AAdvantage President Bridget Blaise-Shamai Leaves; Whither AAdvantage?
Jun 4, 2020, 9:19 pm
#31
Moderator: American AAdvantage
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Vasu Raja has moved through planning, strategy, revenue management, etc. Some of his ideas, published last year: https://www.bizjournals.com/dallas/n...-airlines.html
Jun 4, 2020, 9:46 pm
#32
FlyerTalk Evangelist
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It isn't going back to mileage based ever. Its a pipe dream.
Jun 4, 2020, 9:49 pm
#33
Join Date: Jul 2011
Posts: 2,313
Prediction:
We will see one of two options:
1. American invented the Frequent Flyer Program, so they have the option to do that all over again.
Come up with an entirely new way of thinking about the relationship between the customer and the airline and who should be rewarded and how.
I like some of the ideas (family plans) discussed here but there exists the possibility of "something" completely different, not that I know what that is, but then Aadvantage was "completely different when it came out in the 1980's.
For a "new program" to be viable, it would have to be revenue neutral, pull passengers from other carriers in significant numbers (especially high value customers) and be able to be implemented without much change to their current IT base. Talk about a difficult challenge
.
2. Dissolve Aadvantage completely. It has become dysfunctional for the traveler as so many of you have pointed out, costly for the airline, and it would seem that it no longer functions well for its original purpose of building brand loyalty and revenue for AA. In the current economic environment, the allure of any kind of "cost savings" must be enormous.
Although the benefits of #1 are large, #2 is the the more likely choice IMHO.
.
We will see one of two options:
1. American invented the Frequent Flyer Program, so they have the option to do that all over again.
Come up with an entirely new way of thinking about the relationship between the customer and the airline and who should be rewarded and how.
I like some of the ideas (family plans) discussed here but there exists the possibility of "something" completely different, not that I know what that is, but then Aadvantage was "completely different when it came out in the 1980's.
For a "new program" to be viable, it would have to be revenue neutral, pull passengers from other carriers in significant numbers (especially high value customers) and be able to be implemented without much change to their current IT base. Talk about a difficult challenge
.2. Dissolve Aadvantage completely. It has become dysfunctional for the traveler as so many of you have pointed out, costly for the airline, and it would seem that it no longer functions well for its original purpose of building brand loyalty and revenue for AA. In the current economic environment, the allure of any kind of "cost savings" must be enormous.
Although the benefits of #1 are large, #2 is the the more likely choice IMHO.
.
Whatever it is they're doing, it's because it has value.
#1 is unlikely too. They're not gonna reinvent anything. Unless Delta does first and they copy.
Jun 4, 2020, 10:48 pm
#34
Moderator: American AAdvantage
Join Date: May 2000
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Yeah, #2 not gonna happen. The AA FF program is profitable. They're offering the AAdvantage program as collateral for more loan guarantees or something, right?
Whatever it is they're doing, it's because it has value.
#1 is unlikely too. They're not gonna reinvent anything. Unless Delta does first and they copy.
Whatever it is they're doing, it's because it has value.
#1 is unlikely too. They're not gonna reinvent anything. Unless Delta does first and they copy.
Jun 5, 2020, 7:11 am
#35
Join Date: Oct 2018
Programs: American Life Time 2 Million Mile Platinum
Posts: 368
Does that make it another risk though since banks are floundering from the economy and as targets of Antifa?
I would really hope that #1 Option would materialize as AA needs something to revitalize their core business with SW and Delta as severe domestic threats coming out of Covid and multiple other carriers as International threats.
All the best.
Jun 5, 2020, 8:55 pm
#37
Join Date: May 2004
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Jun 6, 2020, 2:28 am
#38
Join Date: Mar 2017
Location: British Columbia
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Why on earth would they do that? Nearly all loyalty programs are migrating towards approaches that reward their higher spending and/or more profitable customers, rather than the customers who take the most circuitous routes between point A and B. And I can't think of a single good reason why they shouldn't be.
James
Jun 6, 2020, 5:19 pm
#39
Join Date: Apr 2011
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Posts: 1,426
I anticipate you would also be happy if flights on AA partners earned strickly on the dollars spent too. That way you can't get any EQD AAdvantage on your partner flights. At least then we will really know who the big spenders of OPM are. Once you introduce a revenue component, it is no longer a loyalty program.
James
James
Uhhh, isn’t the point of a loyalty program to reward your best customers? Dollars spent seems like a much better proxy for that than miles flown. Lots of people here spend way more money than me, so it’s not a matter of me being “happy”. It’s just a much more logical way to run a program.
Jun 6, 2020, 5:38 pm
#40
Join Date: Oct 2010
Location: San Diego, Ca
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After baggage fees, the Aadvantage program is the only other asset that actually makes money for AAL. As has been suggested above, most of the recent (customer negative) changes follow the market leader, difficult to see someone new come in and start making significant "enhancements". Different story if AAL ends up selling the program to Citi, a OW partner - or if Blaise-Shamai was in fact forced out, unwilling to implement changes.
Jun 6, 2020, 7:16 pm
#41
Join Date: Mar 2017
Location: British Columbia
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Uhhh, isn’t the point of a loyalty program to reward your best customers? Dollars spent seems like a much better proxy for that than miles flown. Lots of people here spend way more money than me, so it’s not a matter of me being “happy”. It’s just a much more logical way to run a program.
Lots of people probably spend less than you do too. Some will never step on an AA flight yet meet the EQM/EQD requirements without actually spending the equivalent in actual dollars. Are these AA's best customers? I flew JFK-HKG-CPT PE (15,424 miles each way) return in January. Crediting to AA earns 15,424×2×1.5 = 46,272 EQM & 30,848 × 0.2 = $6170 EQD. The fare I paid was $1625.
If you think spend is a better proxy to determine loyalty then the EQD earned in the example should be $1625, not $6170 otherwise this isn't any different than flying a circuitous route on a mileage based system that you have issue with.
In 2019, 61% of AA's revenue was derived from passengers who only flew AA once! Maybe if there wasn't a membership fee, AA could retain more customers willing to fly more than once.
btw, I credited the CX flights to AS and earned enough RDM for a one-way on the same route in F/J.
James
Jun 6, 2020, 7:42 pm
#42
Join Date: May 2004
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Yeah, I signed up for AAdvantage in the 90s using Prodigy, I had the old Three Letters Four Numbers (XXX1111) number but I stopped flying American for awhile and I lost it.
Jun 6, 2020, 8:34 pm
#43
FlyerTalk Evangelist
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It isn't a loyalty program, it is a membership! As a self-funded leisure traveler am I less loyal if I don't spend enough but fly twice as much? Am I less loyal if I fly Y? I earned 125K EQM and flew over 200K miles last year adding in awards. This year, I earned 89K EQM in less than 3 months before the COVID-19 crisis. Just not in AAdvantage because I am not interested in subscribing to their membership and RDM earnings are so poor. I do fly AA periodically, mainly on y-up fares which I can credit to my FF program.
Lots of people probably spend less than you do too. Some will never step on an AA flight yet meet the EQM/EQD requirements without actually spending the equivalent in actual dollars. Are these AA's best customers? I flew JFK-HKG-CPT PE (15,424 miles each way) return in January. Crediting to AA earns 15,424×2×1.5 = 46,272 EQM & 30,848 × 0.2 = $6170 EQD. The fare I paid was $1625.
If you think spend is a better proxy to determine loyalty then the EQD earned in the example should be $1625, not $6170 otherwise this isn't any different than flying a circuitous route on a mileage based system that you have issue with.
In 2019, 61% of AA's revenue was derived from passengers who only flew AA once! Maybe if there wasn't a membership fee, AA could retain more customers willing to fly more than once.
btw, I credited the CX flights to AS and earned enough RDM for a one-way on the same route in F/J.
James
Lots of people probably spend less than you do too. Some will never step on an AA flight yet meet the EQM/EQD requirements without actually spending the equivalent in actual dollars. Are these AA's best customers? I flew JFK-HKG-CPT PE (15,424 miles each way) return in January. Crediting to AA earns 15,424×2×1.5 = 46,272 EQM & 30,848 × 0.2 = $6170 EQD. The fare I paid was $1625.
If you think spend is a better proxy to determine loyalty then the EQD earned in the example should be $1625, not $6170 otherwise this isn't any different than flying a circuitous route on a mileage based system that you have issue with.
In 2019, 61% of AA's revenue was derived from passengers who only flew AA once! Maybe if there wasn't a membership fee, AA could retain more customers willing to fly more than once.
btw, I credited the CX flights to AS and earned enough RDM for a one-way on the same route in F/J.
James
Also, the number of people mileage running on PE fares is quite low in the grand scheme of things. Heck, mileage running in itself is a niche activity - the point of having spend thresholds is to entice the business travelers and frequent flyers to spend more, buy higher fare classes etc.
Loyalty is about how each party benefits, not how much time they spend together. You get the EXP benefits, they get the money. Its as simple as that.
Jun 7, 2020, 7:00 pm
#44
FlyerTalk Evangelist
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Jun 7, 2020, 7:17 pm
#45
Join Date: Mar 2017
Location: British Columbia
Programs: AS MVPG100K, Marriott Marriott Titanium Elite, Hilton Gold
Posts: 7,263
PE is a known sweet spot, the rest of the fares aren't quite as easy.
Also, the number of people mileage running on PE fares is quite low in the grand scheme of things. Heck, mileage running in itself is a niche activity - the point of having spend thresholds is to entice the business travelers and frequent flyers to spend more, buy higher fare classes etc.
Loyalty is about how each party benefits, not how much time they spend together. You get the EXP benefits, they get the money. Its as simple as that.
Also, the number of people mileage running on PE fares is quite low in the grand scheme of things. Heck, mileage running in itself is a niche activity - the point of having spend thresholds is to entice the business travelers and frequent flyers to spend more, buy higher fare classes etc.
Loyalty is about how each party benefits, not how much time they spend together. You get the EXP benefits, they get the money. Its as simple as that.
Completely Wrong! I fly CX regularly to Australia, Singapore & South Africa. I would easily be EXP if I chose to credit to AAdvantage. How does AA benefit when their revenue is Zero? I choose not to because of the membership dues and the poor RDM earnings.
I would get the status, AA gets no money. As simple as that too. Enjoy your membership!
James