Southwest Airlines 2011 Annual Report Download - page 14

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points, such as the opportunity to book in advance to take advantage of a lower fare (including a fare sale) ticket
by redeeming fewer points or by being able to redeem more points and book at the last minute if seats are still
available for sale. Rapid Rewards Members can also earn points through qualifying purchases with Rapid
Rewards Partners (which include, for example, car rental agencies, hotels, restaurants, and retail locations), as
well as by using Southwest’s co-branded Chase®Visa credit card. In addition, holders of Southwest’s co-branded
Chase Visa credit card are able to redeem their points for items other than travel on Southwest, such as
international flights on other airlines, cruises, hotel stays, rental cars, gift cards, event tickets, and more. In
addition to earning points for revenue flights and qualifying purchases with Rapid Rewards Partners, Rapid
Rewards Members also have the ability to purchase points.
The All-New Rapid Rewards frequent flyer program also features enhanced A-List and Companion Pass
programs for the most active members and adds a new level of status, “A-List Preferred.” Both A-List and A-List
Preferred Members enjoy benefits such as “Fly By®” priority checkin and security lane access, where available,
as well as dedicated phone lines, standby priority, and an earnings bonus on eligible revenue flights (25% for
A-List and 100% for A-List Preferred). In addition, A-List Preferred Members enjoy free inflight WiFi on
equipped flights. Rapid Rewards Members who attain A-List or A-List Preferred status receive priority boarding
privileges for an entire year. When these Customers purchase travel at least 36 hours prior to flight time, they
receive the best boarding pass number available (generally, an “A” boarding pass). “A-List” or “A-List
Preferred” Customers are automatically checked in for their flight in advance of departure. Rapid Rewards
Members who fly 100 qualifying one-way flights or earn 110,000 qualifying points in a calendar year
automatically receive a Companion Pass, which provides for unlimited free roundtrip travel for one year to any
destination available on Southwest for a designated companion of the qualifying Rapid Rewards Member. The
Rapid Rewards Member and designated companion must travel together on the same flight, and the Rapid
Rewards Member must purchase a ticket for the flight or use a travel award.
The All-New Rapid Rewards frequent flyer program has been designed to drive more revenue by
(i) bringing in new Customers, including new Rapid Rewards Members, as well as new holders of Southwest’s
co-branded Chase Visa credit card; (ii) increasing business from existing Customers; and (iii) strengthening the
Company’s Rapid Rewards hotel, rental car, credit card, and retail partnerships. To date, the new program has
exceeded the Company’s expectations with respect to the number of frequent flyer members added, the number
of Southwest’s co-branded Chase Visa credit card holders added, the number of flights taken by members,
incremental revenues associated with members booking flights, and the number of frequent flyer points
purchased by program members.
During 2011, the Company began the process of integrating the frequent flyer programs of Southwest and
AirTran by offering top-tier status members of both airlines’ frequent flyer programs some limited reciprocal
benefits. For example, AirTran A+ Rewards members who book on Southwest are eligible for “A-List” benefits
on Southwest flights. In addition, Southwest “A-List” and “A-List Preferred” Rapid Rewards Members booking
on AirTran are eligible for free Business Class upgrades, no baggage fees, and all other benefits that AirTran’s
A+ Rewards members enjoy.
AirTran’s A+ Rewards frequent flyer program offers a number of ways to earn free travel including bonus
earnings for Business Class travel. AirTran Customers may earn either free travel or Business Class upgrades or,
under certain circumstances, free travel on other airlines. A+ Rewards members can earn a credit for each
one-way trip flown or 1.5 credits for one-way Business Class travel. A+ Rewards credits may be redeemed as
follows:
• One-way Business Class upgrade: 4 credits
• One-way Coach ticket: 8 credits
• One-way Business Class ticket: 16 credits
A+ Rewards credits can also be earned for purchases made with an AirTran Airways A+ Visa card, when
renting from Hertz, for purchases from other A+ Rewards partners, and in conjunction with marketing
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