The High Cost of Cheap: When Saving Money is Expensive

The High Cost of Cheap

April 2, 2016

Becoming a local celebrity is not inexpensive. Besides the cost of the training and coaching, you have to pay for all the airline flights, hotels, rental cars, meals, and any other miscellaneous expenses to get to the cities to be on television.

So when I looked on line to rent a car for my two days in Miami; even Thrifty Rental Car was going to cost almost $150, I looked for alternatives. Where? On Expedia and Travelocity, of course. When I found Fox Rental Car could cost me about $100 for the two days, I decided to book with them, but not on Travelocity or Expedia. I went direct to the Fox Car Rental website and guess what? It cost even less!

Drive or Fly?

The next challenge was finding a flight from Miami to Ft. Myers or Tampa/St. Petersburg. Because of the lateness of the date, the cost was close to $300, so I thought about driving. But typically drop-off charges are $75 to $175.

A Very Pleasant Surprise

Before making the final decision to fly or drive, I went back to the Fox site. And guess what? The cost was actually less—$65.86—including the drop-off charge! I would never have believed it, if I hadn’t seen it for myself. So for three days and several hundred miles of driving from Miami to Ft. Myers, then onto Tampa, I paid under $70. What a learning! So far, so good.

Fox Rental Car Office

Entering the Fox Rental Car Office

A Not-So-Pleasant Surprise

Arriving at the Miami Airport, I suspected that Fox was not in the Rental Car Center, but off-site. I was right. I found the shuttle to the Fox office. While the bus was a little more run-down than those of the major brands, but to save almost $300, I could live with “run-down”.

Arriving at the equally shabby Fox office, waiting for me was the real cost of this inexpensive booking. I tried to push the door open, but it would not move. Why? Because the line to get to the counter was back to the door. It took over an hour a half to get to the counter to be served; then it took another half hour to finish the booking process and get a car. The manager was so disturbed by the unresponsive system, he wrote out my contract by hand and sent me on my way.

The problem was a new IT system that was super slow and kept crashing. I can only imagine the frustration of the employees who were dealing with the even-more-frustrated customers who were waiting in line. Had I had an important appointment, I would have been very upset; but given the fact that my schedule was flexible, I took the experience as the cost of saving hundreds of dollars.

The car Fox gave me was an almost new Kia Rio, great on gasoline and very comfortable. The only thing that was missing was cruise control, which would have made a substantial difference in the hundreds of miles I had to drive across Florida.

Flight to Jacksonville

When I went to Kayak.com to look for flights from Tampa to Jacksonville, the flights were surprisingly expensive. The least expensive was Silver Airlines through United. However, instead of booking through United, I went directly to the Silver website (https://www.silverairways.com). There, I not only saved $20, but I was also able to get a seat assignment. Booking through United, I would have had to wait for a seat assignment, until the day of the flight. Plus, with a phone call, I was able to add my United number to the ticket, so I got United mileage credit anyway.

Downside of Smaller Airlines

Once you are accustomed to using the TSA Pre✓® process of The Transportation Security Administration (TSA), going back to the “regular” line is a serious complication. Some of the smaller airlines, including Silver, do not participate in the TSA Pre✓® program; I had not accounted for that additional time, and I almost missed my flight.

When the Travel Costs Are On Your Own Nickel. . .

Sometimes, it will make sense to exchange money for time. Other times, it won’t. The great thing is that you have options, and you can decide for yourself.

It Had to Happen

It Had to Happen

A new study from Deloitte & Touche, LLP found that about three-quarters of high frequency business travelers—the most lucrative kind to airlines—belong to more than one loyalty program. And only about 40 percent of these business travelers log at least three-quarters of their miles on their preferred airline. Many will book another airline even it means abandoning a program in which they’ve earned elite status. Deloitte said it based its findings on a survey of 4000 travelers and focus groups with business and leisure travelers.

That means for 60 percent of business travelers, loyalty programs are no longer determining where they spend their travel dollars. Why? Because many of the airlines and hotels have so devalued their points/miles that when flying a particular airline or staying at a particular hotel means spending $30 to $50 more, they can’t justify it. Just as the devaluation is relatively recent, so is this shift away from the loyalty programs.

It had to happen. Business travelers are voting with their wallets. If airlines wonder why they are being abandoned, they need to look inside their value propositions. The problem with adding value is that consumers are constantly looking for more goodies, more perks, more value.

It’s the challenge all marketers face. You must add value to survive, but consumers are expecting more and more every year. The key is to look for what has a high-perceived value to consumers and a low cost to the airline or hotel chain. They can do it; it will just require more creativity than they are currently applying.

When airlines and hotels are delivering less and less bang for the buck, it is any wonder that they are being deserted? To be fair not all of the programs are in this situation. Marriott is still a lot better than Hilton and American’s program beats US Airways, hands-down. The challenge for these service providers is to reward their frequent travelers enough so that they will stay. For 60 percent of frequent flyers, this Deloitte study says, “They’re failing!”

Why American is my Favorite Airline

American AirlinesWhen I moved to Austin, Texas from Greensboro, North Carolina, I quickly discovered the shortcomings of US Airways service for the city. The only flights in or out were on regional jets with no first class cabin and a not very comfortable ride.

Wanting to make an informed decision, I consulted the Austin-Bergstrom Airport website. There I discovered that the airline, besides Southwest, with the most flights was American at 26 percent. (Now it’s less than 20 percent, but still only behind Southwest.) By the way, if you want these stats for your airport, you’ll find them at http://www.transtats.bts.gov/.

Anyway, I called the airline and of course, they had their own version of a status-matching program. I matched to Platinum within two months; it took a year and a half to achieve Executive Platinum status.

As an Executive Platinum on American, the benefits are excellent, including free unlimited upgrades on a space-available basis, free checked baggage up to 70 lbs. per piece, and boarding with First Class passengers, even when you don’t get the upgrade. But these benefits are not what keeps me coming back.

It’s their people that make the difference! Yes, I know I’m nice to them, too. I call Marc, the ticket counter agent, Denay and Barbie, the women in the Admirals Club, and gate agents Cathy and Lisa by name. And yes, I do bring cookies or muffins to the flight attendants. However, even when I don’t, they are cordial and call me by name. The flight attendants go out of their way to make their road warriors like me feel taken care of. And even the folks on the phone seem to go the extra mile to help.

Why did I really leave US Airways? That’s another story for another blog. Stay tuned.

Stressed When Traveling? Try These Few Tips

Stressing While TravelingWith business travel on the upswing—and travel, in general, is forecast to be brisk through the end of the year—finding ways to ease the stress of traveling is more important than ever. When traveling, I urge people to be conscious. You need to be present to yourself and the world, and you can’t do that when you’re stressed out.

To ease the stress of travel, I offer these insights to my fellow road warriors:

Value staying healthy on the road. Taking care of yourself is critical when you’re on the road. While this may sound like a common suggestion, it is all too often overlooked. When you don’t eat right, exercise and get enough sleep, your body is physically stressed and on high alert, and you’re less able to flow through the inevitable obstacles and aggravations that are common in travel.

Build in reserves. Oftentimes, things require more resources than normal. Perhaps there’s more traffic than you anticipated, or the distance you have to drive to the hotel is longer than you expected. Maybe your trip will need to be extended by a day. Or sometimes even the GPS is wrong. Planning on a bit more travel time, filling the tank of the rental car the night before you have to turn it in, packing an extra shirt and underwear …building in these types of reserves will greatly reduce your stress.

Print out all of your confirmations (on recycled paper of course) and carry them with you. Having your confirmations on your smart phone is a great idea, yet it’s not foolproof. Many times the technology simply doesn’t work as expected. You’ll go up to the gate, hand the smart phone to the agent, and it won’t work. There could be a lack of cell service, the confirmation on the screen won’t scan, etc. Carrying the printed confirmations—and putting them into a folder or large envelope in the order that they will be needed—will save time all along the way.

Travel Tuesday through Thursday, when possible. Not only is air travel less expensive mid-week, it’s also less crowded, especially late morning to early afternoon, and usually just less stressful overall.

They Know Not What They Do

Airlines and hotel chains that have systematically reduced the value of their points and miles have no clue as to the long-term effects of their actions. Case in point: Hilton Honors.

For years, Hilton Honors was number one in the hotel loyalty programs—they offered excellent availability, great earning potential, and reasonable “costs” for room nights. They consistently won The Freddie Award for the best hotel loyalty program in North America. That was then. Life as a Hilton Honors Member is very different now.

Now, although they say that there are some rooms available for as little as 5,000 points per night, they are not in any of the areas I have ever looked in; the minimum seems to be 40,000 points for a room at one of their lowest tier lodging chains, the Hampton or Hilton Garden Inn. On the other end of the spectrum, you used to be able to get a top-tier luxury room for 60,000 to 80,000 points per night. Now, you are looking at 140,000 per night.

what-they-knowAnd let me put that increase into perspective. The average number of points from one lodging night with Diamond status (their highest), even using a Hilton credit card, which multiplies the points, is only about 2500 points per night. At that rate, it would take 16 paid room nights to equal one 40,000-point award stay. Clearly, not a very good deal.

Here’s the problem. Hoteliers and airlines offer branded credit cards, as a way to bring in more revenue. The more successful they are in marketing, the more credit cards they issue. The key benefit to having a branded credit card is that you earn points for everything you charge on the card. What that means is that the hoteliers now have millions of guests with billions of points wanting to use them. Their solution has been to dilute the value of the points—not a happy arrangement for the cardholder, who bought the card, based on one value proposition and now finds himself with another.

I know that I am not the first person to balk at this travesty. One of the principals in BookMyAward.com, a service definitely worth looking into, Dr. Theo Brandt-Sarif, said he spoke with someone at Hilton and the fellow said, “Too bad.” Theo is now building points on Hyatt and Marriott. He also shared some other sage advice: “Use your points and miles as fast as you can, because they are worth less and less every year.”

Well, my forecast as a futurist is that Hilton is going to start feeling the pain soon. . . road warriors and others, like Theo, who watch these things, have already begun to choose Hilton less often. Once they begin to feel it on their bottom line, one would hope that will get their attention. I am personally putting Hilton on notice, they have until the end of 2013. Then I plan to transfer my loyalties elsewhere.

Tips for security

Tips to Help You Breeze through Security—well almost

Tips for securityGoing through airline security can be stressful. While critical to keeping travelers safe, most people think the experience is a hassle at best

There are however a few easy things all travelers can do the make the experience better for themselves and their fellow travelers. To help you breeze through security, here are a few tips I suggest:

Say Thanks. 
Respect that the TSA people are only doing their jobs and in reality, we are somewhat safer because they are. After I get through the screening process, I always say “Thank you for keeping us safe.” It makes their day and their good feelings come back to me.

Plan Your Buckets. 
Try to count the number of buckets you will need and take exactly that many. Sometimes people in the line are annoyed if you have to put some back or need more than you originally thought.

Pay Attention to your Bag Position. 
Be sure to lay any vertical bags into a horizontal position; otherwise, the screeners may send it back through and that will delay your process, and those behind you.

Keep Liquids Handy. 
If you are carrying on your luggage and have liquids, stick the bag of liquids in the top of your purse or the carryon itself, so that you may get to it easily to take it out.

Take Chargers Out. 
If you have bags of chargers or other electronics with wires, take them out along with computers and other large electronic devices. That will save you the hassle of additional bag checks resulting in further delays.

Real Gold Doesn’t Apply. 
When you’re removing large metal belt buckles or other large metal objects, don’t worry about anything that’s real gold. I have a huge solid gold medallion Buddha I wear around my neck that never sets off the machines.

Ask for Private Screening. 
If you’re selected to be searched, ask for private screening. This screening will take a few more minutes, but is performed behind closed doors—much less embarrassing. If you have any qualms about going through the new body scanning machines, ask when you get to the top of the security line for the private screening and they will not make you go through the machine.

Take it to the Bench. 
Once your items have been screened and passed, if there’s a line, take the buckets to a bench, where you can put shoes and belts back on, without holding up the line.

The best rule of thumb: Be as pleasant and efficient as possible; the other people in the line will appreciate it and you’ll get through faster.

Employers Need to Support Road Warriors

As we road warriors travel the world, we have the unique opportunity to immerse ourselves in the local culture, whether we’re chatting with the natives or eating the unique foods of the area. It’s that exposure to diverse cultures that has the potential for making us better at what we do, if we’ll let it.

Yet, the life of a road warrior is not for everyone. Most people mistakenly focus on the downside, instead of the upside. They don’t feel like it’s worth it, in part, because they don’t feel valued by their employers. As a management consultant and futurist, I urge employers it’s time to take action. These skilled labor shortages we’re already experiencing are not going away. There are no easy fixes, but I believe there are positive steps employers can take to ease the trials and tribulations their road warrior employees face. Ideas I suggest include:

• Allow them to leave for a trip on Monday morning instead of Sunday evening
• Recognize that they do have families and support that by offering a little extra to allow the Road Warrior to have a phone call every day with family (or better yet, tell them about Skype calling)
• Try to engineer it so they can be home by 5 pm on Friday
• Give people comp time for the extra time outside of business hours they spent on airplanes and in airports
• Make sure that they have all the support they need in terms of numbers they can call in case of emergencies and help handling traveling challenges such as delays.

Even what seem simple ideas can have a great impact. Remember, if you take care of your employees and they will take care of you.