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Interview With Travel Consultant Thom Nulty

Aired June 02, 2003 - 15:44   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


MILES O'BRIEN, CNN ANCHOR: One of the nation's largest airlines, United, wants you to fax them your mileage statement from other airlines. Yes, you heard me correctly. As a reward, United officials say they will give you 3,000 bonus miles for each statement. And this summer, if you more with United than you used to, you get even more miles.
Here to talk about this marketing idea, travel consultant Thom Nulty in Los Angeles. Thom, good to have you with us.

THOM NULTY, TRAVEL CONSULTANT: Great to be here.

O'BRIEN: Sounds like it's dog eat dog or airline eat airline out there. A little bit of desperation at the root of this?

NULTY: Well you know I think there may be some desperation. But these travelers fliers have such enormous value to these airlines that what United is doing is probably pretty smart. They're trying to find out if some of their frequent travelers are actually better frequent travelers on another airline.

And it's my guess that if they find that you travel more on another airline than you do on United, they might do something special for you to lure you into their camp so that you fly more with them.

O'BRIEN: So they're upping the ante, potentially, on these particular flyers. These are the elite fliers, these are the people that upgrade into first class and get on the plane first and all the perks that go along with it.

Why are they so interested in them? They aren't the majority of travelers are they?

NULTY: No, they represent a smaller percentage of the travelers, but they do represent a huge portion of the revenue. Some of these frequent travelers when they actually get on an airplane, you know, they're paying four to five times as much as a leisure traveler. And that's very, very important. And on top of that, they travel every single week.

So they are like gold to these airlines and these guys are trying to dig for the gold, and that's what they're attempting to do right now. These frequent travelers are the people they really, really want. O'BRIEN: Yes, but if these airlines get into a fight where they're literally trying to pull apart their various gold nuggets, if you continue on with that metaphor, it could get pretty ugly pretty quickly.

NULTY: You know it could. And obviously benefactor would be the travelers, the travelers are the ones who are going to benefit from this if the airlines really start fighting for them, again. And I think that's probably what will happen. And it will really be down to who can market the best and who can convince these travelers to defect or to stay with their carrier. And that's probably what's going to happen.

O'BRIEN: Imagine that. When was the last time you said, actually, the traveler would benefit in any way, shape or form as the airlines continue their struggle?

NULTY: Well, you know, there are some other things, Miles, that are happening that are positive for travelers, even on the leisure side. Air fares have gone down drastically. I have to fly from southern California to New York this week and I'm going to go round trip for $346 without a Saturday night stay and all these other things. Prices like that just weren't available before. So while these airlines struggle, people do benefit, if you know where to look.

O'BRIEN: Wow. They can't be making money on that one. Boy, that's quite a fare. All right. Thom Nulty, always a pleasure having you drop by. We appreciate it.

NULTY: My pleasure.

TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com






Aired June 2, 2003 - 15:44   ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
MILES O'BRIEN, CNN ANCHOR: One of the nation's largest airlines, United, wants you to fax them your mileage statement from other airlines. Yes, you heard me correctly. As a reward, United officials say they will give you 3,000 bonus miles for each statement. And this summer, if you more with United than you used to, you get even more miles.
Here to talk about this marketing idea, travel consultant Thom Nulty in Los Angeles. Thom, good to have you with us.

THOM NULTY, TRAVEL CONSULTANT: Great to be here.

O'BRIEN: Sounds like it's dog eat dog or airline eat airline out there. A little bit of desperation at the root of this?

NULTY: Well you know I think there may be some desperation. But these travelers fliers have such enormous value to these airlines that what United is doing is probably pretty smart. They're trying to find out if some of their frequent travelers are actually better frequent travelers on another airline.

And it's my guess that if they find that you travel more on another airline than you do on United, they might do something special for you to lure you into their camp so that you fly more with them.

O'BRIEN: So they're upping the ante, potentially, on these particular flyers. These are the elite fliers, these are the people that upgrade into first class and get on the plane first and all the perks that go along with it.

Why are they so interested in them? They aren't the majority of travelers are they?

NULTY: No, they represent a smaller percentage of the travelers, but they do represent a huge portion of the revenue. Some of these frequent travelers when they actually get on an airplane, you know, they're paying four to five times as much as a leisure traveler. And that's very, very important. And on top of that, they travel every single week.

So they are like gold to these airlines and these guys are trying to dig for the gold, and that's what they're attempting to do right now. These frequent travelers are the people they really, really want. O'BRIEN: Yes, but if these airlines get into a fight where they're literally trying to pull apart their various gold nuggets, if you continue on with that metaphor, it could get pretty ugly pretty quickly.

NULTY: You know it could. And obviously benefactor would be the travelers, the travelers are the ones who are going to benefit from this if the airlines really start fighting for them, again. And I think that's probably what will happen. And it will really be down to who can market the best and who can convince these travelers to defect or to stay with their carrier. And that's probably what's going to happen.

O'BRIEN: Imagine that. When was the last time you said, actually, the traveler would benefit in any way, shape or form as the airlines continue their struggle?

NULTY: Well, you know, there are some other things, Miles, that are happening that are positive for travelers, even on the leisure side. Air fares have gone down drastically. I have to fly from southern California to New York this week and I'm going to go round trip for $346 without a Saturday night stay and all these other things. Prices like that just weren't available before. So while these airlines struggle, people do benefit, if you know where to look.

O'BRIEN: Wow. They can't be making money on that one. Boy, that's quite a fare. All right. Thom Nulty, always a pleasure having you drop by. We appreciate it.

NULTY: My pleasure.

TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com