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Frequent Flier Programs (and Constant Expansion/Competition)

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#1
aoumd

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This has likely been discussed, and may even be on the list for the next AE, but I'd suggest frequent flier programs be added as a way to build customer loyalty.  

 

SPECIFICALLY, I'd propose a model similar to the marketing tab where you have a scalar percent of revenue that can be selected to be your Frequent Flier Program expense, with a higher percent giving a better program.  For each level of "better" program you get, you retain a higher share of your passenger base and demand carried when a new entrant enters a city pair you fly on, even with a lower fare.

 

Let's say right now you have a city pair where you carry all passengers.  Right now, if someone else comes in and undercuts your fare, you lose nearly all of those passengers to the other carrier.  Under this hypothetical scenario, let's say even if the other carrier offers a lower fare, you could retain 15, 30, 45 percent of those passengers you had previously carried based on the quality of your frequent flier program and the customer loyalty it built.  

 

In the real world, when Frontier entered the DCA-DEN market with low fares, it did not mean United flights started to go empty.  United has a base of frequent fliers who stick to them.

 

This is important because it adds a new element that provides an alternative to "constant expansion" as the way to retain a good position in the game.

 

What do you think?



#2
Tesla

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Yeah! It will make the frequent flier thing just as bad as marketing, that's the issue. Some customization would be good.



#3
aoumd

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OK, so maybe I proposed one very simplistic way of doing it.  Certainly more granularity can only help in the game.

 

My point was: the Frequent Flier program should be a feature which allows one to invest in customer loyalty, so that some of your existing customer base is shielded from jumping to a competitor when others enter a given city pair market.



#4
Shaq

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It is a good idea. I would prefer freq flyer programs to be like cutomizable like IFS. Each airline can decide how to reward it most important pax.

Example: WN gives you points, Spirit discounts, UA awards flights, GPU, etc.



#5
Tesla

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My frequent flyer program would work like this:

 

1. Each passenger get's 10 points for each $1 they spend with the airline, when they pay with their card. 

 

 

btw, you don't need discounts on Spirit. Even someone living in an Indian Slum can afford Spirit (without the fees).



#6
Oliy.

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This will be in AE4.

#7
CourtingPsych0

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when ever ae 4 releases haha



#8
Denver.

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Will there be a AE- 4 is the Next Question??


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#9
Yuxi

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This is not on the list for AE 4 at the moment, at least until we figure out what mechanisms it would have. It's definitely up for discussion, since managing loyalty and getting additional liquidity from selling FF points is a big part of running an airline



#10
bAnderson

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I would assume that it would be based on time flown and overall reputation


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