Frequent Fliers If You Think George Clooney's Character in the Movie Up

question 35

Multiple Choice

Frequent Fliers
If you think George Clooney's character in the movie Up in the Air was pure fiction, think again. Clooney portrayed a frequent flier who enjoyed top-of-the-line perks the likes of which even most "elite" fliers don't experience. That's because he was a member of American Airline's invitation-only ConciergeKey recognition program. Most airlines maintain these unpublished super elite frequent-flier plans, such as Continental's Chairman's Circle and Delta's Executive Partner programs. These programs are reserved for the highest-volume customers in terms of miles flown or highest-value in terms of revenue. You'll have to fly upwards of 300,000 miles or spend $50,000 a year to be invited.
-Refer to Frequent Fliers. Airlines have estimated the future value of these elite fliers and found that they are very profitable for their business. What technique did the airlines use to project the future value of these fliers over a period of several years?

• A) RFM analysis
• B) lifetime value analysis (LTV)
• C) cluster analysis
• D) conjoint analysis
• E) data enhancement analysis

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Definitions:

Nominal Rate

The stated interest rate of an investment or loan, without adjustment for inflation or other factors that affect the real rate of return.

Rate Of Inflation

The percentage increase in the general level of prices for goods and services in an economy over a period of time.

Rate Of Unemployment

The proportion of individuals in the labor force who are not currently employed but are actively seeking employment.

Discouraged Workers

Discouraged Workers are individuals who are not actively seeking employment due to believing no jobs are available for them or there are other barriers to employment.