Friday, May 29, 2009

are airline's recanting thier "nickel & dime" strategy?

Airline's reduced and eventually eliminated travel agent commissions more than a decade ago. They then treated agents like a hated neighbor that was more of a problem than a help to their business model; and in many cases still do treat us poorly. They started pushing to booked tickets on internet sites like Orbitz and Expedia and then on their own sites. Using the internet as their virtually cost free distribution source seemed like a wise idea, but what happens when all those passengers need service to the ticket? Airport ticket counters reduced staff and services and are so overwhelmed just bag tagging & addressing late/mis-connect aircraft, they flat out refuse to help with anything else. Don't even think of asking to issue a ticket for future travel!

Pay for bags, pay for seat assignment, pay for blankets, pillows, food, drinks (which some airlines tried and then back pedaled on). The airlines will say all these charges are adding revenue to their bottom line. However, British Airways recently reported their worst annual losses since 1987 and see no sign of recovery! They are the latest in a long string of carriers that loose millions every month. Yet, other airlines are profitable. When I look at the list, I perceive that I see a little karma.

Now, I can't help but to wonder if they are not recanting the positions a bit. Last week, Delta started a time limited commission program for their "preferred" (read: highest volume) agencies in New York for all flights from New York. Sounds to me like someones airplanes were a little empty and needed to turn on a sales force. I am reading that some of the group and meeting departments that provided volume discounts that were eliminated in recent years are being reinstated.

Are we heading back to the model where the airlines see that agents are helpful and should not be poorly treated?
I know in my business, if I had a sales force that paid for their own existence and all I had to do was commission them on sales closed, that would be a gift!

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