Desperate Times Call for Innovative Measures
By Jeff Robertson, Managing Director, SkyMiles

It’s no secret that the airline industry flew through turbulent skies in the wake of Sept. 11. The tragedy set in motion a chain reaction of financial pressures that tossed the nation’s carriers into a tailspin and – combined with capacity reductions, union issues, wage concessions, rising gas prices and the growing popularity of low-cost airlines – sent Delta spiraling into bankruptcy in September of 2005. The SkyMiles program, like all divisions within Delta, was greatly affected.

Over the years, I’ve watched the program that began as a promotional idea, become an important, profitable and powerful marketing strategy for Delta. With 40 million members and more than 100 partners, it is now one of the largest loyalty programs in the world. So the challenge for us when Delta filed for bankruptcy protection was this: How do we maintain – and continue to enhance – a program based on rewarding customers while making significant changes across the board? As you know, it’s been a bumpy ride.

The SkyMiles team – now half our pre-bankruptcy size – is overloaded at times, and yes, Delta headquarters often feels a little empty. But I’ve learned during the last year and a half that Chapter 11 hasn’t been an entirely bad thing for Delta – it has provided an opportunity.

Our singular focus has always been the customer experience. We want to offer our members superior benefits, unlimited travel opportunities and easy, enjoyable experiences – from booking to baggage claim. That mission did not change when we filed for Chapter 11, but we’ve radically modified the way we accomplish our goals. Our strategy? Innovation. In the midst of cutbacks, we have stepped outside the box to implement creative, cost-efficient changes within the program, which have ultimately improved customer experience and – hopefully – satisfaction. It’s all been part of an overall transformation; we’re creating a “NEW” Delta Air Lines and a “NEW” SkyMiles program.

Technology has been a key component of our rebirth. In an age in which travel is booked online, and cell phones, hand-held devices and laptops make the frenetic pace of life more manageable (or more frenetic), we understand that offering customers the most efficient, straightforward and sensible technology saves time and simplifies the travel process. This value-add for customers was something we felt we could do – and do well. So we upgraded our online booking tools, introduced foreign-language capabilities to delta.com, and launched Delta Messenger upgrade notification, an improved mobile Web site and automatic upgrades for Medallion members. We also utilized our online capabilities to provide elite members additional mileage-redemption opportunities through the Medallion Marketplace, which allows members to redeem miles for merchandise.

But we didn’t stop there. This year we’ll upgrade our features and functionality again when we introduce an online calendar of Award availability, online booking for Award Travel on partner airlines and more robust online Award tools. And members will soon be able to redeem miles through a SkyMiles Auction at delta.com.

The SkyMiles team prides itself on listening to and interacting with customers, and we’ve used technology to do this. For example, I recently began posting on a frequent flier forum FlyerTalk.com, and we use e-mail as our primary means of communicating with customers. Through these and other outlets, we’ve heard customers say they want additional opportunities to redeem miles and increased availability of Award seats. So we implemented combinable Awards, which will allow members to mix and match Coach, First Class, SkySaver and SkyChoice Awards to create their ideal itineraries – and conserve miles!

And we’re working with our new and existing SkyMiles partners to add value for our members and increase the profitability of the program. As of January 1, Delta and American Express refreshed the SkyMiles Credit Card with new benefits to create the broadest card portfolio in the industry. Card holders at all levels are now eligible to earn more bonus miles than ever before. We also plan to add several “lifestyle” companies to our roster of SkyMiles partners to provide members with daily mileage-earning opportunities. It is through new partnerships like these and long-term relationships with businesses such as American Express that we can continue to offer customers an industry-leading loyalty program, even in the midst of reorganization. And our customers are taking notice. We were named Business Travel magazine’s 2006 choice for best frequent flier program, and Executive Traveler readers just voted SkyMiles the second-best frequent flier program.

But we’re not just leading the industry when it comes to loyalty programs – we’re America’s fastest-growing airline as well, and our international expansion is taking place on an unprecedented scale. We added more than 50 new international routes in 2006 and currently fly to 303 destinations in 52 countries, which greatly increases the reach of the SkyMiles program. And this spring SkyMiles members will be able to earn and redeem miles for trips to Dubai, Prague, Vienna, and Trinidad and Tobago.

Yes, the past few years have been difficult for Delta and the SkyMiles program. But through innovation and an openness to change, we’ve successfully lived up to – and exceeded – the high standards for which Delta has always been known. We’re adding new mileage-earning and redeeming opportunities every day; we’re listening to our customers and delivering the products they want and the superior customer service they deserve. We will emerge from bankruptcy this spring as an independent, financially stable, successful and innovative airline – one I’m proud to work for.

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