Conversation with the President of AAdvantage on Today’s Changes and What Comes Next

I spoke with Suzanne Rubin, the President of AAdvantage, this morning about the changes that have been announced today.

I think she heard the feedback about the lack of notice in the changes to the award chart, rules and opportunities that were announced today, and that while she wouldn’t promise they’d do things differently it’ll be something they think long and hard on in the future.

Here are some key points from our conversation:

  • I emphasized the importance of advance notice of changes to members, as an issue of trust and respect

    Suzanne said made four points, the fourth of which is the most important:

    • They wanted to be out in front of members with their own communication first, rather than having the information come out early, but with some of the changes they had to make advance filings. (This would relate to baggage fee charges.)

    • They felt like they were providing a timing buffer by making changes for tickets effective immediately but only for travel starting June 1.

    • Many of the changes that came out today were seen as “harmonization” rather than transformation changes, and to “get up to speed where the industry already is.”

    • She seemed a bit surprised by the reaction to the lack of notice, “will take the feedback we’re hearing from the community, feedback of the commentary today, into consideration for future decisions. Ultimately we’ll be doing everything we can to steward the AAdvantage program in the way that customers expect.”

  • On the mystery 3rd (high) level of AAnytime awards

    They show just an asterisk for how many miles the top level of awards is going to cost. That bothered me.

    So I asked about pricing and Suzanne told me that it

    remains to be determined, we’re looking at making sure we can appropriately match the award levels with the demand we see on certain days. If you go and think about the prior US Airways Diviend Miles blackout dates, that’s a good first pass at what the days would be, we are actively making sure this isn’t expansive and truly trying to match the demand for the product. Ultimately we need to make sure the value is in line with the revenue opportunity that we have. We’ll have some learning to do on this.

    I’m surprised that the asterisk currently represents that they don’t know.. It can’t be good, of course.

  • Stopovers on Awards

    Suzanne suggested that elimination of stopover was in part driven “from a technical standpoint, while it may not be evident it’s part of making this work together” and also suggested that there was probably too much value relative to pricing (I assume she was referring here to the ‘free one-way’) and that it’s an obscure rule that wasn’t benefiting most members.

  • When can we expect to see more news

    Reciprocal upgrades for elite members should be the next thing announced — US Airways elites getting upgrades on American and vice-versa.

    We have been laser focused on delivering customer benefits of the integration as quickly as possible. We’ve seen the early-on recognition of elite members, entry into oneworld [for US Airways], and notably absent so far is upgrades. We’re working around the clock on upgrades, it’s near and dear to customers, so we’re spending a lot of time, but it’s a complex issue to deliver. It will hopefully be one of next things to announce.

  • On Whether US Airways and American Elite Qualifying Mileage Will Get Combined Towards Status

    This isn’t a topic of the day but something I’ve seen mixed reporting on, and since they don’t actually know for certain when the programs will get combined they haven’t actually made a decision one way or another about how they are going to combine elite qualifying miles from a member’s US Airways and American accounts to determine elite status in the program going forward yet.

    • “Balances in member accounts today cannot be combined to redeem an award on one or the other carrier” (you can’t use some American miles and some US Airways miles towards a single award, and cannot move miles back and forth between the two programs)
    • “We haven’t come out with a date to integrate programs”
    • “When we do integrate, we will be bringing balances together into a single account structure”
    • She then explained that they would probably need to combine elite qualifying balances if the programs were combined during a program year (eg combined in March or September) but not necessarily if there was a clean break into a new program on, say, January 1.

American was too generous with their ‘AAnytime’ awards compared to the rest of the industry. We’ve known that and their actions with new routes suggested that they did too. They were also too generous with baggage allowances for bottom-tier elites, that wasn’t going to last especially with an airline management looking for revenue at every turn.

I’m disappointed to see North American gateway stopovers and oneworld explorer awards go away. Both take real value away from frequent flyers even though they were used only by a very small portion of members.

There will be give and take during the integration, and both AAdvantage and Dividend Miles members will have reasons to be unhappy. US Airways elites up front domestically will at least get fed occasionally now.

I appreciated Suzanne’s time this morning. She’s done good work with AAdvantage to date and clearly wants to going forward, and is somewhat constrained in conversation about their plans.

But the biggest issue in all of this is maintaining trust, being transparent, and giving meaningful notice about changes when possible. That’s the message I offered, and it’s what will set the tone for the rest of the changes to come.


About Gary Leff

Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel a topic he has covered since 2002. Co-founder of frequent flyer community Milepoint.com, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

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  1. Gary, when they eventually change their SAAver award chart, will it be dinAArs or riyAAl? 😉

  2. Save your loyalty folks, both for travel – choose the best cheapest nonstop
    Save your loyalty folks – no AA, go with cash- it is KING all the time and devalues slower than the miles

    it is “Zimb-AA-bway”
    AA is worse than DL for me.

    Luckily I can still have status on DL with a few MQMs and am really happy they are still in DC

    The best may be Jeff $misek after all.
    The UA domestic part is not changed that much and the free upgrades beat AA stickers for a Plat.
    I still get free award changes and decent partners with low YQ

    Shame on AA – it was bad enough that they added YQ on BA suddenly 3 years ago, but at least the rest were OK

    Now it is all a commodity and we are right to focus on price alone

  3. @jay I have varying degrees of trust for different programs. I trust American less than I did.

    There’s no one that gets 100% of my trust.

    At the top and again various gradations but in general I have more trust than distrust (in some cases despite past devaluations) for Hyatt, Starwood, American Express, Chase.

    I have more trust for American than I do United or Delta even after todays changes, but less than I did yesterday because of the lack of notice.

    At the very bottom are programs like Amtrak (even though they’re better than they used to be probablh), they’re almsot down there in my book with the all-time least trustworthy progrmas like GlobalPass.

  4. Not sure what the message is when the head of AAdvantage is “genuinely surprised” that no-advance notice changes would be met this way. What does that say?

    -David

  5. @Nun – I think the answer on explorer awards is that they looked at what each program offers and decided that’s one US Airways doesn’t have, it’s one that very few members actually use (even though many here in the comments do it’s a very small percentage of members), it’s costly to maintain — think of the last time you booked one, did the agent you were talking to even know much about them or how to do them? Had they done more than 1 in the past year? So going down the list and coming up point by point what to keep or change or jettison I think I get why that one gets jettisoned. It sucks. It really does for me, and for those paying close attention to how much value was there. But from a program standpoint, cost versus benefit to members, I think I get why that one winds up on the cutting room floor. I do not like it, but I could live with it **IF** they had given members notice and said “We’re going to be ending the explorer award, so you’ve got the next couple of weeks to get one booked if you want” instead of ending it overnight. That I thought was pretty awful.

  6. I’m confused…it’s for travel starting June 1 but tickets issued today. Meaning if I’m buying today for next week, old things apply or new?

  7. re: top level awards – they’re taking a page from the Uber playbook and implementing quasi-surge pricing.

  8. I feel cheated.

    I had intended on booking a London to Eugene, Oregon trip in September with a free stopover in New York.

    Now they say I can’t.

    The change was made with no advance notice

  9. I believe it’s any bookings made April 8th forward for travel on or after June 1st. If you made a booking prior to April 7th, old rules apply. If you make a booking anytime before June 1st old rules apply. Make a new booking on or after April 8th for travel on or after June 1st and new rules apply.

  10. @ David:

    I believe it’s any bookings made April 8th forward for travel on or after June 1st. If you made a booking prior to April 7th, old rules apply. If you make a booking anytime before June 1st old rules apply. Make a new booking on or after April 8th for travel on or after June 1st and new rules apply.

  11. The best quote of the day is from Marvin –
    Translation: Everyone else decided to screw their customers over and we were still providing marginal value, so we decided to screw our customers over in order to keep up with the industry standard. We’re committed to maintain our position at the cutting edge of customer-screwing.

    Gary loves AA and was very soft on Suzanne. And I bet she knew that when she agreed to the “interview”. She sounded like a politician telling us their latest BS. All the airlines are in a race to bottom for service and customer loyalty and a race to see who can charge the most and give back the least to both occasional and elite customers.

    How is AA going to sell miles at >2 cents and give you back <1 cent. Maybe they will tell us we will make it up on volume. :)

    While I am Lifetime Platinum now, I wonder what that will mean when the harmonization is finished.

  12. Most awards types are used by a small minority of the program customers. If that is a rationale for eliminating awards without notice, the program would gravitate toward having just a 25k level roundtrip domestic US award and do the change effective immediately too. These characters have real audacity in trying to spin things in the way they have.

  13. @Gary – Thanks for the explanation. I would sort of still like to know AA’s stated reason for canceling Explorer. Also a blogger said that other oneworld members offer distance-based awards like Explorer. If true, that makes it strange for AA to permanently drop it.

    Also, there are 2 statements that are a little at odds. On one hand you’re saying Explorer is too much trouble for AA to maintain, but on the other hand no one uses them. Well if hardly anyone uses them, how much trouble can it be? If the online booking tool ever includes all oneworld partners, it may be even less work for their staff.

    Finally, there are some products that can help a business even if the customer never buys it. Explorer is one of them. It’s a dream product for some members. To use a car example, how many people buy the “Limited” version of their car? Probably few, but it makes the car brand look better.

  14. What email address should we send our thoughts about this to at AA? Eliminating Explorer awards folks had saved for for years overnight with no warning really destroyed trust in the program–what’ll go next with no warning?–in addition to being a significant personal disappointment as it ruined my “trip of a lifetime” plans.

  15. As an EXP with 3+million miles, i am absolutely devastated. I am retiring in a few months and have been planning a round-the-world trip for 4 in first. I have NO issues with their devaluation/changes – we knew that was coming – but to do it with no notice is unconscionable. BTW – the online booking tool for Explorer tickets is awesome.

  16. I’ve been saving for years for a RTW trip for my honeymoon this coming winter. 350k miles, now highly devalued to me. Honeymoon plans are now wayyyy different. This will likely push me back to the arms of United, which is just as painful.

  17. @Gary: you obviously personally cared about the explorer award, but there is no mention of it relative to your chat with her. what possible excuse did she have for why it was cut with no warning? the “we’re surprised people care”‘ response is an insult to everyone’s intelligence. i can’t imagine you would let that slide unless you are really toeing the New AA line.

  18. @abby – I’m not letting any answers slide, I’m sharing what she said so that people can judge for themselves (and I think the judgment is clear).

    See my answer above in the comments re the explorer award.

  19. The elimination of stopovers is a disaster, worse for me than UA’s devaluation (since I fly coach). Why is Gary burying and minimising the significance of this huge loss of value? The claim that the changes only impact travel starting June 1 seems to be an outright lie, AA.com won’t let me book a free stopover even for travel later this month.

  20. @Nun – it’s precisely because it’s little used that the training investment doesn’t get amortized across a lot of members, and agents get really rusty doing them.

  21. @GUWonder my guess is they’re getting rid of this in some sense for the same reason Hyatt killed passport escapes award which saddened me greatly because i personally used it.

  22. As these mergers happen we all lose more and more. I understand change is many times necessary and its their program, we can go elsewhere if we like. But to make the changes with no notice is just plain wrong, I spend a lot of time and effort earning miles with US and AA so much for their loyalty to their customers. I just don’t get why you can’t run a successful business focused on customers and be successful, oh, I think you can and that’s probably why all the airlines have gone bankrupt. Maybe if they cared about their customers they would be successful and not nickel and dime us to death. Lousy move on AA’s part.

  23. I suspect Hyatt killed the Passport Escape because the F&B costs were rising and hitting along with the awards disproportionate use during peak periods resulting in Hyatt GP paying closer to the prevailing ADR. A cost reduction exercise independent of “training”/”knowledge” costs. F&B discounts were probably capped.

    These AA changes seem a cost-reduction exercise of the same sort — one that uses minority interest in the reward as an excuse to eliminate value customers get out of the program and reduce program operator’s costs to reimburse the service provider.

  24. I feel bad for Suzanne, since I’m sure none of these were her ideas. She is paid to spin. However, how can she be surprised by the reaction from customers who feel nothing but betrayed?

  25. Did you push her on why we can not transfer miles between AA and US? From your post, it looks like they will wait until the programs are combined. Most other mergers provided this ability early in the process. They are clearly afraid of something since this is a rather simple IT effort.

  26. @Ruy

    “I feel bad for Suzanne, since I’m sure none of these were her ideas. She is paid to spin.”

    Suzanne is the president of AAdvantage. AAdvantage is a marketing group for the airlines, all airlines, not a communications hub. She is not paid to spin, she’s paid to run the AAdvantage program. Because of that, she’s responsible for this change and the timing of same. Full stop. The buck stops with her, and she chose to avoid providing any meaningful answers.

  27. @Andrew I didn’t get the sense that you wouldn’t be able to move points back and forth, just that they didn’t have a date when you’d be able to. I think the IT is proving more challenging than expected on a lot of fronts.

  28. “They gave no notice because they didn’t want to give us a chance to redeem at the old level. But that failure to give some of their best customers notice to be able to use their miles will hurt them in the long run.”

    Right and right. Travel companies need to learn that second part, but managers act as if they will be long gone before the long run consequences bite their companies.

  29. She’s downplaying the whole thing because she’s an executive and that’s her role. Regardless, I take this as an ominous sign for things to come – I’m burning my miles!

  30. Suzanne is a mouthpiece. She is full of it. While this doesn’t affect me right now she is not truthful Just like the email trying to sound like all the changes were great benefits. The truth as nsx stated. The comment from Gary about being a free agent does ring true. But it was Gary’s friend Steve Belkin that did a seminar at FTU called ditch your status. I had some humor to it, and for the most part I agreed. Now even more so. Sizanne is like a lot of people I deal with in business, no guts, and cant handle tough questions. I am sure if Gary grilled her hard she would probably hang up on him. He walks a fine line. If Gary is interviewed on TV or a major publication and brings attention to this American wont invite him to their next party.

  31. The new AA says screw you to me, I’m going to end up saying screw you back. One EXP for the first time in a long time seriously (VERY seriously) now considering leaving for United. I don’t love UA, but in all of their screw-ups, of those that were intentional changes, not even one was done so poorly with such callous disregard for their flying base.

  32. Correction the Steve Belkin seminar was more or less to forget the status and be a free agent. Which I have been the past few yrs. If there is blowback and the airline cards suffer as a result, they wont be so happy.

  33. all the airlines unite in their agenda, that is to continue minimizing FF program, drumming up charges while saying they have improved services etc. like Lucky said we need to let them hear it, regardless of which program aa/ua/as/dl you are in. when there is a devaluation everyone in the game need to unite & let them know, dont just flee to another program or smile that it has not hit me yet, there is no where to run sooner or later they will come knocking.

  34. I like JAL because they don’t make changes to their programs with ZERO advanced notice. #flyoneworld #flyanythingbutAmerican

  35. You have to be really incompetent to screw things up worse than Delta and United combined in just one day, and act like your surprised by it.

  36. We ALL should complain (write and call) to Citi Bank about this American Airlines dishonesty (naming Suzanne Rubin, the President of AAdvantage as the defendant) of issuing credit cards and then no-notice huge changes to the so-called “loyalty” program. Then cancel Citi AA cards. We can’t be just be “sheep” and taking it bending-over.

  37. I feel like it’s a strategic move. They know they’re going to take their lumps during the integration. Maybe they’re doing it this way now so they can spit-shine the next turd that comes along with advance notice and all that and say, “We heard you!”

  38. As someone who was just about to reach 260k miles needed for a AA Explorer SE Asia trip with my GF we had been planning for next January, I feel betrayed. How can anyone call this a “loyalty program” when they strip away benefits without any prior notice, simply inexcusable.

  39. @Kenneth D,

    I agree. The airlines played us for suckers, and they’re getting away with it. As long as business is good/profitable, they can do as they please. One of these days (in the future), they’re going to come crawling back when business is bad. At that point, I’ll remember who screwed me/us over the most before I decide who will get my business.

    As for now, Southwest has been getting my business. In spite of their recent increase in the cost of an award, they seem to have multiple sweetspots; such as free luggage, no change fees, ability to change an award if the mileage goes down, and some ‘low’ priced awards ie 15,000 points R/T LGA/SFO, and LGA/FLL at 8000 points that we booked last year, or anywhere, if you book far enough in advance.

    As someone else said upthread, future booking will be purchased at the best price (Kayaking). 😉

    Rubin looks bad because of her relationship with Gary and Milepoint. Just goes to show you.

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