The Good and Bad of Changes to American AAdvantage

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.

However it’s flat out not true that AAdvantage rewards high spenders more than it did two years ago and four years ago.

  • 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.

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 InsideFlyer.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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Comments

  1. I am sick and tired of hiring people trash Aadvantage. That’s my job

    Parker is a very stable genius

  2. At this point, I think there will only be positive change if credit card spending on their co-branded credit cards drop. That is one of their largest revenue generators. There has to be a spot where the general aadvantage credit card holders determines that the inability to redeem at saver levels makes collecting aadvantage miles less worthwhile. I wonder when or if that point will ever be reached.

  3. I agree that on most fares the mileage earning is certainly not better than it was before. However, my recent $9,000 business class ticket from ORD to Lisbon via LHR earned a TON more miles than under the old program. Maybe this is what they’re basing their logic on.

  4. Went to book an AA flight recently.

    Citibank AA credit card offer during booking process was thus:

    40,000 mile sign-up bonus for $3k spend within 3 months
    $200 statement credit (usable immediately – on that booking)
    $95 annual fee, waived for first year.

    I passed, but I might have bit at above if it was 60K miles.
    Already sitting on a pile of AA miles.

  5. How about as many as possible Citibank AA credit card holders stop using their AA credit cards for one full (dates would be announced ahead of time) week. Wouldn’t that send a strong message for both Citi and AA about the program?

  6. When my Aviator Red card came up for renewal 2 months ago I called to cancel it. The rep asked what it would take for me to keep the card and I said I do not want anymore AA miles as I can’t use the 3/4 million miles I already have. “They are almost worthless- can’t even give them away.” The rep asked don’t I get value from the free checked bags benefit? I said there are no free checked bags for international flights to Mexico etc and all Europe availability is on BA with fuel surcharges that are higher than some cash coach fares. I fly SWA for domestic where they don’t charge for bags. The rep asked if I would keep the card another year for no fee and no spending requirement just in case availability and policies improve.
    I still have the card but have only used it as an ice scraper!
    Crooks- must be graduates of Trump U

  7. With award prices no longer remotely a bargain and availability laughable on AA metal for premium cabins on remotely desirable flights, the only moderate value I can find with American is partner awards to Asia. When those become unavailable or even more pricey, I’ll completely give up on Aadvantage.

  8. Do you have a comment/comparison on AAdvantage versus Delta/United? I know you are a DFW based flyer so your frustration comes through, but surely they have all devalued??

  9. Typical corporate leadership garbage talk. They are shameless charlatans twisting bad things to make it a positive. They have no problem looking people straight in the eye while simultaneously stabbing them in the back. Sadly this is very common in the corporate world, AA is just one example of this.

  10. I just don’t get where all the “no Milesaaver availability” comes from. It must depend on where you want to go and when. From September 2017 to September 2018 I will have made 3 trips to Hawaii, and a trip from Singapore to Hong Kong to Tokyo to Dallas with Milesaaver Awards. Had no trouble whatsoever finding Business/First Milesaaver seats for the Singapore to Dallas trip. Sin – HKG is on CX. The rest of the flights were / are on AA. And, right now there is all kinds of Milesaaver dates to Hawaii through the end of September at least.

  11. Missed my AA status by 300 “miles” last year and mad no attempt to keep it.
    Transferred my status to Alaska in Oct
    Laughed at the $395 offer to buy my status back
    Use my card now for exactly nothing – deciding when to cancel it but i still have family in dallas and 250K miles so might hang onto it for a year as i find a way to burn the miles

  12. For the 95% of AAdvantage members who don’t have a barrowload of the ‘right’ credit cards, and don’t give a f*** about this or that elite status you narrowly focus on, the AAdvantage program, for redeeming bulk-purchased miles, has gone to hell. There are much better programs out there now, and that’s where I do my flight shopping.

  13. @Paul

    You had me on your side of thinking until your idiotic and non sequitur final line.

  14. A loyalty program that’s pushing customers away. Imagine that.
    I’ve also cancelled all of my AA cobrand cards recently.
    AA is terrible.

  15. WilliamC – will save u some time

    Trump / Crooks U

    Now – This post is one reason why I read Gary Leff. He is the best. Analysis of effectively a CFO who is a sympathetic flyer.

    It has to be a two-tier approach. Reward total spend for J customers, reward frequency for Y customers – but no. In effect AA has given wanting to entice most coach flyers.

    I’m lifetime gold and I’ve spent more time on DL/WN/B6 and even F9 in the last two years than ever before. I am merely a bubble in the level. AA is not getting it right.

  16. Oh and Gary this LAX flyer just dropped my Citi® / AAdvantage® Executive World Elite™ Mastercard® outright. Just not worth it.

    Rather go to the Saxon Pub.

  17. Unless your company allows you to buy walk up or business class fares there is no reason to be loyal. I can get more miles per dollar buying stuff online than I can flying. And I’m not loyal where I buy things online so why should I be for flights I purchase.

  18. AA award availability is still so stupidly bad. On Sunday, there were no saver coach award seats available for a Wednesday MSY-DCA nonstop. I still flew AA that morning, and the flight was barely half full, without a single middle seat occupied.

    That’s just dumb.

  19. Availability of low level Saver awards has improved in some cases in the past few months after being absolutely awful. I can currently get out of my home airport on an award ticket the majority of days, while a year ago it would have usually been necessary to drive to Dallas or pay for a positioning flight.

    I have no reason whatsoever to trust them, though.

    This guy says that for any “big” change, “We’ll give our customers and our team members a heads up well in advance.” Since I was one who had been accumulating AAdvantage miles for years and had finally reached the threshold for an around the world business class seat on the Explorer Award, when they canceled it with zero notice (this blog’s reaction to which was the low point in its history in my opinion), I don’t trust anything that comes out of their mouths. Maybe that’s policy today, until they change the policy tomorrow.

  20. “We’ll give our customers and team members a heads up well in advance” Baaaaaahhhh.
    I like AA and have been loyal to AA but we all have our limits. All this info from them is corporate double speak. Since they seem to like that I will use and example…”AA is like a burning platform where the customers are running for the lifeboats with the women and children” 🙂

  21. For anyone who is easily offended: Trump / Crooks U

    I live in Phoenix, I plan on moving back to Chicago at some point. AA makes a lot of sense for those reasons. I love to travel internationally for vacation even if I have to pay for trips, oneworld status does have its benefits.

    If one wanted to switch loyalty I don’t know who I would switch to? I was thinking of UA a year back but with Kirby there now probably a bad idea. I want a decent lounge network too. Based on living in Phoenix I don’t see any viable options?

  22. I’m moving to UA, for better or worse, and somewhat of a challenge being based in Dallas. Had a horrific experience with AA that caused a missed TATL flight in Dec. I finally just gave up on AA, even as ExPlat 3MM’er (almost 4 Mil now).

  23. @paul and @steve

    You have to realize that Trump U grads would have allowed you to earn miles from the era before the changes. It was under Obama that allowed excessive consolidation of airlines and the devaluation of FF programs for a socialism disorder. Wing it because you fly less now gents, thanks to Barack Insane Obama, your boy, your Messiah.

  24. Platinum for life… Worthless. 750K Miles…. Worthless.
    Have made a point to avoid American from now on… And I live in DFW.
    SAAver awards available between DFW and LA via…. ORD? Seriously?
    The new management truly do not care.
    Employees, especially “Legacy,” are demoralized, putting on a brave face.

  25. So much angst. In almost 30 years flying AA I have never had a problem big enough to clearly recall the details. I frequently get fees waived even though the rules provide for them. Honestly, try being NICE it’s quite amazing the discretion available at the front line and one up. Yes PlanAAhead on my preferred routes are proving difficult the last 18 months or so. I also don’t use my co-branded Citi card as much anymore and last two years I have twice flown Star Alliance partners internationally.

  26. I can understand wanting to use the least amount of miles, and in many markets there are awards that are lower than the mile saver type awards. There are also credit card specials for lower miles in coach and first.
    Now, as far as, premium cabins not being available there is a very simple and good reason for that. Many years ago legacy carriers NEVER offered the wide price range of fares for ANY forward cabin. For example: Fares from a US gateway to a European city in business class started around 10K round trip. Then airlines began experimenting with a 50 day advance purchase that sliced that in half. The latter being non refundable/only reusable, and the penalties steep. Those fares sold well as the economy recovered. Building on that even lower fares we’re introduced. As a sales person I can tell you I can sell those all day. This depletes an already smaller cabin. The last handful of seats are sold at full fare, or in AA’s case are available for a product known as Aairpass. Aairpass clients prepay for travel at an pre established amount per mile depending on the cabin. These are business clients who need to book at the last minute. Therefore, it’s important to have a premium cabin available. Back in the day the people who paid for business and first essentially paid for all of us in coach. Airlines are a business. I never have understood the public acting like it’s a crime for airlines to make money. In the beginning airlines didn’t even charge penalties to adjust your ticket, however, as common courtesy evaporated about just not showing up for your flight airlines having no way to resell that seat airlines had to find a way to recover those losses. My final comment has to do with with just how much airlines pay in to use the airports. Private Jets the 1% enjoy do so at ALL of our expense. Airlines and their employees frequently solicit Congress along with lobbyists to try to get other private planes to pay their fair share. If you take a 50′ yacht alone through the locks in the Panama Canal it costs thousands….as it should….. If, however, you are willing to go through the locks WITH a freighter the cost is just hundreds. Just remember when you fly from JFK to LAX for around 400.00 in about five hours the bus or driving puts things in perspective, right?

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