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Flight delayed? Biztravel.com starts a travel refund plan 

Susan Carey  
An Internet travel company is promising to do more for airline passengersthan airlines have ever done themselves. Biztravel.com (www.biztravel.com)will offer customers unprecedented refunds for late or cancelled flights onfive big carriers -- American Airlines, Continental Airlines, US Airways,British Airways and Air France -- anywhere in the world.

US fliers who purchase tickets on those five airlines through biztravel'sWebsite can apply for refunds of $100 if their planes arrive more than 30minutes late to their destinations and $200 for delays of an hour or more.For flights delayed more than two hours, or cancelled on the day ofdeparture for anything other than a mechanical problem, the Internet travelagency plans to offer full ticket refunds. Biztravel.com also says it willpay customers using those airlines smaller refunds if their luggage goesastray, if seat assignments aren't honored or if specially requested mealsaren't served.

It may sound like a gimmick -- especially since the five carriers, whoseperformance biztravel will guarantee, won't contribute a cent.

But biztravel.com is betting that the programme will boost traffic to theWebsite and improve its ratio of customers who book, rather than browse for,tickets. The Website, currently aimed at small companies and individuals,expects to book $200 million in travel this year.

"We are stepping up to an industry that needs service leadership," says HalRosenbluth, chief executive of family-owned Rosenbluth International, whobought biztravel last summer with some minority investors. The world'sthird-largest travel management company, Philadelphia-based RosenbluthInternational is biztravel's majority owner and operator.

"If you buy a television from Wal-Mart and it doesn't work, you return it tothem and they give you a new TV or your money back. If your flight isdelayed an hour and you miss an appointment and lose the business, you don'tget anything back from the carriers." The "Biztravel Guarantee" will beadvertised in major newspapers across the country and on CNN AirportNetwork, with the tagline, "It's about time."

At a time when complaints against airlines are soaring, the programme isexpected to cause a stir in the travel industry. "This is completelyunprecedented," says Terry Trippler, a passenger advocate who works forrival Website 1travel.com. "It's very daring. I would never tie so much as$5 of my own money to an airline doing its job." Three of the airlinesdidn't return calls seeking comment. "British Air applauds the initiative,"says a spokesman. Houston-based Continental, which has a good record forpunctuality, "is just pleased that Hal has the confidence to have us in theprogramme," says Bonnie Reitz, senior vice- president of marketing andsales. Asked why the airline, which carried 46 million passengers last year,wouldn't adopt a similar programme on its own, she laughs. "That's a goodquestion."

Passengers certainly will notice. "I think it's a great idea," says MissyWhite, a Boston-based frequent flier who works in institutional sales. "I'dbe independently wealthy if they did it for Northwest Airlines." Whitecomplained to that carrier recently about two bad experiences and wasoffered miles, reimbursement for a hotel room and a voucher. "We apologisedprofusely, and did try to address her concerns," says a Northwest spokesman.Biztravel launched the guarantee programme after polling more than 400 ofits customers about their travel frustrations.

Airlines generally offer travellers very little to compensate for miseryencountered on the road, although fliers who squawk sometimes get free milesor vouchers.

Specific rules govern involuntary denied boarding, or "bumping." Currently,stranded passengers who can't be put on a later flight or a competitor'splane can count on getting a ticket refund and maybe a night's lodging, butnot much more. Lateness isn't even addressed.

The big US airlines in December did pledge to atone for bad service byadopting voluntary customer-service programmes. But that move clearly wasintended to stave off legislation that Congress threatened to enact in thewake of an escalating torrent of complaints last year.

And an analysis of those plans by the General Accounting Office, theinvestigative arm of Congress, found that many of the promised measuresalready fell under federal laws concerning unfair or deceptive tradepractices or the legal fine print that governs the transaction between anairline and a customer who buys a ticket.

The move is clearly risky for biztravel. If the programme became tooexpensive to continue, it could give biztravel's reputation a black eye. Thethree US airlines included in the guarantee together operate about 10,500flights per day. Refunds can be invoked for weather and air-traffic controldelays. "An East Coast blizzard could get a little expensive, Hal," saysTrippler of 1travel.com.

In March, the latest month for which statistics are available, nearly 75 percent of America's domestic flights arrived within 15 minutes of schedule,and about 81 per cent for Continental and US Air. That means the rest werelate, although the Department of Transportation doesn't publish data on howmany flights were more than 30 or 60 minutes late. In the same month, thethree carriers cancelled nearly 3,300 flights, ostensibly some of them onthe day they were scheduled to depart. That also would trigger biztravelrefunds if the cancellations weren't related to mechanical problems.

Biztravel clients simply must report the problem they encountered within 24hours by filling out a report on the Website or calling a toll-free number.After the online agency verifies the travel setback, the passenger will bereimbursed within three weeks. "I don't believe people will take advantageof us" in pursuing claims, Rosenbluth says.

Why did Rosenbluth choose the five carriers? "They have a quality product orhave dedicated themselves to having a quality product," Rosenbluth says. Heconcedes that Continental and British Air are minority investors inbiztravel.com, but says that is only one reason he selected them for theguarantee programme.

Some people are heartened by the guarantee programme. "Here is a travelagency that finally is doing something in the interest of its customers,"says Roger Hallowell, an assistant professor at Harvard Business School whorecently published a case study on Rosenbluth and biztravel. "It's anacknowledgment that something's gone wrong."

-- The Wall Street Journal

Copyright © 2000 Indian Express Newspapers (Bombay) Ltd.

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