Two Companies Take a Stand Against Complaints

In the annals of travel history, 2000 may go down as the year of the dissatisfied customer.

The U.S. Transportation Department’s tallies of consumer complaints about airlines grew to record levels, compounded by record numbers of passengers and by simmering labor problems and work slowdowns at United Airlines. The finances of two small cruise lines, Premier and World Cruise Co., collapsed in mid-cruise, leaving about 3,000 irate passengers to find flights home from ports around the globe.

And as more travel spending migrated to Internet companies, customer advocates like New York-based Consumers Union warned travelers that many Web-based booking sites for air fares may be biased in how they display flight information.

In the middle of all this, two enterprises stepped up to try to guarantee customer satisfaction.

One was long-beleaguered Amtrak, looking to improve its image by pledging coupons for future travel to passengers who expressed displeasure with an Amtrak ride.

The other was Biztravel.com, a young Internet site eager to grab a share of the online airline ticket market by offering refunds for late flights.

How have these two outfits fared? Though spokespersons acknowledge that each program has given back $1 million or more in cash or services to unhappy customers, both enterprises can point to increased revenues. In both head offices, company officials stop short of attributing all sales gains to these programs, but both publicly label their experiments successful.

It’s difficult to say whether that’s the assessment behind closed doors: Biztravel.com is a privately held company that doesn’t disclose financial information. At Amtrak, increased ridership figures notwithstanding, customer satisfaction figures have fallen short of the agency’s publicly stated target.

Amtrak unveiled its “Amtrak Service Promise” program on July 4. Under the provisions, dissatisfied passengers must first complain to an Amtrak employee. If that employee can’t solve the problem, the passenger is to call Amtrak at (800) USA-RAIL ([800] 872-7245) and request a Service Guarantee Certificate.

The value of this certificate typically matches the cost of the unsatisfactory trip. Certificates are good toward Amtrak travel for 18 months. Passengers are asked to give the number from their ticket stub and specify what dissatisfied them.

The results: Amtrak set a goal of less than one complaint per 1,000 passengers. In the first month, Amtrak issued one certificate for every 356 riders--5,770 certificates total--at a cost of more than $400,000. In October, Amtrak figures show, the agency continued at a similar pace: It issued 6,003 service certificates worth $600,920, about one certificate worth around $100 for every 329 customers.

Amtrak’s ridership and revenue statistics for the month are also significant: Ridership was up 9.6% from the same period in 1999; revenue was up 13.4% to $96.8 million.

(If Amtrak achieves a month with less than one certificate for every 1,000 customers, each of Amtrak’s workers nationwide is to get a $50 bonus.)

Since May 23, Biztravel.com has been offering refunds to customers if their flights on American Airlines, Continental Airlines, Japan Airlines, British Airways, US Airways or Air France are late or canceled. (Southern California travelers may be dismayed to learn that the guarantee covers neither United Airlines nor Southwest Airlines, the two dominant carriers at LAX.)

The offer is the first of its kind, and it outstrips any assurances offered by airlines directly.

Under the guarantee program, U.S. fliers who purchase tickets through Biztravel.com for its chosen carriers can apply for $100 refunds if their flights arrive 30 to 60 minutes late. If the delay is 60 to 120 minutes, the refund maximum increases to $200. If the delay exceeds two hours (or the flight is canceled for any cause other than a mechanical problem), Biztravel.com said it would give passengers a full refund.

The program also includes compensation for lost luggage (up to $200), fouled-up seat assignments or unavailable meal entrees in business and first class (up to $25 in each case). The site even offers $10 when its customer service staffers don’t answer the phone within 90 seconds or respond to e-mail within two hours.

To qualify for compensation, travelers must file claims by phone or the Internet within 24 hours. (Biztravel.com also pays off in cases of weather delays but asks customers to “use your best judgment” on whether it’s fair to seek such compensation.) The company pledges to approve or disapprove a claim within 48 hours and deliver refunds within three weeks.

The Biztravel.com site has been selling travel online since 1997 but was bought in August 1999 by Philadelphia-based Rosenbluth International, one of the nation’s largest travel management companies. (Minority investors include Continental and British Airways.)

Biztravel.com declined to disclose revenue figures. But Justin Shaw, vice president and general manager, said the company’s customer service department has a staff of about 35 and that sales volume has increased about 55% since May. Shaw attributed most of that to the guarantee, which received widespread media attention. Though he declined to give specifics, Shaw said that “fewer than 10%” of the Web site’s customers have sought refunds.

Although business travelers are the site’s target audience, Shaw said the guarantee has helped boost the number of leisure travelers using the site to an estimated 25% to 35% of its bookings.

For July, August and September, U.S. Transportation Department statistics show that Biztravel.com’s three largest guaranteed airlines--American, Continental and U.S. Airways--flew an average of 75.1% of their flights on time. Among all 10 major U.S. carriers, the average was 72.7%. For Southwest it was 78.8%. At United, the tardiest of the major carriers, just 51.6% of flights landed on time.

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Christopher Reynolds welcomes comments and suggestions but cannot respond individually to letters and calls. Write Travel Insider, Los Angeles Times, 202 W. 1st St., Los Angeles, CA 90012 or e-mail chris.reynolds@latimes.com.