Summary
- The CEO of American Airlines confirms that there will no longer be restrictions on earning miles for flights booked indirectly.
- The change aims to prevent confusion and disruption for customers, prioritizing customer experience.
- The airline is reevaluating its relationships with travel agencies to ensure a smooth transition for end customers.
The CEO of American Airlines has confirmed that the airline will no longer implement a policy restricting the earning of airline miles on flights booked indirectly. The changes were to come into effect later this summer but have since been deemed counterproductive to building customer loyalty, as the updates caused confusion as to which flights earned the full number of miles.
What did he say?
Speaking at the Bernstein Strategic Decisions Conference, American Airlines’ Chief Executive Officer Robert Isom confirmed the airline was experiencing a “softness in close bookings” relative to its expectations. Executives believe this is partly due to changes in its sales and distribution strategy. For the everyday flyer, this most notably involved the airline announcing it would restrict how many AAdvantage miles and loyalty points people earned based on where they booked.
Related
American Airlines Delays AAdvantage Changes – What You Need To Know
The new rules will begin on July 11th.
The change would presumably encourage more passengers to book directly with the airline or “preferred travel partners” at the expense of third-party providers like Expedia and Priceline. Implementing the new rules was delayed until July and appears to have been significantly rethought. Isom confirmed this was due to spending “a lot of time” evaluating the company’s strategy holistically and piece by piece and listening to travel agencies and corporate customers, concluding:
It has always been our priority to treat our customers in their flying in our seats as best as we possibly can.
“For example, next month, we were going to differentiate who earned Aadvantage miles and who didn’t based on where they booked, but we are not doing that because it would create confusion and disruption for our end customer.
Photo: Denver International Airport
Instead, the airline is reevaluating its relationship with travel agencies and corporate markets.
More carrot, less stick
The oneworld alliance carrier concluded the best path forward is to continue ensuring its seats are available to the most customers. It would appear that these customers prefer their flights to be distributed through a large variety of means. Isom confirmed the airline is working more closely with agencies and partners to ensure that the transition is not disruptive to end customers:
“We want to make sure that no customer that’s out there traveling is made worse off from the changes that that we make.”
Part of this includes the airline’s shifted strategies from using “a lot of sticks” to putting more carrots in place to ensure that seats are available wherever customers want to buy them. For instance, instead of removing content from agencies that are relying on legacy technologies, American is now encouraging them to incentivize, enhance, and promote the use of New Distribution Capability (NDC) technology.
Photo: Denver International Airport
The news came shortly after the announcement that the airline’s Chief Commercial Officer, Vasu Raja, would exit the company next month. In his remarks, Isom noted his admiration for Raja’s creative thinking and passion, calling him an innovator, disruptor, and “good friend.”
