Randy Petersen's Opening Remarks – April, 24 2008

Randy Petersen's Opening Remarks – April, 24 2008

“Would Have Been 25 Years Old This Month

I did not see it coming. I suppose the signs were there all along — the struggles Aloha Airlines was having with its finances and more importantly, the fierce competition of an upstart in the marketplace. Aloha has been around for more than 60 years and has seen and weathered the good years for tourism and local traffic as well as the lean years, especially those following the first Gulf War. And when Gordon Bethune signed on to help out back in 2006 following their exit from bankruptcy #1, they had someone very seasoned to help the airline out for the long haul. But, these hard times take no prisoners and I am extremely saddened to know that members of AlohaPass have nowhere to turn, no awards to redeem and no benefits to show for their choice of Aloha over Hawaiian. AlohaPass would have been 25 years old this month (launched in May 1983). It wasn’t all that long ago, late 2003, that AlohaPass spruced up their program for the first time in 20 years, dispatching with the dated Executive Club elite-level program in favor of the local flavor of the Ali’i Loyalty Rewards elite program. So, in honor of those who have the memories, both good and bad, we salute the passing of “The Aloha Airline.”

As well, the loss of the ATA Travel Awards program, which had one of the lowest thresholds for earning award travel in the industry, is another one no one saw coming — especially considering the airline’s partnership with Southwest Airlines. After teasing Rapid Rewards members with Hawaii and the allure of international expansion (Mexico is “international” if you were born in Sioux City like I was!) it will be interesting to watch what Southwest does now for its members. The reason I say that is if you look at the Freddie Award results elsewhere in this issue, you’ll see that Southwest Rapid Rewards members voted last year’s “Southwest Rapid Rewards Fly 2, Get 1 Free. Fly 4, Aloha Hawaii” promo, which featured Hawaii via the ATA partnership, as the winner of the Best Award category. One can’t overlook that Hawaii was important enough for Southwest to craft a promo around the destination and for members to have voted its value so high. I think we’ve got to stay tuned.

Part of my job requires sniffing around for news. And after all these years, I’ve got a pretty good nose for it. When I was looking over the positioning and words used by Delta in describing the launch of their Pay With Miles program (and it turns out I was right in that it will include last seat availability!), I saw the use of some carefully crafted words — such as strategy. One thing I’ve learned well is how to play partners off each other to get at the latest news. So, when I heard that from Delta, I talked with American Express and pretended that I was aware of the other part of the strategy. Well, it worked and I’ve got it all figured out — a new credit card from Delta called Delta Reserve. You might remember if you read this column, I wrote about the premium credit card from Continental, the Presidential Plus World MasterCard, when it was launched back in 2006. (I’m waiting on the new super plastic from AAdvantage/Citibank.) So now, I know where all this is headed. The Delta Reserve card is not cheap — some $450 a year. But let’s face it, it is cheaper than Centurion and the real Platinum card. What credit card is so cool that it’s worth $450 a year? Well, it comes with an annual Delta Crown Room membership, which depending on your level of membership with Delta, currently sells for $350-450 (includes the initiation fee!), and the most desirable asset, earning EQMs based on credit card spend. Members spending $30,000 annually will be blessed with 15,000 EQMs. Spend another $30,000 annually and another 15,000 EQMs roll your way (a limit of 30,000 EQMs annually can be earned). Now, you’ll have to trust my math, but 30,000 EQMs allows you to be a Silver Medallion member. You can go from any level to Silver, Silver to Gold and from Gold to Platinum — all with the swipe of your credit card. And that’s not all, members can also gift 15,000 EQMs to others so now you know what to give (or to get) for the holidays. There’s more to this card but it certainly will carry forth the new generation of premium cards for frequent flyers. Here’s how I look at it. I’m paying roughly $9 a week to have the Crown Room available to me when I travel. Or I’m looking at the cost of nine day passes throughout the year to the Crown Room if and when I need that benefit — and with current industry delays — I will need it. Or I’m looking at the newest way for me to stay home during the holidays instead of making the mileage run that ensures my elite status for next year. Take your pick of reasons.

I was walking by an editor’s desk when she was interviewing Rene Mizwicki, Director of Hyatt Gold Passport, for this month’s 60 Seconds on page 20. I was very interested to hear the dialogue of how Hyatt came up with the name Yatt’it for their new social media Web site that I encourage you to read all about it. Very catchy and certainly not like your father’s Hyatt.

And finally, our cover story last month might have seemed a little off the mark when everyone was saying that the merger between Delta and Northwest was not going to happen because of pilot concerns. We’ve been doing this long enough to go with our instinct which was that the story was not over, thus the article. Hope you found it useful as you may just need the information after all!

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