American Airlines scored the strongest performance among the mainline hub-and-spoke carriers the ninth Business Travel News Annual Airline Survey, with a 3.24 ranking on an ascending scale of one to five—just a fraction of a point below Southwest Airlines' winning 3.27 score
(see story). While Southwest won the survey largely because of its overall price value and quality of customer service, American led the other categories in the survey.
American Airlines took first in all categories relating to negotiating, leading in flexibility to negotiate meeting and transient pricing as well as services and amenities.
Furthermore, the carrier led in areas of relationships, from the high ranking of its account managers to the quality of its communications. American Airlines vice president Frank Morogiello said the carrier's relationships with corporate travel buyers have driven its performance. "We still believe, if we're calling on the customer, that the relationship—the big 'R' relationship—is what matters and makes the difference," Morogiello said. "Even when things go wrong, that's when your true colors come out. You have to get value included: How our clients have been treated in the good and the bad times, how we account manage, how we cover the globe with our customers. If you have an issue anywhere in the world, you can find out what's going on and move on it. That's the stuff we've worked hardest on."
American also posted the highest score in the availability of contract performance data, representing the carrier's recent shift to the Prism system, the dominant data tool among domestic carriers.
Furthermore, to bolster its customer service, American has folded its premium services team under the sales flag to further customize the experience for its corporate travelers. This provides a high-touch, personalized service that a Southwest can't match, Morogiello said. "We have a whole team at the airports in premium services that directly reports through sales to keep an eye on our top travelers," Morogiello said. "We make sure when something breaks, we're there to help fix it for them. That's a competitive tool that the other guys don't have. They may have it, but it doesn't report through sales." American said the number of deals last year held steady at around 2,000.
Continental Airlines ranked third overall with strong marks for overall price value and customer service. The carrier finished a close third to American Airlines' second, but witnessed a drop from its placement last year when Continental ranked number one.
"It looks among like the network carriers, we finished first in quality of customer service and overall price value, which is great," said Continental vice president of North American sales Monisa Cline. "Customers see the value in the investment we've made in our product. We continue to serve meals, continue to have pillows and blankets and magazines. We've also invested in our facilities a lot."
Cline said the carrier has maintained its focus on the corporate market, keeping its salesforce intact and dedicating teams to call on business customers of all sizes—"Whether they're small, medium or large, we do have a team that works with that group of customers in each market." Cline said that Continental in the past year has added to its salesforce, bulking up the carrier's roster of field sales managers. Cline said that the number of corporate contracts the carrier has offered has remained flat over the course of the past year.
Continental is sharpening its focus on an area increasingly important to the mainline carriers: international. "We're taking on some new Boeing 777s in the spring," Cline said. "We'll be taking on the 787 the following year, so international expansion is definitely on the horizon."
United Airlines finished in the middle of the pack with an overall score of 3.04. Like many of its competitors, the carrier saw a modest decline in its overall performance from last year, but managed to improve its performance relating to flexibility in negotiating transient pricing and quality of complaint problem resolution, while holding steady in its quality of customer service.
The carrier last year vaulted to third place after finishing in the bottom of the pack in 2004.
While Northwest Airlines finished in the lower half among the domestic carriers with an overall score of 2.95, Northwest vice president of sales Steve Sear was heartened to see the carrier jump in the rankings—moving from last among its mainline peers last year to fourth, ahead of Delta Air Lines and US Airways. In addition to moving upward in relation to its competitors, Northwest also saw a level of improvement over its standing from last year. "We're pleased that Northwest improved year over year in nearly every category. No other airline achieved this," Sear said. "If you dig into it, we improved in seven of the nine categories."
Northwest ranked above the average in the relationship value with account managers and sales reps category, which Sear said was a focus area in the course of the past year. "We're particularly proud that we improved more in that category than any other of our network peers. For Northwest, adding value to these partnerships has been a key focus for us. We've realigned our sales portfolio to enable more sales manager visibility and focus on our corporate customers' specific needs. You can see that the customized attention is evident in these survey results."
Compared with last year's results, Northwest also saw an improvement in the category of airline communications.
"When you're relentless in your communication and support from our sales managers, they are in effect delivering that trust and adding value to the customers," Sear said. "We even changed our training program that enables a more consultative-based approach with customers. The bottom line: Our teams remain visible and are committed to communicating both the good and bad news."
US Airways took the bottom slot among the carriers represented in this year's survey, with an overall score of 2.76. America West and US Airways last September officially cemented their merger and the two carriers were represented as one entity for this year's survey. Last year, America West averaged a 3.11 score and US Airways had a score of 3.08.
Positioning itself as a low-cost carrier since last year's merger, the new US Airways significantly has reduced the number of contracts offered to corporations and has made deep cuts to its salesforce. While several US Airways clients from large companies said the move represents a degree of abandonment of the carrier's corporate base, the airline said that as an LCC it is offering fares that are historically low—with or without a contract.
Travel buyers from such large travel-purchasing organizations as Lucent and Lockheed Martin, among others, noted a dwindling sales staff and in many cases a less responsive US Airways when it comes to corporate clients.
The carrier's newfound hard line in negotiating with buyers is reflected in the survey, as the carrier finished last in all things related to negotiations: flexibility in transient, meetings and amenity negotiations.
Delta Air Lines performed better than US Airways and finished barely behind Northwest, with just a fraction of a percentage separating the two bankrupt carriers' total scores. The carrier had a better than average ranking in its flexibility in negotiating services and amenities, but fell behind the bulk of its peers in all other categories. Delta is in the midst of a major international expansion and also has been busy refreshing its product.
Delta COO Jim Whitehurst said Delta is refocusing on the airline experience, particularly through efforts to make Delta more palatable to corporate travelers. "We're trying to create a customer-focused network," Whitehurst said. "I'm probably unique among senior executives at major airlines in that I was a premium flyer. In Chicago, I was platinum on American and executive premier on United. I moved to Atlanta and was platinum on Delta. I was a road warrior who traveled quite a bit. Part of the addition of new routes also is for ensuring that we serve the needs of our customers to get them where they want to go. For instance, in Atlanta we should serve any market that it is possible for us to serve nonstop, to give our customers the ability to fly nonstop. We've also done a lot of things with our schedule. For instance, in our hubs, where in any way, shape or form we can support it, we have added early morning departures to key business destinations, so that our business customers can fly on us."
While usage among survey respondents was too low to generate meaningful survey results, JetBlue Airways, Midwest Airlines, Alaska Airlines and Frontier Airlines all garnered strong finishes compared to the legacy carriers.
Mimicking Southwest's success in the overall price value category and achieving an overall ranking of 3.38, JetBlue's score would have placed it above all the other carriers. The carrier, however, remained ineligible from the final rankings, given that only 22 percent of the respondents have booked a meaningful amount of business with the carrier in the past year.
Known for its all-business-class product, Midwest Airlines also showed a strong finish, but garnered only 11 percent usage among the respondents. The carrier's final score of 3.24 was boosted by its high markings for customer service. Alaska and Frontier both finished with a final score of 3.16, but had usage levels in the teens.