Southwest Airlines Co. has redesigned its frequent passenger program to add rewards without dates blackout and redemptions for international flights on other carriers.
The first major revamp of the loyalty plan rapid rewards since its inception in 1987 should add "hundreds of millions" dollars per year in income, Chief Executive Gary Kelly said yesterday a Conference at the headquarters of Southwest Dallas.
To the Southwest, the largest company air cheap spent nearly 100 million dollars on the project and is designed to gain new customers and deepen linkages with existing business travellers who typically pay higher prices. Carrier unveiled a Web site for passengers today to explain the changes to take effect March 1.
"If we get our fair share of frequent fliers, the opportunity is huge," said Kelly. "We are very confident that this is a good investment."
Members of rapid rewards now receive credit for each flight and earn a free flight after accumulating 16 credits. System rewards most long flights with more credits and allows passengers to accumulate credits beyond 16.
"As soon as you win a prize, you are free to Southwest", said Kelly. "It is not encouraging loyalty."
The new program gives points, based on the price of the ticket and the category of fares, which can be accumulated for the biggest prize. Points per dollar rate increases with the fare type.
No Expiration
There is no expiration date as long as the account remains active within a period of 24 months, and there was no date of blackout on redemptions are prohibited and limitless pricing redeemed per flight, said Ryan Green, Senior Director in the South-West of loyalty.
Points can also be redeemed by a provider third for international flights and those in Hawaii, hotels and rental cars even if SW flies only in the 48 contiguous States. Points can be purchased for the new programme closer to the grant. Southwest also adds a second category elite-flier for those who travel more often which includes additional benefits.
Even with the most generous rewards, sud-ouest Southwest isn't expected price repurchases exceed their current 7 to 8% of the total revenue passenger miles, Kelly said. Expected permanent fresh southwest of new plan differ significantly from current levels.
The program structure more differentiates southwest of competitors, said Dave Ridley, Vice President of marketing and revenue. It is the only big U.S. carrier who charge for checking a bag of first and second or make changes to a purchased itinerary and there is no assigned seating.
"We have the best policies to bag best policies change, the best customer service," said Ridley. "Now, we have the best frequent passenger program." It is to bring new customers we. »
To contact the reporter on this story: Mary Schlangenstein in Dallas at the maryc.s@bloomberg.net
To contact the editor responsible for this story: Ed Dufner at edufneror jbutters@bloomberg.net
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