Henry Harteveldt is one of the smartest people I know. I cited his work in a regulatory comment I filed with the Department of Transportation a couple of months ago.
So I take it seriously when he calls me out on one of my posts.
Yesterday Delta made a big splash announcement about the rebranding of their cabins.
But as with the introduction of Sky Priority four years ago, they roll up a bunch of existing benefits and call is something exciting and new and generate a whole bunch of buzz (largely from outlets who don’t know there’s nothing new or better involved).
To be sure, it’s common to roll up several non-new things to make whatever is being announced sound like ‘news’. American’s announcement about lie flat transatlantic Boeing 757s and extra legroom seats on US Airways domestic narrowbodies was made to sound really big by billing it as $2 billion in investments — including all of the investments that were already being made, some of which are even in service already.
My point about Delta’s announcement was (and is) simply that:
- It’s sizzle, little change of substance. New seat covers are the biggest change. This was a much-hyped announcement, and there’s simply not much to it.
- The changes aren’t even unambiguously good for consumers. Delta’s Gold elites, who used to be able to confirm extra legroom economy seats at time of booking, will only be able to get the seats if still available 72 hours prior to departure.
- Delta will no longer be offering their 50,000 mile flyers, then, something that both United and American offer to their 50,000 mile flyers.
Of course, since United appears to manage by doing what Delta does, it’s entirely possible that United could quickly follow suit with this change!
I actually have no opinion on whether an airline ought to allow 50,000 mile flyers to confirm extra legroom economy seats for free at time of booking… whether the right customer segment to offer this to is 200,000 mile flyers or 25,000 mile flyers even. There’s data each program has that can inform a judgment on this that I do not have access to.
But the Delta announcement struck me as offering far less than it seemed to imply, and that to me is worth noting. It also seemed worth consumers understanding the change. Airlines will offer value propositions, and consumers will opt for those that work best for them. I love that Spirit Airlines exists, they offer their product and their value proposition, I don’t find it the most compelling one in the market for me.
I rarely feel badly for an airline, since whatever the proposition they offering is one they’ve chosen to put on offer. So I cannot subscribe to Henry’s take:
The programs themselves are profitable. Airlines are now, but they haven’t been over much of the past 15 years. It’s perfectly appropriate to determine a profit-maximizing bundle of offerings. I will say when I think that bundle is worth less than before, especially when it’s suggested that the bundle is worth more.
I’ll also say when a bundle seems incoherent, or perverse. That’s not the case here. It is the case with how US Airways treats its current ‘choice’ seating in economy.
- There’s no extra legroom.
- All elite members are charged.
US Airways 100,000 mile flyers get complimentary upgrades to first class. But if they want one of the choice economy seats that don’t even have more legroom, they have to pay. That’s odd.
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