The New Full Fare: More
Perks and a Big Stick
FEBRUARY 2, 1993 -- The nation's commercial airlines are trotting out spiffy new carrots, as well as fearsome-sounding sticks, in their eternal effort to persuade frequent flyers to pay top dollar--and play by the fare rules designed to ensure they have no options but to buy the inflated full-eoach fares.

As traffic has slumped and full-fare prices have resumed their upward trek in recent months, carriers have been darkly hinting that they've developed quick-witted new computer programs capable of ferreting out even the most covert back-to-back and hidden-city ticketing ploys. And they threaten to get nasty with transgressive flyers, their companies and their travel agent accomplices.

But in case the saber-rattling fails--as it usually has in the past--the airlines are also hyping, and heaping on, the advantages of big—ticket, unrestricted air travel. Not since the anything-goes mid-1980s have carriers so aggressively pitched the benedictions of paying the full fare.

United Airlines has packaged its new full-fare coach service enhancements as Business One. Northwest Airlines calls its program Fastrak. And at Continental Airlines the new watchword is BusinessFirst, the carrier's name for its newly upgraded international business class product.

The approaches diverge: The United and Northwest enhancements are mostly on the ground and so far apply to just a few domestic routes. Continental's carrot is airborne and farther flung. But similarities are telling: each is a package of value-added enhancements designed to wean frequent flyers from discounted air travel, and each has been assigned a brand-name identity, a tip-off that the carriers are getting serious and thinking long—term.

Business One service is offered on United flights from its hub at Chicago/O'Hare to six other airports: Boston, Minneapolis/St. Paul, New York/LaGuardia, Newark, Philadelphia and Washington/National. Launched in October, the program includes perks such as shuttle—like flight frequencies; convenient gate assignments and automatic ticketing machines at the gates; preboarding refreshments; reservation and itinerary confirmations sent by fax to the flyer; car—rental discounts; and a crew of specially trained airport personnel.

Northwest introduced Fastrak on the route. between its Minneapolis/St. Paul hub and O'Hare in November, 1991. Later this year, the airline is expected to extend Fastrak to the Detroit-LaGuardia run and possibly other business travel routes. Among Fastrak's perks: express check-in; a dedicated toll-free reservation number; a food-and-beverage buffet in the gate area; free newspapers; and, when there's a delay, Northwest promises to call ahead for you while you cool your heels in the airline's airport club.

Continental began rolling out BusinessFirst in December, promising "all of the comforts and service of international first class ... at business-class fares." In fact, the airline has scrapped its first class cabin and doubled the number of seats in its revamped business class on long-haul 747s and DC-lOs. The service in BusinessFirst includes new, French-designed electronic sleeper seats, a whopping 55-inch seat pitch, and better food and wines.

While they haven't launched brand-name enhancement packages, American and Delta also have begun focusing on full-fare business travelers again. Both now have business class on transcontinental routes, and both are shifting their advertising and marketing messages toward full-fare business travelers. American, in particular, is hawking the "value" of domestic first class. "We believe it's time to remind people of American's high-quality, premium products, both internationally and domestically," one of the carrier's executives recently told Advertising Age.

Will the full-fare service enhancements yield results, or are they just another stab in the dark by an airline industry that doesn't always seem to know where it's going? That depends upon whom you ask.

Most analysts agree that for carriers to prosper--and even, for some, to survive--they must lure more business travelers away from discount fares, even if that means first investing in the full-fare product. The theory sounds vaguely like president-elect Clinton's invest-and-grow plans for dispatching the national debt. As with the Clinton approach, this logic requires a sizable leap of faith.

Northwest, for example, had already announced the expansion of Fastrak to the Detroit-LaGuardia route last year only to pull it from the market at the last minute.

"Things are a little tight around here," a Northwest spokesman says of the abrupt about-face. "In this economy, it's hard to find the cash to invest in programs you would like to get going."

Continental, on the other hand, says it fully expects BusinessFirst to pay for itself by next year, despite a $20 million investment.

"Putting one additional paying business class passenger on each plane translates into an additional $12 million a year for us," says marketing vice president John Nelson. "It doesn't take very many passengers to recoup our investment."

Meanwhile, the airlines aren't relying just on a better full-fare product. In their desperation to make sure business travelers don't take advantage of the dramatically lower fares offered to leisure travelers, they have rattled their sabres concerning the use of back-to-back ticketing. This bit of fare gamesmanship entails the purchase of two deep-discount tickets. Even using just half of each ticket to construct a roundtrip--and circumvent the Saturday-stay rule--the combined discount fares are often substantially less than the price of an unrestricted full-fare ticket.

To dissuade business travelers from ditching their full-fare seats in favor of two cheap tickets--back-to-back-ticketing is not illegal, but violates their rules, carriers claim--airlines say they have recalibrated their computers to deny boarding to travelers using such tickets. They also claim they will bill travel agents for the difference between the price of a full-fare ticket and two cheap seats. And they recently changed the purchase restrictions on deep-discount fares to make back-to-back tickets harder to buy.

"The airlines can say or do whatever they want," says one travel agent in Los Angeles. "But business travelers are using back-to-back tickets because it makes financial sense. Larding on the perks for full-fare travelers is fine, but unless and until business flyers believe that the perks are equal to the price premium, nothing the [airlines] do Will stop travelers from trying to cut their travel costs."

This column originally appeared in Frequent Flyer magazine.