AIRbits: inflight magic, "pull up", and DL's new Upper Class

Rohit Khare (
Tue, 15 Sep 1998 18:00:14 -0700

* Asiana's live entertainment initiative, featuring onboard
magic shows, birthday celebrations, face painting and stretching
activities, received such a positive response on its Seoul-Los Angeles
flights that the carrier recently added these activities to its Seoul-
New York flights, said Eric Oh, marketing coordinator for Asiana. But
premium class passengers were not as thrilled as economy class
passengers at the entertainment. The initiative was launched in all
three classes of service - first, business and economy. Now, unless
requested in the premium classes, Asiana only entertains for economy
class passengers since they tend to be less tired or less anxious to
work, said Oh.

* A new safety report calls for a mandatory spoken English tests
for pilots and controllers. The report, by the Aeronautics Committee
of New York City's Bar Association, cited the example of a 1993
accident in which Chinese pilots flying a U.S.-made MD-80 were
attempting to land in northwest China. The pilots were baffled by an
audio alarm from the plane's ground proximity warning system. A
cockpit recorder picked up the pilot's last words: "What does 'pull
up' mean?" Korean Air launched an intensive English language training
program following its crash in Guam.

[DELTA pilots vetoed any codesharing with United. So that "alliance"
looks weak.]

Delta Launches Major Shift to Two-Class Product

After extensive passenger surveys, Delta Air Lines [DAL]
concluded that the overwhelming majority of passengers flying long
haul would rather fly in a premium business class than have access to
sleeper seats.
It was this discovery, coupled with supporting financial data,
that prompted the carrier this week to abandon its three-class long-
haul product for a two-class product featuring a significantly
upgraded business class.
American Airlines [AMR] recently overhauled its first class
product with the installation of sleeper seats. Many other
competitors, including United Airlines [UAL] and Lufthansa have opted
to do the same, but Forrest Harding, an airline consultant and
professor of marketing at California State University Long Beach, said
that Delta's initiative is more representative of current industry
"What's going to happen is that first class is going to
disappear," said Harding. "First class has become a refuge for
frequent flyers burning up miles."
In fact, Delta's decision establishes the line of demarkation in
premium products. As Harding pointed out, British Airways (BA) has
really set the standard for first class and airlines that want to stay
competitive must either upgrade to the level of BA or significantly
improve their business classes. "The one choice you cannot make
regarding first class," said Harding, "is to stay where you are."

Details of the Product

Delta's new class will feature a seat designed specifically for
Delta by B/E Aerospace with individual in-flight entertainment systems
and power ports. The carrier also is completely redesigning its menus
and service.
While Delta is not yet revealing the total number of seats that
will be gained or lost in the overhaul, a spokesperson pointed out
that the change will give Delta a greater revenue premium than its
current situation.
Still, in deciding to launch the new configuration, Delta
surveyed 714 of its premium passengers over the telephone and in
international lounges in Atlanta, Cincinnati, Chicago, New York,
Portland, London, Frankfurt, Paris and Brussels, said spokesperson
Katie Moussouri. That survey was completed in July. The carrier also
enlisted the aid of 83 of its frequent flyers to undergo eight-hour
sessions in a prototype of the new seats. Customer feedback was then
incorporated into the final seat product.
The two-class product will be installed on Delta's 15 MD-11s and
42 767s. Its 12 new 777s on order will be delivered with two classes.
Passengers will find the new product on trans-Atlantic and trans-
Pacific routes and on flights between the U.S. and Brazil.
"The ability to sell first class has become tougher because
companies here are not supporting that level of service," Harding
pointed out. "Also, business classes have been so upgraded that the
difference between first and business really is more style than
substance. Delta seems to have made a very rational decision."
Delta's domestic and short-haul flights offer two classes, first
and economy, and Moussouri said that the carrier had no plans to make
any changes to that product in the foreseeable future. >>Harding,
626/355-6267; Moussouri, 404/715-2531<<

What Are the Trends in Premium Travel?

Delta surveyed 714 first- and business-class passengers to
determine what its new premium product should feature. From those
surveys, Delta learned:
* 55% of business class passengers would increase their travel
on an airline with a premium business-class product.
* 96% of passengers said superior seat comfort was extremely
important or very important in choosing a carrier.
* 82% of first-class passengers would try a premium business-
class product.
* In 1997, the intercontinental business-class travel market
grew about four times faster than first-class.
* The business-class market for the industry is seven times
larger than the first-class market in terms of passenger numbers.
Source: Delta Air Lines


Rohit Khare -- UC Irvine -- 4K Associates -- +1-(626) 806-7574 --