Up, Up, and Dismay, Revisited…

In reply to the last post, “Up, Up, and Dismay,” reader godfreyparke wrote:

Nice posting, only one thing I would add.

The legacy airlines have expended great effort on maximizing revenue from ticket sales. At first blush, that sounds like a great idea, but it’s computer driven and I wonder if they haven’t lost control of their pricelist.

I have a screen dump from the United site (sorry, I can’t post images) for a Boston to Miami flight. Here are the quoted prices:

Economy (lowest) – $325.60
Economy (refundable) – $1,471.10
First (lowest) – $1,067.60
First (refundable) $1,067.60

What clever program makes refundable economy class 40% more expensive than refundable first class?

I’ve seen the TV programs that interview the Ph.D. rocket scientists in airline pricing departments, with their impressive explanations of yield per seat. I also remember seeing TV programs that interview Ph.D. rocket scientists in mortgage underwriting departments, with a different set of equally impressive explanations.

Airline management does not understand their own pricing or flight schedules or maintenance schedules, much less their customers. So how can they manage?

Indeed…  my own “pet indicator” that airlines have jumped the shark is the way that airline employees are (literally) without a clue… that’s to say, are acting on cues– on their computer monitors, departure screens, whatever– with no real understanding of the underlying airline systems those cues represent.  Those systems have gotten too complicated for any of the folks who should understand them– who operate them– to grok… That, or they just plain lie. Either way, they affirmatively make assertion after assertion (“the delay is caused by weather,” “your bags will be switched,” “you can’t change your ticket,” etc., etc.) that are simply untrue.  (The fact that these “inaccuracies” are obvious to many passengers, if not most– that these assurances/excuses/explanations are just plain wrong– doesn’t do much for customer satisfaction nor trust.)

But the (related) phenomenon that godfreyparke cites– being too cute for one’s own good– is all too real as well.  I remember a period in the 90s when Delta’s flights to Miami from many Western cities (routes on which they had competition) were cheaper than their flights to Atlanta (routes on which they had little competition, as Atlanta was/is a “fortress hub” for Delta)…  Turned out that almost all of those Miami itineraries on Delta connected in Atlanta– so passengers (who aren’t the idiots they’re apparently assumed to be) when flying to Atlanta would book to Miami, then skip the connection… The result was double lost revenue for Delta (lower fare to Atlanta + “wasted” unclaimed seats to Miami)…

It’s some measure of the airlines’ mentality that, when this consumer response became clear, Delta didn’t adjust the fares back to sensibility; rather, they tried to punish the passengers (e.g., summarily cancelling return reservations if a connection on one of these “unusually-priced” routes was missed).  Delta was not alone in this kind of tortured pricing (and retaliation); other carriers “played weird” with the hubs that they dominated.  Only when faced with the combination of customer revolt and regulatory attention did the airlines retreat to pricing that was understandable…  if, indeed, we can call the sort of rate sheet that godfreyparke sent “understandable.”

This would all be irksome enough if it’s only impact was on our ability to travel safely and sanely…  but as it’s symptomatic of similar systematic ills across our economy, it’s downright depressing.