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United Promises Operational Superiority

SmarterTravel

You may have noticed the not-so-subtle shift in the airlines’ focus recently. In place of bonus miles and cheap airfares, airline marketers have been touting on-time arrivals and best-in-class baggage delivery.

The airlines would be happy if travelers perceived the move as getting back to basics. But for the great majority of flyers, the basics are a comfortable seat and a decent meal. Neither is on the horizon.

Loyalty and Dependability

The dependability-marketing movement, as I like to call it, was spearheaded by Delta, which has made much of its recent operational achievements. In the first nine months of 2015, for example, Delta had already completed 100 days without a canceled flight, an industry milestone according to the airline.

Of the achievement, Delta’s CEO, Richard Anderson had this to say: “More customers are choosing to fly Delta every day because of our consistent, reliable, top-notch operation… Customers value operational reliability tremendously and it can be the deciding factor when it comes to winning their loyalty.” Note the use of “operations” and “loyalty” in the same sentence.

Robert Isom, American’s Chief Operations Officer, in a Credit Suisse presentation on December 3, touted the airline’s new operations center at DFW and committed to being “top of the pack” in terms of product and reliability. Isom was forthright in acknowledging Delta’s leadership in this area. “Delta has done a great job. Hats off to them. They are operating at a level that’s never been seen before.”

For its part, United has followed Delta’s lead in devaluing its mileage program, but has been mum on alternative strategies for retaining customer loyalty. This week, however, the airline made a very public commitment to not only matching the operations performance of its competitors, but to out-performing them. In its 2016 Global Performance Commitment, United promises its largest corporate customers that it will beat American or Delta in both on-time arrivals and flight-completion rates. If United fails to achieve those goals, it will credit the company accounts with United Services Funds redeemable for upgrades and fees. According to United, “Even though we successfully achieved significant and measurable operational improvements this year, we know that there is always room to be better. In fact, we’re so confident in our ability to deliver operational excellence that we’re holding ourselves accountable to our corporate accounts.” (United’s guarantee is in many respects a copy of Delta’s Operational Performance Commitment, introduced earlier this year.)

The Trade-Off

Although the guarantee doesn’t apply to travelers who are not booked through United corporate contracts, all customers benefit from the higher levels of flight reliability United is promising.

No one will complain about arriving on time more often, or about fewer cancelled flights. But in the travel world, there’s no gain without pain. The airlines seem to view these operational advances as part of a zero-sum game: Investments in higher levels of reliability are offset by cut-backs in loyalty-program generosity. This year, Delta and United both made it significantly more difficult for all but their most profitable customers to extract decent value from their mileage programs. American will follow suit next year.

And therein lies the likely future of airline travel: more reliable, but less rewarding.

Reader Reality Check

Assuming you can’t have it all, what’s most important to you: reliability or frequent-flyer rewards?

This article originally appeared on FrequentFlier.com.

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