Originally Posted by
AAExecPlatFlier
Don't see that AA has made a big mistake. Why should AA continue to flood a $4k/year EP with crazy ... benefits and mileage that for a DFW Hkg RT yields something like 32k miles for paying $499?
Basically buy one get a domestic ticket free. Crazy. DL survived. UA survived. WN survived when they went to $ spend. I think AA will be fine.
I've
always stated AA needs to make "tweaks" to its FF program. Making upgrades to F/J, etc. more difficult is fine - they do need to make some money there. AA could have differentiated themselves by having RDM miles earned as BIS + no bonus miles for no status and maybe a smaller bonus for GLD, PL, etc. I think earning MM status had to be BIS. As much as I didn't like it it was a good decision.^
Rather than making some subtle yet important changes, AA management decided to "gut" and mostly "copy & paste" their program.
Originally Posted by
Dave Noble
Most people fly on an aeroplane to get from A-B ; FF miles earning is a side benefit
Does it seriously seem to make sense that a buy 4 cheap economy r/ts , get a free business return was being offered? Does that seem anywhere near in line with other redemption schemes? Yes, it was great whilst it lasted, but seems hardly at all surprising
It may be less of an incentive to pay an extra $100, but there are those for whom lounge access, extra luggage allowance and shorter queues may be worth paying a bit extra
If in the group flying AA due to the rewards being worth more than the product purchased are not the group that AA is actually trying to encourage
Again, as mentioned, making some changes was quite important indeed.
Lets not forget, many (and possibly AA's) FF programs were profitable as well. IIRC, a coupe of carriers have even spun-off their FF programs.
Priority boarding as well as lounge access (in AA's case pay $50 for lounge access), 1 free luggage, etc. now be purchased or can be acquired via credit cards .
Originally Posted by
akcae
As argued again and again and into oblivion, the point of FFP is to keep people loyal even when the cost/schedule/comfort/convenience combo isn't the best to capture the marginal/fungible spend of your customers. If AA offers me a $400 fare to HKG on the dates I need to go, I'm buying it regardless of miles earned. FFP is there to steer my $$ to AA when it is offering a $600 fare, while UA is offering a $500 fare. Or to induce me to buy it just because it's cheap enough even if I had no plans to go to HKG.
Pre-8/1, my $600 spend on AA earned me ~32K miles on AA (as EXP, 16K for non-elite), but only 2200 - 5000 miles on UA (depending on taxes and elite level). Now AA earning is the same. Even if I'm EXP and have no status on UA, why would I pay an extra $100 to AA, to earn maybe 2000 more miles? I can buy them from AA for cheaper than that without spending 30hrs on the plane.
^ Not to mention, that person who is purchasing that $400 fare to HKG (why is AA selling that price fare to HKG in the first place?
) will also purchase a SFO-ORD roundtrip ticket for $400 when Frontier is selling that same route (same days, etc) for <$300.
Add the fact one who is loyal to AA might get the AA CitiCard, spend money on lounges, pay change fees, take his family on a paid vacation on AA etc.
Originally Posted by
Dave Noble
That is a pretty low fare ( I class ) so a pretty reasonable assumption that people are paying that fare
Indeed , AA is more expensive and I would agree that CX is definitely a better airline, but maybe some may be tempted by the extra miles - or at least perhaps booking an AA codeshare on CX
Booking an AA codeshare on CX however is more expensive (from what I've seen).