In just this last week, Air France offered me an exclusive deal of 50 per cent discount on hotels worldwide if I signed on to something new. British Airways tried to entice me to a new level of membership. Lufthansa also had some special deal that I've forgotten.

These airlines try to make me feel special because I am a member of their frequent flyer clubs. You see, membership has its privileges, as the slogan of American Express often reminds us.

The problem is that I am not such a frequent flyer. It takes me awhile before I get to any significant level of benefits and that frustrates the airlines that are constantly selling me dreams and trying to get me to act. I am also not a very smart flyer because I buy a ticket based purely on price and then try to get the benefit of the miles travelled.

Each airline wants to build my loyalty so that I would choose to fly with that particular one to build my miles balance. My other problem is that when my miles accumulate to a level that entitles me to receive some benefit, I promptly use the miles to claim it, and am back at the bottom and begin my roller coaster ride.

Games played with tags

This cheap and opportunistic strategy of mine has its drawbacks. Take Air France, for instance. That airline is a prominent member of the Skyteam alliance and it is very careful about what you get at each level. For instance, when I am at their basic membership of the ‘Ivory' level, I get luggage tags of the appropriate colour.

When I move up to the next Silver level, I get another new set of tags of the appropriate colour. You see, Air France is keen that my luggage also gets treated appropriately. So, with an Ivory tag, the bag is probably thrown about, but with a Silver tag, it is, I'm sure, carefully placed on the conveyor.

With a Gold tag, the baggage handler will perhaps wear gloves before he or she touches may bag. With a Platinum tag, they probably make sure nobody steals anything from the bag during transit.

But when I use up my miles, I drop suddenly from silver to ivory. I do not replace the tags on my bags and feel guilty if I am cheating, but the bags get treated better than I am. British Airways has been watching me for some time. They noticed that for years I have been languishing at the entry Blue level, never reaching the heights of Silver or Gold. So, to motivate the likes of me with tantalising benefits, they have introduced a new category of Bronze (between Blue and Silver). And by moving to Bronze I would be entitled to select my seat seven days before departure! Wow! Of course, that does not mean that the seat I want will be available.

In the hyper competitive market place that the airlines operate, they are trying every which way to build their profits. Loyalty programme is an important one. The big benefit of moving up the ladder of airline membership is the use of airline lounges. These are turning out to be a new ground to compete on and many long-haul airlines are investing heavily to upgrade the facilities they provide at major airports. In these lounges, you are away from the hoi polloi, and get to munch on free sandwiches, hot entrees and desserts. Elite passengers, who account for about 20 per cent of long haul passengers, contribute about 50 per cent of revenue.

Thanks to the Internet which has put ticket price information on an easily comparable format for the customer, airlines have started focusing on fees for services as a major source of profitability. Many airlines now charge extra for that baggage that you check in.

Minor privileges

There are other privileges with membership, such as the ability to board the aircraft early and grab that overhead luggage space. One airline in an airport I was in recently wanted to make it clear what I was missing by having two lines to enter the jetway to the aircraft.

One line had a red carpet that was just about six feet long, so the privileged members got onto the red carpet and had a brief moment when they felt they were entering the auditorium at the Cannes film festival, before they got off onto the linoleum again. But there was a swarm of people who seemed to qualify.

The airline staff member took several seconds to announce the number of people who could now come to the red carpet. These were people who had crossed 100,000 miles, were at different levels of airline club membership, who had some particular credit card, and so on. And only after that crowd got on were even the first class ticket holders invited to come.

The rest of us were asked to step onto the other side, which I think had a blue carpet strip, and needless to say, my ticket was in a zone that was called last.

I had to sit in the middle of a three-seater and spent the rest of the flight avoiding the eyes of those on either side of me who had privileges — they got the window and the aisle seats by choice.

(The author is professor of International Business and Strategic Management at Suffolk University, Boston, US.)

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