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Cash-Strapped Airlines Try In-Flight Advertising

By Keith L. Alexander
Tuesday, June 7, 2005

On a recent Alaska Airlines flight, passengers were told to remain buckled and seated for the last 30 minutes before landing at Reagan National Airport. It was a standard security measure for flights heading into restricted airspace over Washington.

It also turned a planeful of passengers into captive customers who were then pitched a Bank of America Visa card -- with little chance of tuning it out. Over the intercom, a flight attendant encouraged passengers to sign up for the Bank of America credit card. Then other flight attendants went down the aisle handing out applications.

Marketing now follows potential customers into the skies. In the airline industry's newest way to drum up revenue, carriers have become aggressive pitchmen for a range of products to passengers at 30,000 feet. The airlines say the ad revenue helps in these tough financial times. But some passengers liken the pitches to ads in a movie theater before the main feature.

"It's worse than the idea of cell phones in flights," said frequent flier Sylvia Caras of Santa Cruz, Calif.

Advertising in the air is nothing new. Most airlines run some commercials during their in-flight entertainment. And most in-flight magazines carry ads.

But until now, passengers could simply look away from the screen or turn the magazine page.

For Alexander Velaj, a Stamford, Conn., insurance agent, the latest trend in on-board salesmanship is another reason for "purchasing the Bose noise-canceling headphones."

But Montgomery College English professor Chet Pryor said he accepts the in-flight product pitches as the trade-off for lower fares. "They're simply something that must be endured," he said.

Alaska Airlines spokeswoman Amanda Tobin said passengers had expressed an interest in learning more about applying for Visa credit cards and that the airline's flight attendants share "basic" information.

Alaska isn't the only airline to push products. Since last August, Bank of America Corp. has paid US Airways employees $50 for each new applicant they get to sign up for a Visa card. The US Airways employees who nab 15 new applicants receive $750, plus a $75 bonus. The payments extend not only to flight attendants, but also to US Airways customer service and reservation agents.

US Airways spokesman David A. Castelveter said employees were not "required" to make the Visa announcements and did so "voluntarily and with discretion as not to inconvenience" passengers.

Bank of America offers joint credit cards with Alaska Airlines and US Airways that allow customers to earn frequent flier miles with purchases.

The airlines declined to comment on how much revenue they receive from the product pitches.

Since 2003, America West Airlines has sold advertising space on its tray tables. Companies such as Bank of America, Saab AB, Dillard's Inc. department stores and the History and A&E cable channels regularly purchase spots on America West's seat-back trays. Companies pay to have their products painted on the tables for 30 to 90 days.

Saab is also paying America West to promote its new sport-utility vehicle during flight announcements. The airline has the Saab logo emblazoned on napkins that flight attendants hand out to passengers. The airline also promotes Saab on its Web site.

Painting the products onto the tray tables is an "innovative way to give exposure to a company without being too intrusive," said America West spokesman Carlo Bertolini.

Wi-Fi on United: By next year, United Airlines could become the first U.S.-based carrier to allow its passengers to surf the Internet, check e-mails and send instant messages during flights.

United announced yesterday that the Federal Aviation Administration approved the airline's use of Verizon Communication Inc.'s Wi-Fi service.

United spokeswoman Robin Urbanski said the airline has not yet determined a price for the service. The Wi-Fi will be available to first-class and coach passengers on all of United's North America flights, as well as to passengers on United's low-cost subsidiary, Ted.

Several foreign airlines already offer Wi-Fi on their international flights. Lufthansa Airlines charges $30 to use it throughout a flight or $10 for a half-hour. Lufthansa passengers pay for the service with their credit card, but the airline is working on a new system that permits passengers to pay with frequent flier miles. That option should be available by the end of the year, said Lufthansa spokesman Tom Tripp.

Northwest Cuts Amenities: Beginning Thursday, Northwest will no longer offer passengers a free half-ounce bag of pretzels during flights. Instead, passengers who want a snack will have to pay $1 for a three-ounce bag of almonds, cashews and raisins. The move will save Northwest about $2 million a year, said spokesman Kurt Ebenhoch.

Free pretzels aren't the only amenity Northwest has eliminated. The airline said it was pulling its 30 free magazines from its planes. The airline isn't eliminating its own Northwest in-flight magazine, but its complimentary copies of Business Week, Glamour and Harvard Business Review are history.

Ebenhoch said the airline had no plans to eliminate other services, but added that it was reviewing other ways to trim costs.

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