Airline loyalty meets some turbulence

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Frustrated customers wait at Chicago O’Hare airport after American Airlines canceled 850 flights
Frustrated customers wait at Chicago O’Hare airport after American Airlines canceled 850 flights

Those traveling on any major airline in the past month have done so with trepidation. American Airlines recently cancelled about 3,000 flights, and British Airways lost more than 20,000 bags last month.

American Airlines and British Airways are strong brand names, says Henry Harteveldt, travel analyst at Forrester Research. But, he adds, faced with these bureaucratic nightmares, these brands are going to have to think about their customer relationships.

“This experience has damaged their image and reputation and they will have to re-earn [customers'] trust,” Harteveldt says. “Airline loyalty programs and e-mail databases give these airlines enormous tools to use to reach out and connect or reconnect with their customers.”

Last week, Northwest Airlines merged with Delta, and used e-mail to help soothe its loyalty members, stressing the value of the merger. The e-mail stressed that WorldPerks miles and Elite program status “will be unaffected by this merger” and that customers can “continue to earn miles through use of partners like World­Perks Visa.” It also highlighted the fact that the merger expands the companies' destinations and, therefore, creates a new opportunity to earn and redeem miles.

As the major airlines deal with these larger challenges, some of the smaller airlines are taking off. Virgin America, which launched in the US last October, has been getting the word out about its brand through a multichannel campaign that incorporates online, print and bus ads. This is creating a more competitive landscape for the major players such as American Airlines, which competes with Virgin for routes.

“It is important for network airlines to reestablish their credibility with travelers, because Virgin America and Southwest have done a good job at creating a pleasur­able experience,” Harteveldt adds.

A good experience is the best way to reestablish trust with customers, as JetBlue proved last year with its Customer Bill of Rights. After snowstorms and poor infra­structure led to a logistical nightmare, the airline was able to reconnect with its loyal customer base by developing a framework for dealing with future problems. Now, customers who are stuck on the runway for more than six hours due to an airline error will receive a free one-way flight.

“It's about good communication,” said Scott Briskman, executive creative direc­tor at Agency.com San Francisco. “I had an airline lose my bags and the customer service representative kept updating me until I had gotten it back. This is the only way to deal with a horrible experience — to make the experience of finding the luggage good.”

With fuel prices up 40% from last year, airlines are faced with more challenges to meeting their bottom line — and issues such as cancellations and lost baggage are not going to help increase sales. Customer service and relationship management are likely the keys to keeping the business above ground.

“The airlines really need to focus on getting the basics right,” Harteveldt says. “Customers want to be confident that when they book the 7am Tuesday flight from Dallas to Louisville, that it leaves at 7am on Tuesday — and that their bags arrive when they do.”

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