I’ve come to accept that we’re going to see lots of fees and a “de-bundling” of services in the travel world and, most particularly, the airline world.  I’m even willing to accept it with good humour at this point.  Indeed, I see advantages to a more “a la carte” system of pricing in the airline world.

I still have an objection, however.  These increased fees for checking bags, changing flights, food and drink and even booking online should also come with some new guarantees.  A checked bag should come with an arrival guarantee that is money back if your luggage doesn’t arrive with you.  A fee for changing flights should come with a money back guarantee if, say, you’re bumped from a flight you changed to.  If you’re going to charge a fee for booking online or accepting a credit card, then you should also make a “prompt refund” guarantee if the flight gets cancelled and unable to travel on a different flight.

The thing is, passengers haven’t really shown much interest in trying to hold an airline’s feet to the fire and I think I know why.  Frequent flier programs.  You see, the airlines *know* that you’ll stick with them in order to earn points that, by any account are worth at most about a penny a point. 

Let’s say you are taking a 2 hour flight to someplace.  Just to be generous, let’s say the mileage is 900 miles earned (and on a 2 hour flight, I would say that is way generous) for each way.  1800 miles or point are earned for completing the trip.  You just earned yourself a reward that at most is worth about $18.00. 

Let me ask you something.  Is that $18.00 worth the abuse?  I’d wager that on any one flight where you had trouble with a lost bag, bad food, a changed flight or anything else that we’re now seeing fees charged on, you would happily pay $18 to see that go away.   Would you change airlines for a flight if another airline made a value promise to handle your luggage responsibly or get your money refunded if they don’t if you weren’t earning $18.00 of credit for that flight?  I’ll bet you would change in no time flat. 

Indeed, I would argue that legacy airlines are punishing fliers dramatically for trying to earn those points.  This is why Southwest Airlines is getting traction with its “no fees” policies for changing flights or checking luggage.  People are starting to figure out it isn’t worth $0.01 / point to earn “free” trips or “free” upgrades particularly in light of the new fee based systems being implemented. 

Sure, an elite frequent flier program participant doesn’t pay many of those fees.  Only, they do.  They pay it in the form of exorbitant prices for fully refundable tickets purchased with a short lead time.  It’s just not necessarily coming directly from their pocket.  It comes from their employer’s pocket.  But there is still a price.

Until passengers start choosing airlines based on the real value being provided, airlines aren’t going to change their behaviours particularly with these fees.

Filed under: Airline Fees by ajax