing passengers via Los Angeles for one stop service on interline itineraries.
JetBlue has been steadily growing their roster of interline partners but one one of those – American Airlines – has any form of points reciprocity set up. This deal will include at least some reciprocity on the frequent flyer side. Full details are yet to come, but it is nice to see benefits in both the flight and loyalty programs coming to fruition.
More details to come as they are made available…
Posted by Seth on January 10, 2012 under frequent flyer, points |
JetBlue and interline partner South African Airways have come up with a rather interesting promotion for earning points in the TrueBlue program this month. They’re letting passengers double dip on points earnings for a limited time, netting 10,000 TrueBlue points in addition to the regular points the route would earn on South African. The rules are reasonably simple: Book by 20 January and travel by 31 March. Fill out the web form after the trip and you should score the TrueBlue points.
There is also a contest to win two "free" tickets to South Africa, but I’m not as convinced of the value there. There are blackout dates, which is fine, but the winner is responsible for all fuel surcharges on the winning, which is pretty crappy, especially considering that they are still "subject to seat availability" as well.
I wouldn’t go out of my way to book a trip just for the TrueBlue points, but if you’re buying and flying inside the promo dates anyways there’s definitely nothing wrong with 10,000 free TrueBlue points.
See http://flysaausa.com/jetblue/ for all the fine print.
Posted by Seth on January 10, 2012 under Flying, frequent flyer, News |
As part of their bankruptcy reorganization efforts American Airlines has announced that they are cutting the longest route in their network, the flights between Chicago and Delhi, India. The flights are being terminated as of March 1, 2012. Live from a Lounge (a local on the India side) and One Mile at a Time (a quite vocal AAficionado) have both weighed in on the topic, mostly with disbelief. To me the surprise is really that it took the bAAnkruptcy to do the route in.
At least one analyst out there says the route was losing $40MM annually. And naturally you’re going to cut anything that isn’t profitable in a reorganization, right? The problem with that approach is that, at this point, nearly everything American touches is not profitable; they’ve got the inverse of the Midas touch. The real question should be whether a route can be profitable, not whether it is right now. And in the case of the Delhi flight, the answer is still no.
It is the longest route in their system, roughly 7500 miles in the air each way. That’s a whole lot of fuel that needs to be carried so the plane can make it to the destination, and that fuel has increased significantly in cost since the route was launched in 2005. It seems that even if the company could get the labor costs down, their stated goal in the bankruptcy process, the other fixed costs of the route are still too great.
The same analyst who asserts the $40MM annual losses also suggests that there are a few other routes which are hemorrhaging cash and which seem primed to be cut: New York-London, New York-California, Chicago to Delhi, Beijing and Shanghai and Miami to Buenos Aires. Seems unlikely to me that all those are going to be touched. The London routes gets the advantage now of ATI, something that was far too late in being granted by the authorities on both sides of the Atlantic. That should help significantly for margins on that service. The transcon market is an interesting one and I could see some changes come, but I doubt they’ll fully retreat. And the South America service seems to have way more potential than the Asia routes, putting it squarely in the "potentially could be successful" category.
Could the Beijing and Shanghai routes be on the out? Loads to China are down and the yields are likely following. At the same time, however, getting back into that market is incredibly challenging. Plus, there aren’t particularly great onward connections if you look to partners. It seems much more likely that the China routes could be profitable and that they’d stick around a least a bit longer.
The other consideration for American, more than individual routes, is the combined effect of cutting too much on the route map. Their international network was already somewhat anemic outside of Latin America and further cuts won’t help that. Even with partners and the ATI agreement, it is hard to market and sell flights to corporate contracts when you don’t actually have service to the destinations they need to serve. And a merger with US Airways, JetBlue or Alaska Airlines isn’t going to solve any of those problems.
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