Buyers Pick American, TWA

<B> Buyers Pick American, TWA</B>

By Chris Davis

American Airlines topped the field among domestic carriers in an inaugural Business Travel News survey in which travel buyers rated the ease of use of airlines' group fare programs. It finished first overall and among corporate travel managers, and a close second among travel agents.

Continental Airlines was the choice of the agents and second overall, but was far less well regarded by corporate travel managers.

On the whole, buyers hammered the airline industry for its failure to deliver workable programs for the group market. Asked to rate the ease of use of each airline's group fare program on a scale of one to 10, travel managers gave the airlines an average score of only 6.3, while agents were even less forgiving, offering a paltry grade of just 5.5.

American, which travel managers gave a 7.2 rating, was followed by Trans World Airlines, United Airlines, Delta Airlines and Reno Air, respectively, though only 20 percent of corporate respondents said they have ever used Reno's group fare program. Continental finished eighth, with a 6.1 rating.

Among agents, Continental's rating of 6.8 set the standard, followed by American, TWA, Delta and Southwest.

TWA led the international group programs overall, though travel managers rated Alaska Airlines' international group fare program as the easiest to use, giving it a score of 8.0. It was followed by Qantas Airways, Alitalia, TWA and Japan Airlines. Agents again rated Continental the highest, 7.5, for its international group fares program, followed by TWA, KLM Royal Dutch Airlines, American and United.

Industry watchers expressed mild surprise at the order in which the airlines were ranked, but not at the poor rankings for the carriers as a whole.

"TWA jumped out at me; I would not have rated them so high. I would say American is number one, Continental is number two and Delta is number three," said Bill Boyd, president and CEO of Sunbelt Motivation & Travel of Dallas. Boyd sits on Continental's advisory board, but also "is a customer."

Boyd said he finds the three airlines mentioned very accessible to the group market, for which they have set aside specific resources. "You can actually get a name contact and develop a relationship with somebody when you pick up the phone. That's important. American is very good at that, so is Continental. Delta's not as good, but they still have a very good group department," he noted.

Others, though, felt the airlines were not nearly as efficient as they could be in accommodating group and meetings travel.

"It's not always easy to get concessions for our clients from the airlines in a timely manner, and that could relate to several airlines," said Lynne Tiras, president of International Meetings Managers of Houston, an independent meeting planning firm. "You're dealing with middle management, and it's not always easy to get a hold of those people."

Joan Eisenstodt, president of Eisenstodt Associates, a Washington, D.C.-based conference consulting and management firm, took it a step further, questioning the airlines' basic commitment to the group market.

"I think the airlines really don't want to do this and I'm surprised they're still doing it at all," Eisenstodt said. "I think the dissatisfaction on the part of planners is due to the fact that they're finding this out."

The problem for many meeting buyers is that it's very difficult to obtain convenient tickets under the terms of group fare programs. "I would guess that the same way airlines are controlling the number of seats in any particular fare category, any particular market segment, or for upgrades or free tickets, they're also restricting the number of fares that can be used for meetings," she said. As a result, planners often can't get the seats or group fares they need on a wide variety of flights.

But the low overall ratings, which were echoed in other areas of the survey (<I>BTN,</I> Nov. 2), may have less to do with the actual performance of the airlines than with a general resentment of the industry as a whole.

"Historically, when the economy's great, the transportation stocks are doing very well and airline profits are at an all-time high, it doesn't really make any difference what the airfares are," Boyd said. "There's a perception from the people doing the buying that the airlines are making too much money--and then, they take a beating in other areas."

Before tabulating the totals, BTN factored out the surprisingly large number of "rage votes" that gave zeroes to some or all of the airlines in every facet of the survey. Boyd wasn't surprised at those votes: "95 percent of corporate travel managers in the United States say that the airlines are ripping them off," he said.

Tiras agreed that the buyer's unhappiness with the airlines and the typical air travel experience could have led to the weak ratings found in the survey.

"It's not a good experience, and I blame the airlines," Tiras said. "People aren't happy travelers these days. Airlines are packing them in and the comfort level is way down. Everybody I talk to thinks the same way. There's an overall dissatisfaction, and maybe that reflects against all the airlines."

But some said the dissatisfaction with group programs eventually may help them to go the way of the dinosaur--a path down which the airlines seem to be heading.

"Dealing with groups is not a priority for the airlines," Eisenstodt said, "and I'll guess they are looking at how they're going to handle this. Maybe in the same way they've greatly downsized agent commissions, group programs might go away too. I think the airlines don't want the hassle."

That wouldn't necessarily be a terrible event for meeting buyers, she said, many of whom already have given up negotiating group fares with the airlines. "With the Internet, individual travelers want to book their own flights and research their own fares, and they can probably get cheaper fares than even the meeting planner."

As for the disparity in the perceptions of travel managers and travel agents, particularly in Continental's case, Boyd noted that the two groups are looking at the programs from different angles. "Perhaps the travel managers are more apt to look at the deals they are able to negotiate, while travel agents look more at the individual travelers they book," he said. That could lead to very different perceptions of the same program.

The first-of-its-kind survey was conducted for BTN by Back Associates of New Haven, Conn., in August 1998, and completed by 70 corporate travel managers and 45 travel agents. Asked to grade only those airlines with which they had done business in the past year, respondents ranked the carriers on a scale of one (poor) to ten (excellent) in nine categories addressing services to the corporate travel manager and four relating to services to the traveler.

On the international charts, readers were asked to evaluate only the international operations of any U.S. airlines about which they were responding.

R.I.C. Associates of Melville, N.Y., tabulated the results.