1) As you know, a flight's price is tied to underlying fare buckets. More demand, higher price. How do these flight subscriptions integrate into the airline's revenue management model? I can't imagine they offer last seat availability so is a subscriber set up for immediate disappointment when they realize they cant use their free flight on Thursday before Christmas even though it is available for purchase?
I feel like this scenario is the true devil in the entire flight subscription offering. The moment a consumer can't access their promised value prop they will cancel and it will be very difficult to regain them. Conversely, setting expectations that your subscription is actually a subscription to flights that are lightly booked is an entirely different value proposition.
2) On the frequent flier end of the spectrum, US airlines with revenue-based frequent flier programs are much, much closer to a subscription offering for their existing frequent fliers and one wonders why they haven't made this logical jump already. For example, United requires $24,000 in pure spend to make 1K status this year. Why shouldn't I be able to subscribe to 1K status for $2000 a month right now and receive all those benefits and a $2000 spending credit for flight purchases in the month? Seems like a no-brainer.
Mauricio,
Great deep dive! A couple of questions:
1) As you know, a flight's price is tied to underlying fare buckets. More demand, higher price. How do these flight subscriptions integrate into the airline's revenue management model? I can't imagine they offer last seat availability so is a subscriber set up for immediate disappointment when they realize they cant use their free flight on Thursday before Christmas even though it is available for purchase?
I feel like this scenario is the true devil in the entire flight subscription offering. The moment a consumer can't access their promised value prop they will cancel and it will be very difficult to regain them. Conversely, setting expectations that your subscription is actually a subscription to flights that are lightly booked is an entirely different value proposition.
2) On the frequent flier end of the spectrum, US airlines with revenue-based frequent flier programs are much, much closer to a subscription offering for their existing frequent fliers and one wonders why they haven't made this logical jump already. For example, United requires $24,000 in pure spend to make 1K status this year. Why shouldn't I be able to subscribe to 1K status for $2000 a month right now and receive all those benefits and a $2000 spending credit for flight purchases in the month? Seems like a no-brainer.
Thanks.
-Alex