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Strategies & Market Trends : Sharck Soup

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To: Sharck who started this subject10/5/2001 8:05:15 AM
From: Jim Spitz  Read Replies (1) of 37746
 
Northwest cuts fares to entice leisure travelers
Donna Halvorsen
Star Tribune


Published Oct 5 2001

Northwest and other airlines on Thursday announced global
fare sales, the first major cuts since the Sept. 11 terrorist attacks
left carriers with empty seats and huge revenue drops.

Northwest reduced fares by 20 to 40 percent on many domestic
and international flights booked by Monday. It also offered
special $188 round-trip fares to the East and West coasts. And
Northwest made new overtures to its 3 million frequent fliers,
including double miles on flights taken by Nov. 15.

The fares unveiled Thursday are the lowest Northwest has
offered this year, said spokesman Kurt Ebenhoch.

"We feel we've put a good schedule into place, that we're
operating reliably on a daily basis, and we're hoping to entice as
many of our customers to the skies as we can," he said.

Delta was first to announce a fare sale Thursday. Northwest
followed a few hours later.

By the end of the day, nearly every airline had launched a sale,
said Jeff Katz, chief executive of 0rbitz.com, the online travel
agency owned by Northwest, Delta, American, United and
Continental.

"It's a very traditional airline-industry phenomenon," Katz
said. "One airline comes out with an attractive promotion. The
others really have to match it. I personally think it's a great
thing to do, because they're flying now, and that's their business,
to come back and fly. Our shopping on the site suggests people
want it."

Tom Parsons, who monitors fares for online travel agent
Bestfares.com, called the fare sale a "a blow-out, super sale."

A seven-day advance purchase is required. Terry Trippler,
airline expert with OneTravel.com, said stipulating seven days
will get people back in the air more quickly.

Regarding the fares, he said, "For the pleasure traveler, this is
probably as good as it's going to get, and it's not bad. There are
some people who won't travel at any price right now, and there
are a lot more people who will travel if the price is right. And to
many people this will be the right price."

Trippler said travelers still need to compare prices before
buying. He said he checked a Nashville-to-New Orleans trip
and found a $99 fare through Houston on one airline and an
$84 nonstop fare on another.

Fare sale terms

Northwest's bargain fares are good for travel within the United
States through Dec. 15 and for international flights through
March 15. Blackout dates apply around holidays.

The $188 round-trip fares are available through Dec. 16 for
travel from the Twin Cities to Los Angeles, San Francisco, New
York City and Washington, D.C. They must be booked online at
nwa.com by Tuesday.

Northwest also announced Thursday that members of its
WorldPerks program now can earn free domestic trips with
15,000 miles instead of 20,000, and they'll get double miles for
travel. Both offers end Nov. 15.

When planes have been at or near capacity in the past,
frequent-flier seats have been limited. But now, Ebenhoch said,
"because our flights are so much less full, customers will have a
much easier time getting those seats."

Northwest said its planes were about 56 percent filled last
month after the attacks, compared with 76 percent before the
attacks.

Bargain hunting

Before the airlines cut fares Thursday, many Twin Cities
residents were searching for bargain flights. Emily Reichert, a
23-year-old photographer from Apple Valley, wasn't terribly
eager to fly after Sept. 11, but she was eager to see a friend in
London.

She talked to her family's travel agent, who said she couldn't
find a flight for less than $600. She scoured the Internet, where
the best was $430 before taxes. When she saw a $255 fare in a
Hobbit Travel newspaper ad, she and two friends took the
plunge and are London-bound. With taxes, their tickets cost
$350.

Reichert admits to being nervous but she's not going to let fear
run her life. "Obviously, if there are more attacks, or there's a
blatant threat to flying, I'm not going to go," she said. "[But] I
put too much value into my family and friends to lock myself
away and not see them and not continue to live my life. I'd
rather die having a wonderful time in London than die of fear
in my house of getting anthrax or something."

George Wozniak, president of Hobbit, a discount travel agency
in Minneapolis, said travel is coming back. His business is 90 to
95 percent of normal for this time of year, and he called back
some employees four days after they were laid off. "That's how
hard it was to predict what would happen," he said.

Wozniak has dealt with a crazy quilt of fares recently as airlines
added one-shot fares several times a day.

"Last week we had a round trip on Delta to Tampa for $50," he
said. "It was in the system to be booked for one day. ... The next
day Delta came in with fares to Los Angeles and Seattle for
$100 round-trip. Then there was a San Francisco fare on
United for $220, then a New York fare for $128."

Hot deals seemed to elude one Twin Cities man, but he caught
one this week. When he heard about a $52 round-trip fare to
Tampa, he got on the phone and booked it.

Later he called back, and the same Hobbit agent found him a
seven-day cruise on a reputable cruise line out of Tampa for
$339. He booked it. "I don't even know where we are in the ship
or a darn thing, and I don't even care," he said.

He asked not to be identified because the trip is an anniversary
surprise for his wife. "Sometimes you've got to be in the right
place at the right time, right?" he said.

-- Bloomberg News contributed to this report.

-- Donna Halvorsen is at dhalvorsen@startribune.com .

© Copyright 2001 Star Tribune. All rights reserved.
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