Making friends with frequent fliers

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Top story in the Dallas Morning News:

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http://www.dallasnews.com/sharedcontent/dws/dn/latestnews/stories/072804
dnbusfliers.3826f.html

After collecting tens of thousands of miles in airline loyalty programs
and setting aside time to go away, many frequent fliers complain it's
nearly impossible to get on flights to the popular vacation spots they
want to visit.=20

"Unless you're flying to Des Moines, Iowa, in the winter, on a Tuesday
night, it's almost impossible to get a free ticket," grumbled Scott
Cuming, a San Antonio physician waiting for his luggage recently at
Dallas/Fort Worth International Airport.=20

"I'm shocked when I can use my AAdvantage miles," he said.=20

Responding to such concerns, some carriers are trotting out new tools
and offers to make their programs more flier-friendly.=20

Fort Worth-based American Airlines Inc. has launched a special online
calendar that allows customers to check for dates when seats are
available for certain awards in its AAdvantage program.=20

Low-cost carrier AirTran Airways Inc, which has been building a mini-hub
at D/FW Airport, recently announced it would buy its best customers a
free ticket to anywhere - on any airline.=20

Even as the airline industry struggles financially, loyalty programs
remain critical marketing tools to maintain dialogues with customers so
they keep coming back.=20

Consumers hold more than 8.5 trillion unused miles and more than half
reflect activity on the ground, not in the air.=20

Michie Miller, a nurse from Hickory Creek, collects miles on all of
Dallas' biggest carriers - American, Delta Air Lines Inc. and Southwest
Airlines Co.=20

But Ms. Miller and her husband are careful to use their
AAdvantage-branded Citibank card for most everything they purchase. "We
even use it to pay utility bills," she said.=20

For members of loyalty programs, it's never been easier to accumulate
huge balances through credit card purchases, trips to grocery stores and
dinners in restaurants.=20

Now, it may be getting easier to redeem miles, too.=20

American quietly introduced its new AAdvantage tool earlier this month.
The AAdvantage Hotspots calendar, which extends five months and is
updated weekly, is limited to a few destinations while a more complete
version is developed.=20

"We're trying to make it easier for our customers to redeem awards,"
said Kurt Stache, who recently took over as president of AAdvantage, the
world's largest frequent-flier program with nearly 50 million members.=20

Previously, a traveler's best hope to get a broad view on seat
availability was to check day-by-day online or reach a patient
reservations agent on the phone willing to do the same thing.=20

Efforts to improve=20

American has made other efforts in recent months to improve its
customers' experience with the AAdvantage program.=20

The carrier eliminated a $100 ticket change fee on certain award tickets
that had irritated customers when it was imposed in September 2002.=20

American is also offering mileage bonuses for redeeming award trips
online, as it has for ticket purchases.=20

Southwest's Rapid Rewards program is intended to reinforce the
Dallas-based carrier's easy-to-understand style of doing business.=20

Free tickets are earned based on the number of flights flown, rather
than distance. Southwest awards can be used to go anywhere in its flight
network.=20

Restrictions are minimal, and tickets can be used as long as there's
space on the aircraft. Traditional carriers allow only a limited number
of "award" seats per flight.=20

Southwest even sends $12 worth of drink coupons to use during the
flight.=20

For those reasons, the Dallas-based carrier has been hailed for the last
seven years as having the "Best Award Redemption" among frequent-flier
programs.=20

"We want to focus our message on using tickets, rather than earning
them," said Karen Wright, Southwest's manager of loyalty programs.=20

Changing rules=20

As discount carriers have expanded their reach, wreaking havoc on the
business models of traditional airlines, the rules of the game for
frequent fliers have also changed.=20

For example, the old rule of thumb of using a free ticket for domestic
trips priced higher than $500 is tougher to apply when tickets from D/FW
Airport to Los Angeles can be found for less than $200.=20

Traditional carriers say they're using their loyalty programs as tools
to fight smaller discount airlines.=20

American, for example, has emphasized its programs' global reach over
competitors. AirTran followed with its special anywhere-in-the-world
promotion.=20

For all their commitment to frequent-flier programs, some airline
executives, including American chairman Gerard Arpey, have hinted that
they have become too generous.=20

So program changes focus on tools that allow members to get the most
from their miles. American isn't adding more free seats, though
officials point out that contrary to some reports, it's not reducing
them either.=20

Southwest has tightened its Rapid Rewards program, reducing bonuses for
booking online and increasing the threshold for earning flight credits
on its credit card by 20 percent.=20

Travelers have long had the burden of keeping up with changes in the
program, but now, some say they need to watch industry trends as well.=20

Ms. Miller has been following news reports about Delta's precarious
financial position and has been eager to spend down her balance in the
carrier's loyalty program.=20

"We've been trying to use them, but it's been so hard to find any
seats," she said.=20

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Clay Wardlow

Technical Writer

Advanced Digital Information Corp.

11431 Willows Rd. NE

Redmond, WA. 98052

(425) 897-7448

www.adic.com <http://www.adic.com/>=20

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