Fare Deals

The desperate drive to slash costs and streamline operations at U.S. airlines during the past few years has affected group travel programs that have long benefitted meeting, trade show, convention and incentive planners. Are free tickets, guaranteed seating blocks and airfare discounts going the way of the biplane? Not quite, but cutbacks are afoot, and planners might find several of the changes unwelcome.
    “Because of financial troubles in the airline industry, some carriers have moved away from some group products,” says Mark Nickells, managing director for group and meeting travel with Dallas-based American Airlines. “And now, most people traveling as a group are looking for the lowest fare. You've seen that across the industry.”
    Indeed, changes to group offerings at some carriers have been dramatic - up to and including the entire elimination of meeting programs. Why? The so called “legacy” carriers (those that were around before industry deregulation in 1978) in general use a hub-and-spoke model of operations that has proved more expensive to run than the point-to-point model used by younger airlines. Worse for the legacies, their hungry low-cost competitors have largely suppressed airfares while an unyielding rise in jet fuel prices has nullified cost-cutting elsewhere by the industry's old guard. 
    “When you have the juxtaposition of historically low fares, which are at 1988 levels, and historically high fuel prices, every airline has a problem,” says John Heimlich, vice president and chief economist with the Washington, D.C.-based Air Transport Association. “You cannot fill half a plane, or even three-fourths of a plane, with 1988-level fares and expect to cover the cost of $72-per-barrel jet fuel.”
    Even low-cost carriers face the challenges of high fuel costs and sharp-elbowed competition. These harsh economic realities are not predicted to improve anytime soon: “Overall, the industry should post $1 billion to $2 billion in net losses in 2006,” says Heimlich. In light of these woes, following is an updated look at the products and services both legacy and low-cost airlines are offering to the meetings industry.

Alaska Airlines/Horizon Air
Group Travel Desk: (800) 445-4435
Horizon Air Group Travel Desk: (800) 547-3209
www.alaskaair.com

On Alaska Airlines, the country's ninth largest carrier (with hubs in Seattle; Anchorage, Alaska; Los Angeles; and Portland, Ore.), groups of 10 or more traveling together on the outbound leg of a trip may qualify for fare discounts, with the exception of some busy holiday periods.

American Airlines
Group & Meeting Travel Desk: (800) 221-2255
www.aa.com

American offers reduced fares for site inspections.

American offers one of the most comprehensive group travel packages in the industry, with a group travel desk and programs tailored to association meetings, company meetings and group incentive travel programs. 
    AA's Group & Meeting Travel programs for association, corporate and incentive events offer special savings and bonus discounts on published airfares for 10 or more passengers traveling to the same meeting or convention when AA is designated as the event's official airline. Attendees are granted a 5 percent discount on published fares, which applies to travel originating from various North American cities to a common destination in North America, the Caribbean, Europe, Latin America or the Pacific. 
    American also guarantees economical fares from various geographic zones of departure to a common destination for groups of 10 or more traveling to association or corporate events. These discounts run as deep as 40 to 70 percent off full, unrestricted coach fares. However, zone fares do not require a Saturday-night stay, so they're best suited to midweek meetings and events. Zone travel fares are valid for flights beginning in the United States and Canada and destined for North America, the Caribbean, Europe, Latin America and the Pacific. 
    Negotiated rates for blocks of seats are available, whereby a planner may negotiate a rate with the group travel desk over the phone. “You will receive a contract within hours,” says Nickells. “A signature is not required for discounts and zone fares. A block space agreement requires a deposit, and you must sign and return the agreement.”
    Event, meeting and convention planners also can secure reduced-rate fares for site inspections, with the discount based upon the meeting's potential to generate business for the airline. 
    Furthermore, association staff members may qualify to earn airline tickets based on the number of travelers booking under that association's group account (STARfile number). If more than one event is booked, association staff ticket allocation will be based on accumulated passenger totals. 
    For bookings made up to 11 months in advance, groups of more than 10 can block space together when traveling to the same city. Along with the break on fare, such groups can assign passenger names 30 days prior to departure, are allowed one name change per ticket, and do not require a Saturday or minimum stay.
    American also offers a service whereby groups of 10 or more passengers booked on a single reservation can check in with a self-service machine, thereby avoiding lines at check-in.

Continental Airlines
GroupWorks: (800) 525-1700
MeetingWorks: (800) 468-7022
www.continental.com

Houston-based Continental Airlines, the fifth largest commercial carrier in the United States, has hubs in Cleveland, Houston and Newark, N.J. 
    The carrier splits its Group & Meeting Travel operations into two parts: GroupWorks, designed for 10 or more passengers traveling on a common flight to the same destination; and MeetingWorks, for 10 or more flyers traveling to a common event from two or more cities of origin. 
    GroupWorks offers planners special pricing and discounts available when an online bid request is placed at www.continental.com/contact/group/group
works.asp. After the planner completes a form, an e-mail is sent back within one business day containing a price quote. Information on confirming the reservation and booking a flight with guaranteed seating and fares also is contained in the e-mail.
    When the meeting dates arrive, Continental provides special service for groups of 10 or more during travel, including a group coordinator at both the departure and arrival airports to assist with details like check-in and baggage claim. Groups traveling under the GroupWorks program also receive priority check-in, boarding and baggage claim. 
    Continental's MeetingWorks also offers discounts for 10 or more people traveling to a common event or meeting from two or more cities. In addition, a planner's organization can earn travel rewards, including roundtrip travel certificates and upgrades. The online form for soliciting a bid from MeetingWorks can be found at www.continental.com/contact/meeting/meetingworks.asp.
    With MeetingWorks, discounts for attendee fares are based either on global zone fares or a percentage off published fares, depending on the choice of the planner or travel organizer. 
    Once travel is booked, Continental gives the planner using MeetingWorks a template to create an informational flyer for attendees that includes the meeting name, date, city and discount rate. The airline also provides planners with copy-writing ideas, airline photos and logos for use in promotional materials. Assistance to travelers is provided along the same lines as GroupWorks. 
    About two months after the event, Continental follows up with a notification of the organizers' earnings, based on attendees' travel to and from the event. Planners can choose from travel certificates, Presidents Club memberships or passes, or certificates for seating upgrades.
One recent change to Continentals' group offerings is the addition of a $10 service fee for MeetingWorks e-tickets purchased via phone or at the airport. E-tickets purchased through www.continental.com are exempt from this fee.

Delta Air Lines
Domestic group travel: (800) 532-4777
International groups: (800) 337-4777
www.delta.com

Organizations can earn SkyBonus rewards on Delta.

Atlanta-based Delta Air Lines, the leading U.S. carrier across the Atlantic in terms of volume of passengers and flights, touched off an industrywide streamlining and discounting of fares in January 2005 with the introduction of SimpliFares. Changes included cutting transaction fees, reducing the price of tickets by as much as 50 percent and capping domestic coach fares at $499 one way (later raised to $599). Additionally, fare categories were made less restrictive, no longer requiring a Saturday-night stay, for example.
    “Launching SimpliFares and lowering our ticket change fees laid the groundwork for other product changes in 2005 such as a better delta.com experience, more complimentary onboard snacks and a simplified SkyMiles Medallion program,” says Paul Matsen, Delta's chief marketing officer. 
    Clearly, the legacy carrier saw SimpliFares as a way to compete with the business model of its low-cost carrier rivals, and step one was cutting fares. But there was a flip side: Delta's change brought about reductions in service given to groups and planners. As part of the 2005 restructuring, Delta eliminated its Delta Meeting Network, which had allowed meeting planners to negotiate 5 to 10 percent discounts and choose from a menu of zone fare products and special services. 
    This and other changes at the airline raised the hackles of event planners, particularly those running group incentive programs. Last April, the Chicago-based Society of Incentive & Travel Executives chastised Delta over SimpliFares revisions that require ticketing within a period of 30 days after blocking space with the carrier.
    The problem? “Typically, when an incentive trip is planned, the airline is contacted nearly a year prior to the event,” explains Bill Boyd, president of SITE and president of Sunbelt Motivation and Travel. “Seats are blocked, but the actual names cannot be submitted until 30 to 60 days prior to travel, since incentive winners are not known until the end of the incentive campaign.” 
    While Delta has yet to address this concern (see sidebar, “Insensitive to Incentives?” below), the carrier does block out seats for groups of 10 or more passengers traveling together on the same flight. 
    In place of the more extensive benefits of the Delta Meetings Network, the airline now offers the SkyBonus rewards program, which provides free tickets, flight upgrades and other rewards for businesses and organizations that accumulate sufficient points, based on the amount of travel purchased. 
    As part of its survival strategy, the 76-year-old carrier declared bankruptcy last September, intent on cutting costs and better competing with low-cost rivals. 
    “Delta's financial problems are severe, but by no means insurmountable,” says Delta CEO Gerald Grinstein. “We are optimistic about our future because we have been working on a business plan that builds on the substantial improvements we've already made and demonstrates that Delta can return to profitability once the company is able to restructure appropriately.”

Northwest Airlines
(800) 692-6955; www.nwa.com

Northwest is the world's fourth largest airline, with service to about 900 cities in more than 160 countries. As with most of the other legacy carriers, the Northwest/KLM Meeting Travel Program applies to groups of 10 or more traveling together to a meeting, event, convention or incentive reward program. 
    With Northwest, planners can negotiate a contract on a per-meeting basis or negotiate a discount covering all meetings travel for a given organization, after which they can book travel (including changes or cancellations) and manage contracts over the Internet via nwa.com. Each contract has a specialty sales agent available to assist with questions about the group reservation. Northwest also offers companies a preferred carrier agreement (a negotiated contract). 
    For those with the preferred contract, NWA offers travel managers a program called CorpNet, with benefits including share-based agreements that are sensitive to changes in the economic environment; electronic web-based reports; monthly program results that include savings and future opportunities; and internet-fare performance tracking.
    On Sept. 14, 2005, Northwest Airlines went into Chapter 11 bankruptcy. The airline now hopes to restructure its costs by renegotiating labor contracts and devising a more efficient business model. The Chapter 11 filing does not appear to have affected the carrier's group travel or meetings offerings. 
    “We have many valuable assets that position us well in today's marketplace, including a strong presence in U.S. heartland markets and extensive international routes,” says Doug Steenland, Northwest's president and CEO. “Once our reorganization has been completed and a competitive cost structure is in place, Northwest will emerge as a strong competitor with a solid future.”

United Airlines
(800) MEET-UAL (633-8825)
(800) 521-4041
www.united.com

In early February, Elk Grove Village, Ill.-based United Airlines, the country's third largest in terms of passengers transported (after Delta and American), emerged from the biggest and longest bankruptcy of any U.S. carrier in history. The airline, with significant hubs at Chicago O'Hare, Denver and San Francisco, continues to offer a full line of products to organizers of meetings and events. 
    United's program for groups, dubbed MeetingsPlus, offers an array of discounted fares, personalized attention, amenities and promotional support. Benefits apply to conventions, conferences, meetings and incentive programs around the world. 
    When a minimum of 10 meeting attendees fly from various points of departure to a single destination with United, these travelers receive a percentage discount off published fares. However, travel must originate, and the meeting must take place, within the United States or Canada. MeetingsPlus offers two types of agreements, depending on the number of group travelers.
    With version one, a commitment of 10 passengers earns a 5 percent discount on any published fare, including first-class United First fares; a 10 percent discount applies to coach fares; and an additional 5 percent discount is applied to tickets purchased at least 30 days in advance of travel.
    With version two, a minimum of 25 passengers receive 5 percent off any published fare, 10 percent off any full coach fare, as well as area (zone) fares that “offer additional discounts off full, unrestricted coach fares for travel within set U.S. and Canadian travel areas.” An additional 5 percent off is applied when tickets are purchased at least 30 days before travel. A penalty is applied if the minimum of 25 passengers is not met. 
    When 25 or more passengers fly United to a common destination in the United States or Canada, the carrier also offers guaranteed fares that provide more flexibility in ticketing and avoid a Saturday-night stay requirement. 
    In addition to its discounts, United offers groups Mileage Plus frequent-flyer miles, seat upgrades and a dedicated reservation service to assist travelers with flight arrangements. Planners earn certificates for travel based on the number of travelers tracked and flown. United also offers special rates on freight and car rentals with Avis and Budget. 
    For international meetings and conventions, United offers discounts off published fares for groups of 25 or more traveling to a common destination from cities in the United States and Canada. Other plans are available for international events involving 500 or more attendees and six months' lead time through Star Alliance Conventions Plus.

US Airways
(877) US GROUPS (874-7687)
www.usairways.com

Tempe, Ariz.-based US Airways, with major hubs in Charlotte, N.C., and Philadelphia, continues to offer programs geared toward planners and attendees of group events. The airline is somewhat of a new entity, the result of a merger with America West in 2005, whereby US Airways was acquired by the parent of America West to form “the first nationwide full-service low-cost airline” that serves more than 200 cities in North America, the Caribbean and Europe. At the same time, the carrier emerged from its second round of Chapter 11 bankruptcy. 
    To qualify for pricing packages from the US Airways group desk, 10 or more passengers must travel on the same flight. Benefits include special pricing with fares based on availability and the average fare for the group. A $25 per- person deposit is required for the group deal, with the full fare due 45 to 60 days prior to travel. One free name change can be made to each ticket. Groups traveling on US Airways can avoid minimum-stay and delayed-ticketing requirements.  
    One complimentary “tour coordinator” ticket is provided by the carrier for each 40 passengers, with a maximum of three per aircraft. 
    For international travel, US Airways offers discounts to meetings and conventions taking place at international destinations when at least 10 people are traveling on the carrier. Benefits include special pricing such as percentage discounts, free tickets based on the number of travelers, reports containing comprehensive meeting information and earned mileage for Dividend Miles members.