January 5, 2015
Airlines should balk at fare “cheats”
Innovation can be awesome. It makes something worse into something better. Unfortunately, innovation also costs whoever was doing it the “old way.” So, when it comes to changes in the marketplace, there is no win-win scenario. Someone is always left holding the bag. They are also left with a choice. Do they innovate along with the market…or do they try to stop history in the making?
The past provides countless examples of both approaches, as well as the PR cost of trying to stem the tide of progress, but some companies refuse to learn from it. A recent federal lawsuit has shined the spotlight onto the practice of “hidden city” ticketing. This involves buying an airline ticket between two cities with a connecting flight, but ditching the rest of the trip. Harmless? Not so, say the airlines.
Travel gurus beg to differ. They are calling the practice “smart” and “cost conscious.” Airlines counter that they are losing revenue they could have earned by filling empty seats on those flights. Given the standard esteem with which consumers view airlines, guess which side is getting the most support?
It’s no secret that nonstop flights command a premium price. Airlines know that time and convenience conscious consumers are willing to pay more to avoid the frustration of layovers, lost luggage, and the innumerable delays that seem to arise from the otherwise simple practice of getting off one plane and getting on another.
Because of both what some consumers view as price gouging and the temptation to save a few bucks, many see nothing wrong with hidden city booking techniques. Then again, the airlines are legitimately losing money, so they do have a grievance. But regardless of how that grievance plays out in court, the airlines have already ceded ground in the PR battle.
Other airlines have chosen to take the, pardon the pun, high road. Instead of suing, they are enacting penalties on those who skip out on the last leg of flights. Consumers caught using hidden cities risk losing frequent flyer miles and, in some cases, repeat offenders risk having their accounts closed altogether.
While this penalty may not mean much to the occasional flier, it could certainly give the business traveler pause. This is a solution most consumers would view as fair and viable. Try to skirt the system and pay a penalty. However, by pursuing this lawsuit, the airline in question has not only made millions more people aware of the issue, they have painted themselves as the enemy of cost-conscious customers.