Friday, September 3, 2004

New Delta fares boost ticket sales

By James Pilcher
Enquirer staff writer

Two weeks after Delta Air Lines unveiled its new fare structure for Cincinnati and Northern Kentucky, prices have held steady, and the airline says the program has spurred additional local traffic.

Delta chief executive officer Gerald Grinstein told workers in an internal memo that local bookings rose 69 percent from a year ago in the first four days after the launch and that local bookings on were up 111 percent.

Airline officials would not provide any more updated figures but said they are pleased with the overall response. Cincinnati/Northern Kentucky International Airport ranked as the second most-expensive airport in U.S. Transportation Department findings, and Delta controls more than 90 percent of the traffic at the airport.

Still, area travelers, accustomed to navigating the complex process of finding the cheapest fare, say the Delta's SimpliFares program might need further simplification.

"My beef is that they call it simple, but it is as complicated as ever to find a cheap fare," Joe Rhodenbaugh of Indian Hill said. He said he was trying to book a trip for November but saw the fare change three times in the space of a week before he was able to make reservations.

"Even though they say that there are only six fare codes, they are still playing daily with the prices, and that makes it frustrating," said Rhodenbaugh, president of a Madeira manufacturing company.

Delta has said the fares are subject to supply-and-demand factors as well as fluctuating market conditions as fuel prices remain high.

An Enquirer review of several fares from Aug. 19, the day SimpliFares was launched, and Thursday, showed that Delta appears to be sticking with the new fare plan.

Still, some passengers such as Rhodenbaugh have expressed confusion over the new program stemming primarily from two sources.

First, Delta continues to rely on "yield management" despite the simplification of the fare structure.

That program is an attempt to maximize revenue on each flight by allocating only a certain number of seats at a certain price based upon previous travel patterns. That's why a fare can rise overnight - even when the trip is still more than 14 days away - if low-priced seats have sold out and the airline is preserving seats for last-minute travelers.

Second, SimpliFares was supposed to draw travelers back from surrounding airports such as Dayton and Louisville, which are served by low-cost carriers. But Delta's new fares in some cases are still more expensive.

In introducing the new fare structure, Delta acknowledged upfront that some prices from Cincinnati/Northern Kentucky would still be higher than at competing airports. However, the airline emphasized that the convenience factor for passengers who no longer would need to drive as far as Louisville or Indianapolis for a much lower fare would be attractive.

The fare changes are in part a response to the trend that has seen 28 percent of Cincinnati-area travelers - almost 2,500 a day - use one of five surrounding airports in the region, according to a study commissioned by local airport officials last November.

Cincinnati/Northern Kentucky International aviation director Bob Holscher said it is too soon to tell whether the fares have had a dramatic impact on local traffic, but he said he has received only positive feedback.

Officials at the Dayton airport, which draws many travelers from the Cincinnati region, also said there was no way to determine impact on traffic there. Dayton airport spokeswoman Sharon Sears also said Delta and AirTran both are adding nonstop flights to Florida in November and December, which could continue to make the airport attractive.

It would take a price difference of "less than $50 for me to use Cincinnati over Dayton," Maureen Schomaker of Springfield Township said. "And that still has not improved to the point where I will always fly out of Cincinnati, but at least I will now consider it."

But Delta also said leisure fliers such as Schomaker were not the direct target of SimpliFares and the accompanying $2 million-plus media campaign. Business fliers are the prime target.

And several area travel agents and business travelers say they are seeing a big difference in such Delta fares, though it might be too early to spot a shift in travel patterns.

"We're not seeing any diversion in travel patterns and probably won't for a while," said Vicky Mary, owner of the Hyde Park travel agency Victoria Travel.

One of Mary's business clients, Joe Isidore of a Blue Ash biomedical review agency, said he saw his fare to Washington, D.C., drop more than $300 and that he saw another positive impact. "We host a national conference, and I could see getting more speakers in here because the air fare is more affordable," Isidore said.

One simplification has been very popular, at least with business clients of AAA Cincinnati. SimpliFares lowered the change fee to $50 from $100, and AAA spokeswoman Sandra Guile said many business customers have exchanged their tickets for lower fares, saving money even with the change fee.

"We are also seeing people both in business and leisure markets considering Cincinnati when, before, it wasn't even an option because of the price differences," Guile said. "And a lot of our business travelers are excited that Cincinnati is an option again."


New Delta fares boost ticket sales
Delta's plan due Wednesday
Ohio tax credit struck down
Union for 8,500 Kroger workers pitches contract
Sassoon settles suit with P&G
Contract talks key to budget for symphony
Retail sales hit wilting August
Economy sluggish in spring quarter
Cintas plans labor report on suppliers
Ditch spyware first, Microsoft advises
Stocks rise, investors turn optimistic
American Airlines adds service fee for ticket purchases
Business digest
Tristate summary