Chapter 1431 Solving the Overbooking Problem

The overbooking of Delta Air Lines has always been a big problem, and there has never been a good solution. However, a few days ago, Delta Air Lines made troubles because of overbooking. After being caught, a series of videos and soft texts created a crisis for Delta Air Lines.

As a result, Delta Air Lines' stock price fell by nearly 10% in the past week, and the loss was not insignificant.

For this matter, Yang Cheng was not less angry, and made many phone calls to put pressure on the executives, but there was not much improvement.

In the end, the problem was solved by spending money. The big V lion who made trouble opened his mouth and asked for 1 million dollars in hush money, and another 1 million dollars for speeches that wanted to change public opinion.

And this guy is a ghost, he doesn't give Delta Airlines a chance to find loopholes, and wants to sue him for blackmail? There are no doors~

No matter what, the money spent has finally seen results. At least the public opinion crisis has passed temporarily, but the lost stock price is difficult to recover in a short period of time, unless the major shareholders take action to protect the market.

But Yang Cheng has no spare money to stimulate the stock price recently. He has no choice but to force the management of Delta Airlines to come up with a practical reform plan to completely solve the overbooking problem from the source.

Burns also seems to be very concerned about this issue. Delta Air Lines is a big fuel eater. Although the proportion of aviation fuel purchased from EssenMobil is much less due to the North Sea oil relationship, it is still a big customer. Burns does not want all lost.

Yang Cheng spread his hands, "The management thought of a way out of nowhere and offered cash compensation."

Abramovich is undoubtedly more concerned than Burns. It is also because he has been busy with the affairs in the UK recently and has not paid much attention to the news of Delta Air Lines. Anyway, the amount of crude oil purchased every month is quite a lot, and he has not worried too much. Who would have thought There was such a drama.

"How to compensate? A full refund?"

Yang Cheng nodded, "Almost, when a flight is overbooked, Delta will let passengers decide how much compensation is acceptable.

Let’s say you’re flying from Minneapolis to Philadelphia and you’re overbooked when you check in online.

It depends on how much travel cash coupon you are willing to accept to change the itinerary, take a later flight, 500, 300, $200, or less~

If you greedily choose 500, we will also refuse to deal, because this is beyond the scope of compensation.

Of course, you can try to continue to try your luck, check in at the airport earlier, and occupy the seat first, hoping that a certain passenger will not be able to board the plane for some reason. "

Burns and Abu looked at each other, obviously did not understand, Yang Cheng wondered if what he just spoke was Chinese?

I had no choice but to reorganize the language and said, "Probably when a passenger checks in for an overbooked flight online or at the self-service check-in machine at the airport, the system will automatically ask how much compensation the passenger is willing to accept to become a volunteer for the overbooked flight. , thus giving up your reservation.

There will also be a prompt that Delta accepts volunteers with the lowest bids first.

Then when you arrive at the boarding gate, the staff at the gate will pass through a passenger list that has been prepared, and read out the passengers who are willing to wait on the list.

That is, if you bid low enough, you will be on the list.

By allowing passengers to voluntarily bid for their own seat reservations, it is basically guaranteed that volunteers who give up seats can be found at the lowest price every time, and this price is likely to be the floor price. "

Abu couldn't help complaining, "The passenger's brain is short-circuited? Why do you accept such an unfair bid?"

Burns continued, "If the passengers agree to set 300, what will you do?"

Yang Cheng smiled, "This kind of assumption does not exist. You can cooperate with your friends, but can you reach a consensus with a hundred passengers? I think it is very difficult.

And, wouldn't it be better to let guests decide for themselves the value of their time?

From the perspective of human nature, people who are already on the plane must want the most flexible time,

The least affected guests should voluntarily give up their seats when they get off the plane, and don’t delay the normal take-off of the plane. People’s time has different values, and more importantly, people must have a clear understanding of this value.

This is a comprehensive approach we came up with after referring to the solutions of several airlines. When United Airlines employees hold a loudspeaker at the boarding gate and ask for a certain number of volunteers to wait, it is very easy to see the end It is better for United passengers to rush to the gate counter, or for Delta passengers to hold a satisfactory compensation and wait for the flight to board the plane with peace of mind. "

Burns seems to be able to understand the benefits of this system, but Abramovich still doesn't quite understand why, in his opinion, people would voluntarily give up their fair-earned seats, and delay precious seats for a worthless compensation. what time?

Seeing the puzzlement on his face, Burns smiled and said, "I think this is a pretty good idea. By extension, people can even use Delta's system to measure the value of time, that is, if they change their booking Flight, how much is your loss?

This is a number worth calculating!

For a father who is preparing to attend his daughter's wedding, no matter how high Delta's compensation is, it is estimated that he will not make him take the initiative to change his itinerary.

But for a college student returning home from summer vacation, the loss of spending a few more hours at the airport newsstand is basically negligible.

Delta's auction system, which is invisible to passengers, must not allow such college students to bid higher than other travelers who are not willing to volunteer.

But what if no one is willing to bid, or some reason forces the airline to switch to a smaller aircraft? "

Yang Cheng said without hesitation, "Delta still needs to send requests to guests at the last minute, and usually, we will try our best to reach a consensus with passengers in advance.

Take the trouble we encountered this time as an example. Delta encountered a serious shortage of seats due to the storm that lasted a week at Atlanta Airport, its main hub.

If our internal bidding system can be launched, we can formulate three levels of compensation, 800, 1000, and 1350, for passengers who voluntarily give up their seats, and then cooperate with Express Bank and Best Buy to give some shopping coupons or promotions, etc. I believe that we can solve the problem of passenger backlog in a very calm manner. "

Burns nodded appreciatively, "Great concept and design, I can't wait to see this system launched soon, it will greatly improve the quality of operation, if you earn more, we will enjoy it too, if necessary , I am willing to help you promote this system across the United States."

Naturally, Yang Cheng would not refuse, and readily agreed, "Let's discuss it in detail when we return to the United States.

However, we have made internal predictions that if this system is successfully launched, Delta’s performance in passenger processing will be far better than other competitors such as United Airlines, and Delta’s passenger voluntary wait rate will increase instead of voluntary endorsement rate. will be much lower than competitors.

According to the statistics of the past few years, about 96 out of every 100,000 passengers in Delta have to sign a later flight due to overbooking, the number of United Airlines is 95 per 100,000, and the number of American Airlines is 100,000. 50/50.

We're confident we can get Delta's involuntary endorsements down to single digits per 100,000 passengers, so Delta can have thousands of customers voluntarily endorse subsequent flights instead of voluntary endorsements Some are thousands of fewer than their competitors. "

Abramovich asked, "Is the low rate of involuntary transfers important?"

Yang Cheng said firmly, "Of course, this will not only allow the airline to maintain a good reputation and passenger satisfaction, but also avoid a large amount of expenses.

When an airline needs to endorse a passenger involuntarily, according to the regulations of the U.S. Department of Transportation, it needs to compensate the passenger up to four times the fare, which is much higher than the voluntary compensation that the airline gives to the passenger.

In addition, the compensation we give to voluntary rebooking guests is company cash coupons instead of direct compensation in cash, and the cost required is much smaller!

Although the unit price does not seem to be much different, based on the base of tens of thousands of involuntary passengers who change their tickets every year, the cost caused by overbooking may reach tens of millions of dollars in losses.

But this new system we developed, looking for passengers who are waiting for the lowest price, is our original invention, and it can also save the company tens of millions of dollars in annual losses. "

Burns was able to become the first black female CEO of the Fortune 500, and her thinking is indeed unusual. Then Yang Cheng gave her own opinion, "Delta's bidding system, I think it not only saves them Big expenses, and the incalculable cost of silence.

If you think about it, the willingness of passengers to give up their seats before arriving at the gate requires a lot of saliva and time to communicate, especially when negotiating with passengers to bring to the gate staff before the gate closes at the last minute The savings from cash vouchers are nothing compared to the stress and cost of delaying a flight and inconveniencing all passengers already on board.

Reducing the workload of gate staff as much as possible so that they can do their job and release the plane on time can lead to a lot of positive impact.

The higher the flight punctuality rate, the lower the fuel expenses, the cost of passengers missing connections, the cost of overtime employees, and many other costs that I can't explain.

In the final analysis, flight time is very important. "

Yang Cheng slapped her hands, "Excellent, if it weren't for EssenMobil, I would definitely not let you go, I really want to poach you as the CEO of Delta Airlines, Ms. Burns!

I can reveal an inside tip that Delta has begun testing a program that helps passengers load their luggage before boarding the plane, so that passengers can avoid the embarrassing scene of crowding the aisle and stuffing luggage into the luggage rack.

This will greatly reduce the boarding time. In addition, Delta Air Lines has already connected to the big data system of New Era Media. Using supercomputing and big data technology to improve operational efficiency is what we will pursue in the future. "

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