United Courts Business Travelers, Leaves Other Customers Grumbling

There’s a lot more than a curtain separating customers in United Airlines’ coach and business classes nowadays.

Shower and valet facilities in airport lounges, more comfortable seats and preferential frequent-flier programs are some of the perks United is offering in trying to lure high-paying customers from other major carriers.

The moves have sparked grumbling that the skies are becoming friendlier for some more than others, but executives of parent UAL Corp. offer no apologies.

“We’ve got to stop trying to be all things to all people,” David Coltman, United’s senior vice president of marketing, said recently during a media gathering with top executives.

United President John Edwardson put it more bluntly: “One of the things we’re trying to do is to pay a lot more attention to customers who pay us most.”

The carrier since late 1995 has been perfecting its approach to wooing the “road warrior” and “global traveler.” The road warrior travels often, usually for business, and is willing to buy higher-priced tickets to get service and comfort. The global traveler flies less frequently but also is willing to pay a premium.

While those two segments account for only 9 percent of United’s flyers, they bring in 44 percent of the airline’s revenue, Coltman said.

Competitors argue United is doing nothing they haven’t already done. Because it is late catching up, the carrier is grabbing new headlines, they say.

“The business passenger, particularly those traveling in business and first class (sections), are a very important market for us,” said American Airlines spokesman Bill Dreslin. “They’re really the bread and butter. We see our share of the traffic holding up and indeed increasing on a market-by-market basis.”

But analysts say United has been luring business travelers away from other domestic airlines as it upgrades service and replaces older planes with more comfortable models.

U.S. corporations are expected to spend a record $156 billion on travel and entertainment this year. Of that, $65 billion, or 42 percent, is for airfare, according to American Express.

Catering to such customers helped helped UAL post record profits of $1.03 billion last year.

To continue attracting the big spenders, United is marketing itself as a humble company that knows it isn’t perfect and is working to get better.

“This industry has mastered the art of flying airplanes with one hand on the controls and the other around each others’ throats,” said UAL Chairman Gerald Greenwald. “It’s time now to focus on the customer.”

Its new print and television ad campaign - portraying United as “Rising” - says the company understands that late flights, ill-tempered personnel and lost luggage has taken the fun out of flying, and that United is working to change that.

Even food, often reduced literally to peanuts or a carry-on sack at other airlines, has become a sacred cow for United. The airline sends flight attendants to class at the Culinary Institute of America and the posh Ritz-Carlton and Four Seasons hotels in Chicago for lessons on preparation and presentation. Even coach-class customers get food from recipes provided by well-known chefs.

United also hopes to compete more with international carriers for lucrative overseas routes, even in coach class, analysts say.

“Coach class and leisure class service is quite pleasant on international carriers like British Airways,” said analyst Mark Ray at John Hancock. “But on many domestic carriers, you fly with your knees up on your chin. Not only are (coach passengers) steerage, they feel like steerage at the end of the day.”

The major stumbling block is the employee-owned airline’s inability to negotiate a new contract with its flight attendants’ union.

UAL management contends that to best serve customers, it needs bilingual flight attendants on overseas routes. That means hiring attendants outside the United States and basing them overseas. U.S. flight attendants contend that deprives them of lucrative jobs.

The issue has been unsettled for more than a year, but Greenwald said flight attendants are still doing their jobs well.

“We have come a long way from being one of our industry’s typical dysfunctional families,” Greenwald said. “But at the same time we still are a work in progress.”