Originally Posted by
Tango
My two cents on these changes:
Mileage redemption is taking a hit.
Mileage earning is taking a hit.
Program rules are becoming very complex and that is the worst thing.
Simplicity and full transparency always trump everything else and the Advantage program is becoming needlessly complex.
Filling the back of the aircraft is just as important as selling business and first class cabins. The new program does not promote this as the people in the back of the plane will pay more attention to price, not loyalty.
American has not figured out that the most valuable customers are the ones in premium economy. British, CX and Qantas have figured this out. AA obviously is behind the curve on this.
Just wait for the 2017 enhancement (that they will announce late 2016)---a minimum spend requirement ala Delta and United.
It would have been refreshing to see AA come out with a really innovative program as they were the ones that created the frequent flyer program. What we have now is a needlessly complicated cut and paste program from Delta.
Yep.
It's also not zero-sum, i.e. more is being taken away from some than is being given to others. A revenue play, in other words, brought to you by consolidation and oligopolistic behavior. The U.S. oligopoly is treating its passengers much like European national carriers have treated theirs for years, i.e. we don't really think we have to work that hard (anymore) for your loyalty.
I switched the mile accumulation to AA this year but hedged a bit by just getting to gold mostly on one Asia trip. Low-fare Asia, India and Middle East travelers get hit hardest, giving an opportunity for the GULF carriers to come in if they have a better deal (also Chinese/Taiwanese ones flying to the west coast).
Another airline that could capitalize if smart is Spirit, as they will have (for now at least) a more generous program on RDMs. Unfortunately they also have Ben Baldanza, who was bad about trying to make programs less generous while at US and is a bad candidate for being a white knight here. Then again, maybe he can change his ways and start promoting the Spirit program as more rewarding, since NK and AA are in a price war on many routes.
Eventually the infrequent-flying Joe Sixpack will listen to enough local news reports or others and get the message that you just don't earn enough miles by flying anymore to make it worthwhile. And the tie-in promotions won't help you that much, either. For a credit card you'd need a level of annual spend higher than most peoples'...if you need 3 or 4 years to get to an award then you've "paid" for the free ticket in annual fees, so you might as well go a different route with a cash back card or something like that.
Would agree that the losses will start in the back of the plane, especially if WN and the LCCs and ULCCs can spot the opportunity and take their own FFPs more seriously (starting with loosening the expiration policies).
The revenue-play part of this smells very much like it's being egged on by Wall Street, which of course has a history of pushing moves for short-term gain that blow up in the long term. In this case that'd be at the next black-swan event like 9/11 or SARS or something like that, when they'd find the mailing list with the engaged and semi-engaged way depleted. Focusing on a relative few "quality" customers won't help you then, as those people have to travel for business anyway and don't have much ability to give you more business. Run off the coach passengers to LCCs and ULCCs and it'll be hard to get them back. A weakened Oneworld also won't be much to crow about.
I can't say this was unexpected but it's nonetheless disappointing.