David J. Danto


Business travel thoughts in my own, personal opinion




eMail: ddanto@IMCCA.org      Follow Industry News: @NJDavidD


Comparing The Customer Experience In The Airline and Hotel Industries 

I travel for a large portion of my job.  So do thousands and thousands of others.  I am a frequent customer of airlines and hotels, and boy, are they different.  Yes, there are the obvious contrasts – that one is on the ground and one is in the sky, and mistakes at one could be deadly while not so much at the other.  My perspective here however is how the circumstances of each affect the frequent customer’s experience.  In that context these two industries are about as different as the ground and the sky.

The US airline industry has limited resources.  There can only be a fixed number of take-offs and landings in a day, and a fixed number of gates at airports.  (I’ve written before about how we’ve allowed the airlines to manage this limited resource – which actually doesn’t belong to them – to our detriment, but that’s not the point here.)   The US hotel industry has no such limitations.  Big and small firms alike can open whatever number of properties they desire.  Buying a plot of land and building a new hotel is far easier than creating a new airline.  Because of this, there is much more competition between hotels than airlines – and boy, does the difference come through in the customer experience.

Most of the benefits offered to frequent airline flyers nowadays are just meant to ‘ease the pain’ of air travel.  Think about that.  The airline’s elite strive to board before there is no longer room for their carry-on bags, and they compete for a very limited supply of upgrades which (if awarded) only gives them the privilege of flying in a seat area that hasn’t become inhumanly small.  These and other benefits were not achieved by improving the customer experience in this service industry, but rather by cheapening the experience of the majority of passengers, and not removing what used to be standard experiences from the elite flyers.

This is in contrast with the hotel industry, which actually has to improve the user experience to compete with other hotels.  Mind you, not all properties are strive for this – as there are still plenty of bad ones – but for the most part the larger hotel chains do really attempt to improve the customer experience to satisfy their guests.

On my trip last week I was number 19 on the upgrade list on my outbound flight and number 16 on the return – this for a first-class section that only holds a total of 16 people and only had one open seat.  Contrast that with the property I stayed at that gave me an upgrade to a corner-view suite.  One company dangles but never delivers the promise of service that hasn’t been degraded, the other actually delivers a significantly improved experience.

When things go wrong – and the reality of frequent travel is things do go wrong – we can also compare the customer experience in dealing with the two types of firms.  The airlines will go out of their way to tell you all the reasons why the problem wasn’t their fault.  It was the airport, or the TSA, or the weather, or a needed repairs, or something that they’re not responsible for.  Write in to the airline with a complaint and they’ll explain their absolution to you, maybe throwing you a bone of a coupon that offers a few dollars off your next flight.  On the other hand, if you write into a hotel chain and describe a bad experience, it’s much more likely that you’ll receive a full refund and a sincere apology.  Why the difference here?  Because the hotel chain knows you probably have other options and the airline knows you probably don’t. 

In fact, airlines intentionally cut-back on the frequency of service to reduce the supply of service and therefore increase the demand for it, inflating the prices up-to what the reduced market will bear.  The recent grounding of the Boeing Max aircraft is certainly a safety concern and black-eye for Boeing (covered in-depth better than anyone here by the VOX news service) , but I wonder if the US airlines effected really care?  A temporary situation that makes airline seats even more scarce is exactly the kind of situation that they can use to further decrease supply and increase prices.

How do we fix this situation?  Personally, I’ve gotten-off the false promise loyalty train with the airlines, and just use cash to buy whatever the best seats / fares are for me.  As I’ve described before, I’ve switched from using the airline credit cards to independent ones with better benefits, and no longer expect the airlines to do the right thing by me or any of their frequent customers.  I strongly suggest that others do the same.  Only by reducing the revenue that airlines make from their sales of frequent flyer miles to banks will we ever get them to make these miles and benefits valuable again.  I do however maintain my loyalty to my chosen hotel chain (Hilton), as they’ve shown by their actions and their responses to issues that they return and therefore deserve my loyalty.  Just as I wrote in my blog on loyalty two years ago, our travel service providers need to realize that loyalty is a two way street, and if they don’t, they’ll be hit with an inevitable downturn, and probably say to “Wall Street investors that no one could have seen it coming.” 

This article was written by David Danto and contains solely his own, personal opinions.

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