Brian Sumers expresses the straw man conventional wisdom,
Travel bloggers love nothing more than amassing millions of frequent flyer miles while buying the cheapest fares.
There’s nothing wrong with that — in fact, my side hobby is leveraging points into impressive redemptions — but the old paradigm never made much sense. Why would a company reward its most frugal customers?
We know now most major airlines have re-jiggered their programs to reward big spenders, and customers who earn points via credit cards.
Let’s leave aside that American obliterated the value of its credit card program by offering far fewer award seats than competitors since being taken over by US Airways management, co-brand credit cards have driven the profitability of frequent flyer programs and to a certain extent airlines, but with devaluation after devaluation those programs are stagnating.
And let’s look at what American Airlines thinks about its loyalty program. It’s something along the lines of what Brian Sumers articluates (and which came right after he sat down with AAdvantage President Bridget Blaise-Shamai).
In written Q&A with employees, who listen to customer complaints about AAdvantage devaluation, here’s how American responds:
The only positive changes for all members I can think of is upgrading on award tickets, something United and Delta already offered.
ConciergeKey members receive better treatment than before, with upgrade list priority over Executive Platinums. ConciergeKey is now the top loyalty program tier.
- Revenue-based mileage-earning doesn’t just redistribute mileage-earning from flights, it awards fewer miles than before. Revenue-based earning means a $300 transatlantic roundtrip earns the same as a $300 Austin – Dallas roundtrip. But miles from flying are only a little over a third of all miles awarded anyway.
- Saver award pricing is more expensive since the March 2016 devaluation. So fewer miles awarded and each mile is worth less.
- With fewer award seats available, members need to book pricier AAnytime awards far more often. As of a year ago the majority of awards were claimed at the AAnytime level.
- AAnytime awards themselves are more expensive, no longer double the saver level but now triple or more.
American believes its ConciergeKey members are better off. They’re better treated, but their miles aren’t worth more. Domestic award tickets are eligible for upgrades for some elites, though upgrades are far tougher to get than ever before. And that’s what’s better.
Meanwhile awards are costlier and harder to get, which is much more relevant to the program’s more than 100 million members — and its co-brand credit card holders who drive 10 figures in revenue. Not to mention how the program obliterated the value of the lifetime elite program.
Nonetheless it’s no doubt accurate that while many members are unhappy with AAdvantage changes, they’ve heard from a nonzero number “who are quite happy.”
Contra Brian Sumers, I don’t think that there’s an inalienable right to ‘millions of miles on the cheapest fares.’ What I do think is that as a business traveler who has no problem meeting minimum spend requirements for Executive Platinum status even while now spreading my business across other airlines that devaluation has meant I no longer pay extra to fly American Airlines, or go out of my way with connections to stay on the carrier rather than taking a non-stop on someone else.