Delta Air Lines CEO to adjust SkyMiles for frequent flyers


When Delta slipped up on changes to its loyalty program, its competitors were inevitably close behind.

Earlier this month Delta revealed it would limit access to its beloved Sky Club lounges for many American Express users, as well as rewarding customers with elite status based on how much they spent.

The news didn’t go down well with customers: many took to social media to warn they’d be switching to other carriers with better benefits.

However, Delta CEO Ed Bastian has heard the message loud and clear, and now promises his team will roll out a raft of policy tweaks in the coming weeks.

Speaking to the Rotary Club of Atlanta, Bastian explained that the company had been overwhelmed with premium-tier travelers following the pandemic—when passengers were allowed to roll over their status and air miles into the next year despite flights being grounded.

The airline now has double the amount of “diamond” tier customers (people who spend $20,000 every year in addition to 125,000 miles flown or 140 take-off to landing ‘segments’) because of the pandemic, Bastian said, adding: “All our diamonds are special, but we’ve got a lot of you.”

“It’s got to the point honestly where we have so much demand for our premium product and services that are far in excess of our ability to serve it effectively in terms of our assets,” Bastian told the Atlanta audience. “Whether it’s Delta One, whether it’s the Sky Clubs, the upgrade certificate, the special lines of agents that pick up the phone immediately when you call.”

He added: “We had to figure out a way to continue to effectively serve those at the various tiers and so we did announce some changes.”

The update that angered Delta’s elite fliers included the announcement that American Express customers who hold Platinum and Business Platinum cards would have their Sky Club visits capped at six per year.

Meanwhile customers who are Delta SkyMiles Platinum, Platinum Business American Express card members, and basic economy travelers would have no access to the longes.

Bastian pointed out that many of the changes are not set to come into effect until 2025, joking: “You’d think they were happening tomorrow,” but said updates to the policy would be announced in the coming weeks.

Delta did not immediately respond to Fortune’s request for comment on when these updated guidelines will be made public.

‘Feedback is a gift’

The plan to overhaul Delta’s travel benefits had gone slightly askew, Bastian admitted, justifying the sweeping changes with the fact that the company hadn’t wanted to continually change its rules year after year.

“We need to make certain that we can serve our higher tiers with a level of premium experience that [they] deserve and expect,” the boss of the Atlanta-based airline said. “No question we probably went too far in doing that, our team wanted to rip the band aid off and didn’t want to have to keep going through this every year and nickel-and-diming.”

Bastian admitted: “I think we moved too fast, so we’re looking at it now. We’re in a business of serving people and we want everyone to be served at the highest level, it’s just way in excess of our current asset base and it’s unsustainable where we’re at now.”

But despite hinting that he personally has received an onslaught of criticism — as well as customer service agents answering the phones — Bastian said the response from customers on the topic has been a “gift.”

“I appreciate it, I really do because it’s important,” Bastian said. “One of the things about that feedback, you realize how much people, particularly our loyal travelers love our company, they love what we do they love our service.

“The feedback matters. We’re still assessing what we do but there will be modifications.”

‘Cozy’ up to the competition

Delta’s rivals didn’t waste time in trying to tempt irate customers away from the airline.

“Feeling ‘Blue’ about the changes to a once-favorite loyalty program?” JetBlue wrote in a release following Delta’s announcement earlier in September, adding: “We’ve got the answer.

“Breaking up is hard to do. But who has to know? We’ve made it easy for you to cozy up to a new loyalty program and see where it goes.”

Alaska Airlines took a similar tact. Earlier this week it posted a coy advert for those who have “fallen out of love with their airline loyalty program”, asking: “Do you feel like you have to be a millionaire to actually earn status?”

The company’s new offering explicitly states that outgoing Delta passengers can be “status matched” into an Alaska Airlines plan, even pledging to up the status level of Delta customers who are due to hold their tier in 2024.

However, the plays by JetBlue and Alaska Airlines are against a much bigger rival. Where Delta has approximately 200 million customers a year, and 4,000 flights a day, JetBlue has 40 million customers and operates 1,000 daily flights.

Meanwhile Alaska Airlines boasts 46 million customers and 1,300 daily flights.

Delta also has the added advantage of being the longest-standing brand, having been founded in 1925 while Alaska Airlines was launched in 1932 and JetBlue in 2000.

Source link

Leave A Reply

Your email address will not be published.