tom911

Just a note that Suzanne Rubin, the author of the letter you posted, will be the featured guest in a Milepoint chat on June 19. LINK

Time traveller

In the past, AA EXPs were quite well taken care of, whether via a dedicated phone desk or with most GA/FAs. I hope the sudden increase in the number of EXPs (with 1K matches and extensive DEQMs for CA, TX, IL residents) will not "de-value" the EXP status to something similar to what UA 1K has become over the past year or so.

Thunderroad

I think the short answer to your concern is that AA can't calibrate it's offers to please everyone and that it is most interested in attracting new customers. In the best of all possible marketing worlds, it might well target folks in your position. But that involves a level of precision it understandably can't achieve.

+1

Even if there's an argument to be made for making an extra effort to retain current AA customers, there's a bigger one for attracting dissatisfied FFers from another airline.

Good explanation by SG. Just to expand on it a bit and provide some general background, you achieve status on AA by either accumulating either elite qualifying miles or elite qualifying points. Either one will get you there. Virtually all AA flights, no matter how discounted a ticket, get you one EQM per mile flown. EQPs differ according to the ticketing code. E.g., discounted economy tickets only get you .5 EQPs per mile flown. But business class tickets get you 1.5 EQPS per mile flown. So you can reach EXP by flying 100K miles in discounted economy (yielding 100K EQMs) or via 66.7K miles in business (yielding 100K EQPs).

AAExPlat

Ok...so just to be sure this is properly explained...EQP and EQM can't be mix and matched, so in this case, the poster will have to EITHER fly 70k EQMs OR earn 55k more points. Flying 55k EQMs in discount coach or coach won't get him to EXP...

Regarding the assertion that attracting new business is more important than retaining and enhancing existing business is just plain wrong. New business is far more likely to leave again than existing long term business. That's why every business worth its salt will work hard on retaining existing business at all cost.

This is precisely the lesson that UA is about to learn. And it is the lesson AA will need to avoid having to learn.

cover point

Agree. To me giving that exp match for free was a fair marketing move that I equate to companies giving out free samples to first time customers. But to have different rules for new customers vs your loyal old timers is nothing but dissing and taking for granted your existing exp base.

Loyalty is supposed to be two way street. As an exp who has recently missed some upgrades ( when not missing any for most of the last 4 years) this does annoy me.

A healthy AA is good for everyone I would agree. But I for one dont appreciate being taken for granted and would consider my loyalty to AA reduced moving forward. I understand AA needs new customers but assuming retaining old customers would be important too. I have been EXP based mostly on J class international travel and always qualify on points. You would think my satisfaction should be as important to AA as any UA 1K.

Not saying that I am running to UA but will evaluate my future travel more carefully. Let's see what UA counters with.

brp

This is not consistent. If existing business is not as likely to leave, what is the incentive to provide them incentive? They're not going anywhere anyway. So, it makes more sense to incent new customers to come over. Because then they become existing customers and are less likely to leave. So,your premise and defense contradict one another. (By the way, I agree with the defense as it shows why it makes more sense to incent new customers to come over )

Cheers.

gegarrenton

I really think the existing EXP's are going to be given an enticement before the year is out, so the hand wringing over the preferential treatment is a non starter. Just a wild guess by me, but I see it happening.

I think this is all a good thing.

AAExPlat

Not inconsistent to me...only to you because you make an assumption that I do not...namely that the new customers have no negative impact on existing customers. As soon as the new customers have a negative impact on the experience of existing customers, the latter might make different decisions than they otherwise would...

Under normal circumstances, existing customers are more sticky than new ones. When the experience for the existing customers worsens as a result of bringing on new customers, the existing customers will leave and many of the trialers will, too.

DFWDave

I'm not sure how AA appeases the existing PLTs and EXPs that were not otherwise at risk for losing EXP or a potential for ramping up to EXP.

In my example, with low travel in the last few years and 1MM Gold status, I would fly AA as much as possible, but with no possibility of PLT, I wouldn't sweat it if flight times or prices made more sense elsewhere. A drastic change in travel pattern constituted a going-forward buying decision for me that was only partly tied to my previous loyalty. It didn't change my airline loyalty (could have), but it DID drastically change my hotel behavior compared to previous high travel periods in my career.

Ergo my argument that a challenge is in order for someone who's situation has changed and would benefit from such a plan, even with a charge of, say double the rate of a PLT challenge and a more aggressive hurdle (55K is 7 months for the 1Ks isn't much of a stretch). The same option is afforded to an existing GLD today to do a PLT challenge - they are not excluded just because they are already "loyal" customers. AA could decide to only offer EXP challenge to someone after successful completion of a PLT challenge (assuming they weren't already PLT), and start with a "fresh" clock/counter.

Some responses to my posts on this thread have made it seem like I'm in favor of something for nothing, but a fee-based challenge with an aggressive target is hardly such, and I believe is mainly warranted now after conferring status to travelers with proven travel track record, but not proven loyalty (to AA) with no such aggressive initial hurdle. Again, that status match by itself I believe is probably a smart move on AA's part, but stings in the absence of a vehicle for a passenger who can demonstrate something along the lines of the 55K in 7 months being required of the 1Ks (to retain that status).

Other posts have mentioned a dilema with this idea that someone (non 1K status match) could fly the mentioned ~50K in the front half of the year to get EXP and then not fly the rest of the year. I suppose that is true, but it's kind of hard to take advantage of a status if you aren't on board a plane. Following that through to the following year, if they were granted that status all year, they would have to step up to the full requirements or lose it anyway. A lot of hoops, and money (using this idea) to go through if you weren't going to sustain it (i.e. why pay for a PLT challenge, especially in the 1st half of the year, if you had no chance/plans to continue frequent travel to benefit from it and also qualify into the next program year).

The old adage about it costing 10 times more money to gain a customer than to retain one - AA is showing they are willing to do the more expensive one (and new business is key to any enterprise), but may not realize that it through dilution and lack of offers to accelerate new or lower level elites who are starting to consistently fly at an EXP rate, that those new 1K EXPs cost them a whole lot more than some customers they lose (new business isn't actually good if it causes you to lose a lot of existing customers as a result).

At the end of the day, unless something strange happens, I'm not going anywhere, so I'm low risk. I'm just pointing out things that would likely entice/ensure the future loyalty of those who start or have the potential to start flying at the EXP pace. I want AA to succeed, in gaining new customers (organically and from targeting competition), and also by retaining and GROWING the spend and loyalty of their existing customers.

Sorry for the long-winded (paraphrased) response to multiple posts in this thread.

BCS1K

+1, you are absolutely correct. That is why you see sign up bonus for new credit card customers, non for existing customers. Im sure very few existing customers cancel their cards because of bonus miles for new customers.

Every business has a "churn rate." You lose customers for several reasons, death, unemployment, relocation, customer dissatisfaction, cheaper alternative, new product.

I was perfectly happy with Verizon, however I switched to ATT for the iPhone. Now Verizon has the iPhone, however, im still with ATT.

smashr

So I'm wondering about the status of the SWUs. I was in the original batch of matches which were simply comped the 8 SWUs with a Feb 2013 expiration. So, if I complete the 55k this year to requalify (which is doable for me), will I:

1) Get another 8 SWUs with a Feb 2014 expiry?
2) Have the balance of my existing 8 SWUs extended to Feb 2014?
3) Not recieve any SWUs and be SWU-less in 2013?

2 seems to be the most "fair" to me, while 1, of course, would be awesome. I'm mainly just hoping to avoid 3.

Any thoughts?

brp

The problem I see with this is that it could apply every year. Setting a precedent for allowing existing customers a shortcut to EXP if they happen to be behind is, IMO, a bad idea. I see the point that maybe they should do it just this once since they're doing the UA thing. I just don't see that it would stop there in people's expectations.

In any year, there are AA fliers that might "fly more" with a reduced incentive. I don't think it's a good idea to provide this incentive. If people want a status, they should earn it. Even challenges should be once-per-lifetime, IMO.

Cheers.

BCS1K

That is very interesting. Send an email to Aadvantage CS. Please share their reply.

DFWDave

The current GLD/PLT challenge options do not allow you to challenge to maintain a status you were otherwise doomed to lose or recently lost (you can't do it two years in a row, and if you were PLT in year X-1, you can't challenge in year X).

I would be in favor of a more long term option, with a once every five year limitation, or something like that. At a minimum, should be a choice offered parallel to an offer to someone being status matched.

I'm sure part of the 1K match is to show the UA customers what EXP feels like. I suspect most of those 1Ks have flown AA before, maybe even to a GLD status, so they aren't completely foreign to AA. I suspect, similarly, there are non-elite, GLD, and PLT AA customers that are (or could be) funneling travel to AA, but might not even fully appreciate what EXP has to offer. PLTs that find themselves pushed further down the upgrade list might be faced with a choice or even an offer to jump ship, and with no compelling challenge offer from AA, it could be more likely many will go.

I WILL make EXP this year and my travel didn't even start until May 1 (zero miles YTD prior to that, 50K EQMs May 1 - July 31 with no mileage runs or extraneous segments). I was dumb, fat, and happy to be on that trajectory and would get to EXP with upgrades few and far between along the way, until instant EXP was granted about the same timeframe, with a reduced hurdle to maintain through Feb 2014. I'll have to fly nearly twice as much in the same timeframe, and without having EXP status until I get there unlike the 1Ks. Can't say enough, not mad at the 1Ks and it's a wise idea, but not without something in place to help an existing customer ratchet things up also.

fieldeng

ironmanjt,
Take note of the upgrade policy differences between UA and AA. There are a few threads out there explaining how different the 2 are.