It has been my experience that if
I'm in a loyalty program with an airline and it screws up, it may
offer me some miles, in addition to an apology, as a gesture of
But United Airlines
is breaking new ground by offering miles up front to loyal
passengers as an incentive to let the airline potentially abuse its
relationship with them.
United recently sent
some members of its Mileage Plus program an e-mail with the subject
line "United welcomes you back with bonus miles."
"Your next United
flight could be worth 2,000 bonus miles," the text reads. "Simply
take advantage of this special opportunity, and -- in addition to
the miles you automatically earn as a Mileage Plus member -- you'll
also earn 2,000 bonus miles the next time you fly
Notice the language:
"bonus miles ... take advantage ... special opportunity." Reading
this, a Mileage Plus member might assume they are about to get a
little reward for flying United.
Yes, advantage is
about to be taken, and, for United at least, this is a special
A look at the results
yielded by this promotion demonstrates that a loyal Mileage Plus
member who purchases using the promotion code MPGT27 is very likely
to pay more -- sometimes more than twice as much, in fact -- than a
first-time flyer who simply books the same flights without the
bonus miles through a travel agent, online agency or even
Going from Chicago to
New York? Book on United.com and you'll pay $208.80. But enter the
promotion code, and the same flights on the same days are displayed
Denver to Seattle?
You could pay $328.80. Or if you want to take advantage of this
special opportunity, you can pay $484.80.
San Francisco to
Austin? Your 2,000 bonus miles will only cost you $153 extra
($495.20 vs. $342.20)
In a search of dozens
of flight pairs, comparing promotional rates with other United
rates for the same flights, Travel Weekly's editorial assistant,
Theresa Bednarczyk, found only one set of flights where the fare
was exactly same, on the Los Angeles-Orlando route. None was
Could this be a
result of timing, of fare movement due to normal yield management
fluctuations? I don't think so. Bednarczyk tested the promotion
over the course of three days. Fares rose during this time period,
but whenever the fare increased on United.com without the promotion
code, it also went up proportionately with the promotion
In essence, Mileage
Plus members who purchase using the promotion code are, in most
instances, buying miles, but perhaps at a premium. Without
purchasing a ticket, any Mileage Plus member at any time can buy
2,000 miles for $94.13, far less than some of the "bonus" miles
cost in this promotion.
Above the display of
the promotional fares on the Web site is a box that also shows the
lowest restricted and unrestricted economy and first class
Those who do not go
directly to the results in the fare display, but instead look at
that box, would likely notice that the promotional fares could be
"The beautiful thing
about our refreshed and renewed Web site is the transparency,"
United spokesman Jeff Kovick said in response to my questions about
the promotion. "It gives options. It says, 'Here's the promotional
offer, and if you want to participate in that, we'll give you that
To me, transparency
would be a display saying that you can pay $208.80 for a ticket,
$208.80 + $94.13 for a ticket plus 2,000 miles or $484.80 for a
ticket plus 2,000 "bonus" miles.
Which would you
The benefit to United
for the promotion seems to rest on the hope that people will think
they are getting a loyalty benefit and go straight to the search
results for the promotional fares without first looking at the
I suggested to Kovick
that the promotion was disingenuous. Its success for United seems
to depend on those Mileage Plus members who, excited about the
benefit, do not pay close attention to the display.
I asked if he thought
that people would be unhappy to discover that they could have
gotten the same benefits for less money in some cases by simply
buying 2,000 miles.
"I'm not sure why
that would be the case," Kovick said. "It's pretty clear on our Web
site what fares are available."
promotion is an example of caveat emptor rather than an outright
scam, but it is playing with fire.
While there might be
some short-term revenue boost for United from this promotion, there
is also risk that the nature of the tactics could undermine the
trust that's essential to loyalty marketing. And once loyal
customers feel fooled by a promotion directed specifically to them
as a "bonus," they will look elsewhere for trust.
It strikes me that
the "Welcome Back" promotion represents a competitive risk not only
vis-a-vis other carriers but also with regard to other distributors
of United tickets. If I were a travel agent who sold airline
tickets, I'd consider e-mailing this bit of news to clients with a
note saying "Don't worry, I search all fares and make sure you get
the best price."
In fact, looking on
the bright side for agents, this may be an instance when agents
have reason to be glad that airlines reserved the right to make
special fares and promotions available only outside the GDS
It strikes me that
the timing of this promotion is particularly ill-advised. Congress
is considering re-regulating some aspects of the airline-passenger
And members of
Congress, too, receive Mileage Plus promotions.