Jan 7, 2020, 1:43 pm
Last edit by: Prospero
Dynamic Award Pricing means award prices in miles will present with pricing dependent in accordance with supply and demand driven cash prices rather than by displaying static award prices on a published chart. Delta and United Airlines, among others, already offer dynamically priced awards, rather than pricing static miles costs on a chart.
Dynamic Award Pricing was initially introduced with multi-tier AAnytime awards, and expanded with the Economy Web Special awards listings added to the standard award display at the end of October, 2018 and fully operational in 2019. This means an award can price as a a lower than usual Economy Award Special or an AAnytime award as high as >400,000 miles for a one way longhaul award.
Links
Link to Economy Web Special" Award (dynamic price, fewer miles, more restrictions Oct 2018) (FT, 29 Oct 2019)
Link to AAnytime award dynamic tiers: higher costs coming to S Pac "late" Sep 2016 (AAnytime to SoPac can price at 375,000 J and 420,000 miles F.)
Link to Anytime / AAnytime award / awards [master thread] (Discusses three tiers and hidden fourth tier for AAnytime Award Pricing)
Articles:
link to American Airlines Dynamic Award Pricing is Here (Alongside Regular Awards) by Gary Leff on April 18, 2019
link to American Airlines Says Dynamically Pricing Awards is Coming by Gary Leff on May 30, 2019
Link to American Airlines Confirms That Dynamic Award Pricing Is Coming by Darren Murph May 30, 2019
Dynamic Award Pricing was initially introduced with multi-tier AAnytime awards, and expanded with the Economy Web Special awards listings added to the standard award display at the end of October, 2018 and fully operational in 2019. This means an award can price as a a lower than usual Economy Award Special or an AAnytime award as high as >400,000 miles for a one way longhaul award.
AA effectively moved toward dynamic pricing with the roll out of Economy Web Specials in October, with JT Genter noting the following: The appearance of discounted awards costing 9,500, 10,000, 10,500 and even 13,500 miles on a route where the standard rate is just 7,500 miles is quite concerning. Hopefully this is just a bug in the rollout, and not the first step toward a revenue-based redemption program like what weve seen Delta transition to over the past few years. - JT Genter, quoted in TPG - link
(On 30 May 2018) Senior Vice President of Revenue Management Don Casey said dynamic pricing of awards is a strategy theyre using to drive higher revenue from the loyalty program. More mileage redemptions means recognizing more deferred revenue, and redemptions at a higher mileage price does too. = G. Leff, see below for link
Weve said publicly were adding dynamic awards called web specials. Because weve received positive customer feedback so far and we will continue to roll out web specials. Some of the coverage were seeing now is pure speculation more web specials only mean more web specials for now. No decision has been made on anything beyond that. That said, we love when customers redeem miles. If TPG readers are thinking about a big, fancy trip, we hope they take it. Wed love to serve them soon. AA to TPG, 30 May 2019 (link below)
Link to Economy Web Special" Award (dynamic price, fewer miles, more restrictions Oct 2018) (FT, 29 Oct 2019)
Link to AAnytime award dynamic tiers: higher costs coming to S Pac "late" Sep 2016 (AAnytime to SoPac can price at 375,000 J and 420,000 miles F.)
Link to Anytime / AAnytime award / awards [master thread] (Discusses three tiers and hidden fourth tier for AAnytime Award Pricing)
AAnytime awards
With no blackout dates, you can use AAnytime awards for any seat on an American Airlines or American Eagle flight for as low as 20,000 miles each way, plus any applicable taxes and carrier-imposed fees.
AAnytime award levels vary by date (including time of day) and region. There are select dates that require a higher number of miles (in addition to Level 1 and 2 awards, there is a hidden level 3 based on aspirational value and premium product and even some hidden level 4 award space released on Flagship transcontinental flights). When you search for awards while booking, youll see the applicable available award level.
With no blackout dates, you can use AAnytime awards for any seat on an American Airlines or American Eagle flight for as low as 20,000 miles each way, plus any applicable taxes and carrier-imposed fees.
AAnytime award levels vary by date (including time of day) and region. There are select dates that require a higher number of miles (in addition to Level 1 and 2 awards, there is a hidden level 3 based on aspirational value and premium product and even some hidden level 4 award space released on Flagship transcontinental flights). When you search for awards while booking, youll see the applicable available award level.
link to American Airlines Dynamic Award Pricing is Here (Alongside Regular Awards) by Gary Leff on April 18, 2019
link to American Airlines Says Dynamically Pricing Awards is Coming by Gary Leff on May 30, 2019
Link to American Airlines Confirms That Dynamic Award Pricing Is Coming by Darren Murph May 30, 2019
Dynamic AAdvantage Award / Drastically High Pricing (master thread)
Jun 1, 2019 | 3:04 am
#31
Join Date: Nov 2014
Posts: 258
I guess the pitch does not bother me because Ive been able to use CCs to generate and use over 300,000 AA miles per year for international award redemptions, including two long haul legs on AA metal.
Jun 1, 2019 | 3:21 am
#32
Join Date: Sep 2002
Location: Thousand Oaks, Ca., USA
Programs: AA Lifetime Plat; Bonvoy Titanium Lifetime Elite;Hyatt Globalist; HHonors Diamond; United Silver
Posts: 9,966
I figure the value will be set at somewhere around a penny a mile. So J from LAX-LHR on a 77w nonstop will be upwards of 500k miles fairly often.
The pitch drives me nuts with its blatant fraud. Even with noise reduction headphones on.
The pitch drives me nuts with its blatant fraud. Even with noise reduction headphones on.
Jun 1, 2019 | 1:34 pm
#33
Join Date: Aug 2012
Programs: AA PLT, SPG Gold
Posts: 2,441
What makes you think itll be that cheap? South Pacific awards have been as high as 375,000 miles one way Business and 420,000 one way First since September 2016. (Current chart cost are 40,000 Y, 80,000 J, 110,000 F for MileSAAver, to compare.) It might be that st times, but when demand is high, Id expect higher costs.
Jun 2, 2019 | 1:37 am
#34
Join Date: Feb 1999
Location: City with Tax-Payer subsdized AA Maintance Base
Programs: Enough to Cause a Migraine
Posts: 1,862
We have Southwest to thank [blame] for this.
They were the first U.S. Airline to establish dynamic pricing, correlating to fare value, for frequent flyers, with RR 2.0
It wasn't terrible until Southwest went away with their cheap, last minute fares.
Now Southwest's last minute fares are laughable.
They were the first U.S. Airline to establish dynamic pricing, correlating to fare value, for frequent flyers, with RR 2.0
It wasn't terrible until Southwest went away with their cheap, last minute fares.
Now Southwest's last minute fares are laughable.
Jun 2, 2019 | 4:32 am
#35
FlyerTalk Evangelist
Join Date: Jul 2003
Location: KARB
Programs: DL 2MM
Posts: 26,991
We have Southwest to thank [blame] for this.
They were the first U.S. Airline to establish dynamic pricing, correlating to fare value, for frequent flyers, with RR 2.0
It wasn't terrible until Southwest went away with their cheap, last minute fares.
Now Southwest's last minute fares are laughable.
They were the first U.S. Airline to establish dynamic pricing, correlating to fare value, for frequent flyers, with RR 2.0
It wasn't terrible until Southwest went away with their cheap, last minute fares.
Now Southwest's last minute fares are laughable.
Jun 2, 2019 | 9:36 am
#36
Join Date: Oct 2003
Location: DCA
Programs: UA LT 1K, AA EXP, Marriott LT Titan, Avis PC, Hilton Gold
Posts: 9,926
Be thinking what UA is now charging for their flights to Europe - 57K for Economy, 120K for Premium Economy 155K for business (one way). At least for now, partner flights are still at the old levels (as well as less popular UA routes) at 30K Economy.
Jun 2, 2019 | 11:17 am
#37
Join Date: Apr 2016
Location: San Diego
Programs: GGL
Posts: 1,274
Looks like they will have to modify the credit card spiel to say “60,000 miles MIGHT get you two round trip rewards, depending on the time of day/year and current flight loads, but don’t bank on it”! 
Jun 2, 2019 | 12:22 pm
#38
Join Date: Jun 2009
Posts: 2,480
folks - has AA implemented this for all routes? I'm planning for a trip 10 months out to india where J has traditionally been 70k o/w and plenty of availability if you book this far ahead
thx
thx
Jun 2, 2019 | 1:08 pm
#39
Moderator: American AAdvantage
Join Date: May 2000
Location: NorCal - SMF area
Programs: AA LT EXP; HH LT Diamond, Matre-plongeur des Muccis
Posts: 62,948
We wont know the full effects until an official announcement is made. But it would be easier to inflict, er apply, this to all routes than to some, IMO.
Jun 2, 2019 | 3:51 pm
#40
Join Date: Sep 2002
Location: Thousand Oaks, Ca., USA
Programs: AA Lifetime Plat; Bonvoy Titanium Lifetime Elite;Hyatt Globalist; HHonors Diamond; United Silver
Posts: 9,966
In my experience, traditionally Etihad has been a pain (at least for F), not sure about QR but plenty of availability sounds like a pretty ancient tradition
Jun 3, 2019 | 5:50 pm
#41
Join Date: Feb 1999
Location: City with Tax-Payer subsdized AA Maintance Base
Programs: Enough to Cause a Migraine
Posts: 1,862
WN was the first major US carrier, but VX and B6 predated them by several years. More than likely, WN got the idea from those carriers. The reality is that the legacy dynamic awards are more of hybrid system where redemption values tend to more closely follow revenue fares, but the correlation is not nearly as predicable as with WN.
Yes, B6 and VX had Dynamic Award pricing first, but again, the blame falls on WN.
B6 and VX had Dynamic Award Pricing since the inception of their programs; WN did not. B6 and VX had nothing to change in terms of their Award Pricing.
The Big 3 Legacy carriers were waiting for one of the other Big 3 carriers to first change their FFP’s Award redemption structure to Dynamic Award Pricing model. Except Southwest beat them to it instead.
Perhaps WN picked up their model from B6 or VX, but as you agree, Southwest was the first *major* carrier to adopt the change from a static redemption to a dynamic model.
The change WN did is having a ripple effect which will eventually have all the Big 3 carriers also change their FFP’s Award Pricing.
Jun 11, 2019 | 11:16 am
#42
Join Date: Sep 2000
Location: MCO
Programs: Marriott Lifetime Platinum, AA Platinum
Posts: 1,125
What is ironic is that on every AA flight, they tell you that if you sign up for a credit card you get a (for example) 50k mileage bonus enough for two round trip flights in the US as a selling point. Not any more!
If you remember many years ago when miles were earned on distance and then the credit cards appeared awarding 1 mile to the dollar, at that point, due to inflation, they had no choice but to eventually get to a revenue based system. They have done it gradually, shifting the earn to revenue and now the burn.
I prefer the way hotels like SPG handled it by having a chart and just bumping categories when necessary - at least it gave you something to target with your point earnings. Now, with dynamic pricing, they dont have to wait for an annual chart rollout, they can bump prices daily and make points as worthless as they want.
Part of the allure in the points game is finding a sweet spot. If they go all revenue and dont give good value opportunities for using points, they will be hurting the mile selling industry they created as people wont be as likely to use the credit cards.
If you remember many years ago when miles were earned on distance and then the credit cards appeared awarding 1 mile to the dollar, at that point, due to inflation, they had no choice but to eventually get to a revenue based system. They have done it gradually, shifting the earn to revenue and now the burn.
I prefer the way hotels like SPG handled it by having a chart and just bumping categories when necessary - at least it gave you something to target with your point earnings. Now, with dynamic pricing, they dont have to wait for an annual chart rollout, they can bump prices daily and make points as worthless as they want.
Part of the allure in the points game is finding a sweet spot. If they go all revenue and dont give good value opportunities for using points, they will be hurting the mile selling industry they created as people wont be as likely to use the credit cards.
Jun 12, 2019 | 9:11 pm
#43
Join Date: Jan 2018
Location: BGI | MIA
Programs: AA Platinum Pro | Hyatt Globalist | HH Diamond | SPG Gold
Posts: 318
Huge AA devaluation. Dynamic pricing has started ?
Was doing some searches this evening for awards.
seems like dynamic pricing is already in effect.
DFW-MEX in December 80,000 miles for a 2 hour hop in economy. 😲
RT to HongKong for 280,000.
Major blows to the AA program
seems like dynamic pricing is already in effect.
DFW-MEX in December 80,000 miles for a 2 hour hop in economy. 😲
RT to HongKong for 280,000.
Major blows to the AA program
Jun 12, 2019 | 10:09 pm
#44
Join Date: Mar 2006
Programs: AA EXP, UA 1K, F9 Elite, Hyatt Diamond, Hilton Diamond, Marriott Gold
Posts: 1,323
I just find the dynamic award pricing confusing, and that is what will anger frequent fliers the most, and delight the Kettles at the same time. For example, my Mother and I are traveling to Rome next month, and I started looking weeks ago. To my amazement, there was saver coach everywhere from SLC to FCO, no business. Then I checked PSP to FCO, and while horrible red-eyes and layovers, saver J was peculiarly available on some of the SAME flights I was only seeing available in coach from SLC (PHL-FCO). So I booked the horrible itinerary for both of us (yes TWO AA sAAver J seats were available, my heart almost stopped). I checked from ONT, SNA, LAX, BUR, and the same seats could not be replicated.
A week later I checked again, still no luck out of SLC, but suddenly ONT-FCO opened in J for 2 at sAAver with a much better itinerary, so I rebooked the ticket. But LAX, SNA, BUR, PSP...no love. And checking the non-stop long haul to Europe that I was about to book (DFW-MAD) of course showed no sAAver J space. So while it worked out for us, this whack-a-mole strategy from AA is really obnoxious and just makes frequent flyer programs even more of a complexity that average fliers will love to hate. Why can't we just have more transparency???
A week later I checked again, still no luck out of SLC, but suddenly ONT-FCO opened in J for 2 at sAAver with a much better itinerary, so I rebooked the ticket. But LAX, SNA, BUR, PSP...no love. And checking the non-stop long haul to Europe that I was about to book (DFW-MAD) of course showed no sAAver J space. So while it worked out for us, this whack-a-mole strategy from AA is really obnoxious and just makes frequent flyer programs even more of a complexity that average fliers will love to hate. Why can't we just have more transparency???
Jun 12, 2019 | 10:23 pm
#45
Join Date: Dec 2004
Posts: 5,820
What you have just discovered is called "AAnytime awards". They have been around for many years. SAAver awards are lower-priced, and so far their prices are fixed; but since they are not available here, the price does not matter.
AA is presenting these mileage costs without identifying them as AAnytime. That is relatively new.
AA is presenting these mileage costs without identifying them as AAnytime. That is relatively new.