Last month I wrote a letter to the editor of Inside Flyer arguing that it was unreasonable for Award Wallet not to be able to track American AAdvantage account balances.
Randy Petersen had defended American’s decision in the August issue of the magazine, arguing that American’s position was consistent with their terms and conditions, they weren’t the first to do it (Southwest was), and it’s a reasonable move to protect member data.
I suggested that blocking Award Wallet from helping members manage their American AAdvantage frequent flyer balances was an unreasonable move because:
- Award Wallet wasn’t even storing member account data at all. They didn’t see American account numbers or passwords or mileage balances. Their browser plugin, which members downloaded, kept all that information on their own computers only.
- It reduces security when members aren’t watching their account balances closely. Award Wallet lets them easily see with a single click changes in their balances. Members check in every day and notice changes both big and small. As opposed to checking in less frequently on an individual program website, which displays current balance but doesn’t currently flag changes in that balance. You get better security by having more vigilant members who are likely to quickly notice anomalies. That’s the sort of system that’s robust and responds well to problems.
- It’s short-sighted, Award Wallet makes it easier for members to stay engaged in programs. And that means they do more business with those programs, credit more miles. Making it harder for members to access their data creates barriers between a program and its members.
Randy published my letter, and used the opening remarks of his September issue of the magazine to respond.
He and I disagree, but I thought it respectful — especially because he published my thoughts — to share his in return.
You mention trying to persuade me to “join the call” to let members manage their own data. What I find strange about this comment is that I’m pretty sure history shows I was the absolute first to make that call and still do. In fact, you likely weren’t even in high school when I first introduced a solution to help members manage their miles and data. What exactly were you doing in 1987? Fact is, I’m all for members being able to manage their own data or I would have never introduced the original Mileage Manager in 1987. And while I’m not big on this recent move by both Southwest and American, I do respect where they are coming from. I can assure you that in the original conversations I had with Southwest about their stance on this, the idea of a commercial agreement was not the topic of concern they spoke of–it was their members’ information security. Reading Ms. Rubin’s comments from the recent Milepoint chat, I can see that AA might be sensitive to a third party company having the ability to “profit” from their data. There it is, that ugly capitalist word–profit.
Now, concerning commercial agreements–to get access to any travel industry information and/or inventory, you must have a commercial agreement in place to utilize that data. Individual customer data is not freely available–companies must pay for it.
Granted, the amount of money required to get access to this member data may in many cases be a high hurdle to clear for the smaller startups, but frankly I see that as a positive. Here’s why. Over the past 20 years, I’ve seen more than 50 screen scrapers come and go with business models to help aggregate mileage and other types of loyalty balances with maybe two or three identified as “making it”. Gary, you are a CFO, what kind of business market is that? With the move toward commercial agreements, it likely will force this segment to become more accountable to their business model, and as well, more responsible to their customers. And I’m not saying I agree that this is the best solution, but if it brings some level of responsibility and protection for the members and their data, then I’m all for it.
I’m sure the reasons why AAdvantage has suggested a commercial agreement are complex, but the main reason is that they likely have spent a lot of time and money creating the membership data and why should they give it away? I know the reply … because it’s their customers’ data, not AAdvantage’s. I get that, but I think by and large that average members need some level of protection for what happens to that data if released by a loyalty program.
Here’s a really funny look at this situation, Gary, because you mention the issue of “terms and conditions to the detriment of their members” and, “members have to take extra steps to check their frequent flyer balances.” I visited two of the leading mileage aggregators today and here are excerpts from these third party companies’ own terms and conditions: “Your Membership is solely for your personal use, and you agree not to authorize others to use your Membership account …” and “While XXXX may show award expiration dates it is the user’s responsibility to verify expiration dates directly with the provider of miles/points”. I find it ironic that the very industry you are defending has the very same rules as the industry it does not want to honor. And to verify the information on a third party website, you are being asked to return to where that information came from.
Historically, all loyalty programs have been accused of jealously guarding their members’ data. But the suggestion from AAdvantage of a commercial agreement might mean that the program is working to become a gateway–becoming a more open model for those who wish to work with AAdvantage. Without realizing it, we may be witnessing the next phase of the customer–apps for everyone.
Gary (and all frequent flyers)–we are all on the same call, let’s respect their rules and concerns and work toward making it safe and responsible for all of us.
I do think Randy has credibility on this, he’s managed miles for large numbers of frequent flyers and helped them organize their account information and balances. And he clearly believes that the programs are on reasonable ground in taking steps to limit third-party website access to their members’ data.
I would simply again respond though that:
- Award Wallet stopped accessing American’s member data entirely. It was only the members’ own web browsers that ever held account numbers or balances or pinged the American Airlines servers. Randy doesn’t address this.
- Helping members to notice changes – both large and small – closer to real time is a huge boost to security. Members are much more likely to notice a breach of their information if they track their balances on Award Wallet than if they have to log in separately to an individual program website, and do so perhaps once a week or once a month or even less frequently. Randy doesn’t address this, either.
- While American may have the legal right to do what it’s doing, I am arguing that it is misguided – against its own long-term interest in generating member engagement.
Of course Award Wallet and other websites have terms and conditions, they don’t want to get sued — especially over things outside of their control like mileage expiration. Programs frequently behave in ways that run counter to their published procedures. If Award Wallet says miles expire in 18 months because that’s a program’s rules, and the program doesn’t actually expire miles in inactive accounts (hotel programs usually don’t adhere strictly to their rules in this area), someone might argue that they incurred unnecessary expense to keep their miles active and that that’s Award Wallet’s fault.
But just because we live in a litigious society doesn’t mean we have to be litigious ourselves. And a program’s terms and conditions aren’t a suicide pact, either, that must be enforced in the extreme. Award Wallet now does its best to police members who might add a ‘custom program’ where they enter the program name, account number, and balance themselves. They report being warned by American’s lawyers that they’d better not have any account numbers that even look like AAdvantage numbers in their system.
So while Randy and I agree on a great many things, we do disagree on this. But I’m genuinely honored he took the time to respond in-depth to my concerns and in such a significant way.