Airlines Offer Deals to Land Senior Citizens as Customers

Several times a year, John and Louise Beddoe of Melbourne, Fla., fly to visit their three daughters, who live in Chicago, New York and Cambridge, Mass. They also pay regular visits to relatives in Los Angeles, San Diego and Seattle and go to Philadelphia three times a year to see Louise Beddoe’s aging mother.

They calculate that full-rate air fare for all of their trips would total about $50,000 a year.

But the Beddoes and many other people are taking advantage of special cut rates that the nation’s airlines are offering older Americans. Senior citizens now qualify for special deals, ranging from passes good for a year’s nearly unlimited travel on an airline’s routes to airline-sponsored clubs that an elderly person can join for a flat fee and that offer a 10% discount per flight.

Every year since 1983, the Beddoes have each purchased a Get-Up-and-Go Passport from Eastern Airlines for $1,199 each; with a few limitations, it gives them all of the trips they want to take on Eastern. In their first year as Eastern “passport” holders, they paid only $999 for the “passport.” Since then, the price has risen to $1,299 for the first year, but people like the Beddoes who renew their passes each year still get them for $1,199.

“It would not have been possible without the passport,” said the 66-year-old Beddoe, a retired hospital administrator. “We flew 100,000 miles in the first year. One visit to each of our daughters and to my wife’s mother would have cost us the price of the passport. All the rest was just gravy.”

Eastern, which pioneered the senior citizen passes in late 1983, says it has sold “tens of thousands.” It will not be more specific, so as not to inform competitors. So far, only Trans World Airlines has offered a similar plan.

Because more people are retiring earlier, Eastern has recently reduced the age for its passports to 62 from 65.

There are restrictions on discount flying. For example, depending on which airline’s program a senior citizen joins, he or she may have to fly midweek, not return to a trip’s point of origin in the same week and make no more than three round trips to and from the same place each year.

The reason that there are so many new reductions for older people is that the airlines are beginning to recognize that many of them have plenty of money to spend and virtually unlimited time in which to spend it.

“The older consumer, so cavalierly ignored by so many marketeers, is in fact the prime customer of the upscale market,” according to a recent report by the Consumer Research Center of the Conference Board, a nonprofit research and educational organization. Citing Federal Reserve Board figures, the report said that, of the total financial assets held by the nation’s households, 40% are held by those headed by people 65 or older.

And much of the seniors’ money is there to be spent. Of the total after-tax personal income flow to the nation’s households, an estimated 17% represents money available for discretionary spending. But for households headed by people aged 50 and older, the average proportion is almost 20%, and it remains at about that level after age 65.

Many seniors can spend more because they have diminishing financial needs. “At this point in their lives” recently retired people “have more money than they will have for the rest of their lives,” said Joseph G. Lynch, manager of leisure marketing programs for Eastern.

The recent retiree has just come off a full salary and is likely to have been saving for a number of years. And chances are that he or she has just sold property in the Northeast in order to move to the Sun Belt.

Because four out of five homeowners between ages 65 and 75 have paid off their property, the Conference Board notes, they have new capital to spend when they sell. In addition, pension payments have begun to come in.

The ranks of senior citizens are growing. At present, 12% of Americans--about 28 million people--are 65 or older. By the turn of the century, the figure is expected to grow to 34.9 million, which is expected to make up 13% of the population then, according to the American Assn. of Retired Persons.

“The senior citizens market is one of the fastest-growing consumer markets in the country,” said Thomas G. Plaskett, senior vice president of marketing for American Airlines. “They have disposable income; they have great flexibility in arranging their travel plans, and they like to travel. It’s a perfect match--needs versus opportunity.”

“Clubs” for senior citizens are a new device through which some airlines are selling discount flights. Others say they are about to announce formation of such clubs.

Plaskett said that more than 10,000 seniors joined his airline’s Senior Citizen SAAvers Club in its first week last month for a membership fee of $25 each. If the senior wants to fly regularly with a companion younger than 65, the cost of the membership is $100, making the younger person also eligible to receive the benefits of membership. They may fly at certain restricted times for a discount of 10% and, until July 1, new members will receive a voucher for travel on American equal to the value of the membership fee.

United Airlines, which also charges $25 for membership in what it calls the Silver Wings Plus Club, said 5,000 people signed up last month during its first week of availability. United returns $50 worth of travel for the membership fee. John R. Zeeman, executive vice president for marketing and planning, estimated that the United club will have 1 million members by year-end.