Yesterday’s announcement about the 2015 AAdvantage program was met with a big sigh of relief by a lot of American frequent flyers, including this one. There had been a limited amount of speculation that American would announce a revenue based program like Delta and United have done. An email I received last night piqued my interest.
Subject Line: Shot Across the Bow
Content: Do you think AA keeping FFP in tact will cause Delta and United to have second thoughts?
MJ’s Answer
No, I don’t. First, whether you agree with revenue-based programs or not, switching to them is not a small feat. A lot of work has been going on behind the scenes to prepare for the change. On January 1, 2015, Delta is going revenue-based no matter what happens with AAdvantage, and United will follow in March. Second, in my opinion the biggest reason that the new AAdvantage looks so similar to the old AAdvantage is that is what AA’s IT systems will allow for now. AA is focused on integrating the two airlines and their loyalty programs, and that is the correct priority in my book.
Now, the benefit of going last in the round of mergers is that you have the advantage of seeing those that go before you screw up or get things right. My thoughts on the inevitability of revenue-based programs are widely known, and made fun of by nearly every blogger on earth. You know where I stand on that. But hey, if I’m wrong, and the programs flop…..AA will have the benefit of time to watch the others fail and measure the amount of business it gains by being different. In the near term, at least, I don’t see AA’s announcement having any impact on what Delta and United are planning for next year. Anyone feel differently? Share your thoughts.
-MJ, October 29, 2014
@rene – Except they’re not driving people away, and their profits aren’t falling.
Good comments here. I’m sorry I’m out of pocket today, and just now getting around to looking.
@C, I expect you will likely be fine for your 8/2016 trip.
Overall, I don’t think anyone knows what will happen next year. I tend to think Delta’s plans are going to work for Delta. United? We will see. Maybe AA charts its own path.
@Keith – no, but such a “smart” company should not have to drive people away and see profits fall before they get it. IMO that is what will happen. We will see. Maybe MJ is right! 😉
Is that wrong of Delta?
Delta wants to make more money (always). If Skymiles in whatever form it is costs them in the long run – they change. It is that simple.
Yes, one would think being the third merger would be beneficial but being the second didn’t seem to help United.
I just hope things stay more or less the same long enough for me to book a long-planned-for award in September 2015 for August 2016. Well, not really; it’s not all about me. I want the program to stay non-rev based, because a rev-based program wouldn’t work well for a lot of us. But I am biting my nails about this August 2016 trip.
Great blog. Thank you.