Over the last few months, we’ve seen the economy take a turn for the worse. We’ve seen the travel industry suffer the impact of the pandemic and the lockdowns that followed. Travel continues to be at historic lows as many countries still have travel restrictions in place. In response to the pandemic and the ensuing uncertainty, many airlines and hotels have responded by offering flexible cancellation policies. However, what happens when an airline simply keeps canceling the flight but continues to refuse a refund? Much to my chagrin, it happened. Here’s a detailed account of how it unfolded.

Airline cancels 3 flights, continues to refuse refund

My parents had booked a round-trip SpiceJet flight from Mumbai (BOM) to Dehradun (DED) for travel during the months of May-June 2020. Due to the Covid-19 outbreak in India and the subsequent lockdowns, SpiceJet notified them that their flights had been canceled. Their travel funds would be placed in a ‘credit shell’. In short, a credit shell is like any other travel bank fund.

Reusing the Funds

My parents had to book a round trip flight for a doctor’s appointment scheduled for October 5th. I decided to reuse their ‘credit shell’ and booked a round trip flight from Mumbai (BOM) to Hyderabad (HYD). I was under the assumption that everything was under control.

Flight Canceled

On September 28th, SpiceJet canceled the inbound flight from BOM to HYD for operational reasons. I quickly scrambled and reached out to them. Again, no refund, only money that they’d put back into their ‘credit shell’. However, I was running short on time and rebooked flights using the credit shell. I thought I’d averted a crisis and ensured that my parents make their appointment. I was wrong.

Flights Canceled, again

On September 30th, 4 days before the travel date, SpiceJet canceled the flights again. However, they made sure to really rub salt into the wound by canceling both the inbound and outbound flights. I reached out to their customer service via chat and Twitter, explaining that I need a refund since SpiceJet canceled both flights abruptly and I need to ensure that my parents make the doctor’s appointment as scheduled.

Lack of Empathy

I reached out to SpiceJet’s customer service via multiple channels to explain the situation. My parents, both senior citizens, needed to make a doctor’s appointment and only SpiceJet’s flight cancellations were stopping them from doing so. Also, I explained that I’d reused the travel funds as a customer in good faith to rebook two flights, both abruptly canceled by SpiceJet close to the travel date. However, their customer service reps simply refused to budge.

My interaction with them showed up something which I’ve discussed before on the blog. It’s a classic case study how a bad customer experience can simply drive away customers. During my interaction with SpiceJet reps, I realized a couple of things.

Firstly, they showed a lack of nuance or empathy. In spite of my repeated explanations, they just didn’t seem to understand the importance of the trip. Secondly, they didn’t seem to be properly trained to handle the situation. The answers I received seemed to be from a training manual where reps are simply taught that if X happens, do Y.

The Resolution (Sort Of)

In the end, SpiceJet simply canceled the flights and credited the money back into the ‘credit shell’, the airline simply continuing to refuse a refund to the original form of payment. Thankfully, I was able to book flights on Air Vistara. Air Vistara (run by the Tata Group) is in a joint venture with Singapore Airlines. Luckily, I was able to find award seat availability and booked last minute flights for my parents on Air Vistara, using my Singapore Airlines miles.

The Death of Loyalty

After all the back and forth of dealing with different reps and the clock running out to ensure that my parents make their flight, I then sat back over the weekend and looked at the whole situation from a customer loyalty perspective. This was a classic case of a company preferring short term revenue at the expense of customer loyalty. The airline simply wanted to keep my money, refuse a refund and ensure that I’d book again. However, it’s resulted in the exact opposite outcome. The only incentive that I have left now is to use those funds on a future flight and never fly SpiceJet in the future once that is done.

The Buyer’s Journey – Building Loyalty

Companies spend millions on Marketing to attract and acquire customers. Once the customer is acquired, a company would ideally like to deliver a quality product/service, backed by excellent customer service. If done successfully, this persuades the customer to make repeated purchases. Such repeated purchases and positive experiences eventually result in what we call as loyal customers. The most successful brands are the ones who convert their most loyal customers into brand advocates. These brand advocates refer their friends, family and co-workers, who again flock to the brand to give them repeated business.

Customer loyalty is a tough gig. I’ve written previously about how certain brands do it really well. For example, American Express has often wowed me with their customer service. Similarly, Hilton has rewarded me for my loyalty by taking great care and fixing things when they’ve gone wrong, thereby ensuring my repeated business in the long run.

In short, SpiceJet may have kept about $200 of my money, but they’ve ensured that I’ll never be convinced to do any of the things in the two paragraphs above. They’ve also ensured that I switch to their competitor Air Vistara, which provided my parents with a much better overall travel experience.

Cheap is Expensive

India is a gorgeous country and I’ve spent a lot of time traveling around its vast expanse. However, if you’re planning to book a domestic flight, you must remember that cheap can often be expensive. If you have a choice and can spend a few extra bucks, I’d recommend that you go for a better customer experience instead of simply booking the cheapest flight available.

The Pundit’s Mantra

While we all feel for what travel industry employees must be going through and cheer for a quick revival, such experiences simply make you realize that certain airlines simply want to use a crisis to make the customer experience worse at the expense of saving a few bucks.

In a nutshell, SpiceJet may have kept my money for now, but they definitely haven’t kept my business. I’m glad that I was able to book an Air Vistara flight, which saved the day in the end.


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Disclosure: The Points Pundit receives NO compensation from credit card affiliate partnerships. Support the blog by applying for a card through my personal referral links. This article is meant for information purposes only and doesn’t constitute personal finance, health or investment advice. Please consult a licensed professional for advice pertaining to your situation.