American Airlines will begin awarding elite status points not just for flying, but also for credit card spend, online shopping, using their dining program, and SimplyMiles.
That’s frustrating for pure flyers who don’t want to use their credit card, giving up more valuable points from Chase, American Express, Citi, et al. Because flying alone takes more spending to requalify under the new system. An Executive Platinum re-earning their status from just flights would need to spend over $18,000 on American Airlines tickets under the new system, up from $15,000 in 2019.
I actually think this would have gone over better if American Airlines hadn’t run out of time working to notify members of the new program. We’re two months from the end of the year, they needed to get word out about how status would be earned. And they’re not done with contracts for partners whose activity will earn Loyalty Points. Basically American Airlines wants to charge more money for a partner’s miles to also count as Loyalty Points, and that’s a process that didn’t finish. We’ll see more ways to earn Loyalty Points before this launches.
But there are really (2) groups that are going to find earning elite status most difficult.
- Non-U.S. customers. While American has credit cards throughout Latin America, they have no cards in Europe and their only Asian card is in Japan. Most of their partners, and certainly Loyalty Points-earning partners, are centered in the U.S.
That leaves program members in much of the world without many opportunities to earn Loyalty Points besides flying. And flight requirements alone have gone up.
- New flyers. The program is going to be easier than ever to re-earn status for those who engage in activities beyond flying. Flying alone is more expensive. But starting from scratch is more expensive still.
That’s because elite bonus points count as Loyalty Points and the highest-status members earn the most points. A new member doesn’t earn any bonus points until they make Gold, earns only Gold bonus points until they make Platinum, etc. A new member earning Executive Platinum status from scratch through ticket spend alone has to spend over $27,000 on American Airlines tickets. That’s the most expensive path in the world to comparable status.
It’s one thing to say that American Airlines doesn’t want a $15,000 a year flyer, who doesn’t also engage in the program in other ways, to have top status – since those other activities are often more profitable to American.
It’s another, I think, to say that whole classes of members are shut off from much of the new program based on their geography. American should consider lower points requirements based on residence.
And it’s another as well to say that new members face a higher hill to climb for status from flying. After all, like every loyalty program they want new members. And with business travel still an open question, they want the loyalty of new business travelers who enter the workforce. Those are the members in particular that may have limited ability to spend on a co-brand card, but they have a lifetime of potential loyalty ahead of them.
Some OPM will also be losers in this. The ones that have to use their corporate card for their expenses while on the road
Gary – in view of that wrinkle wouldn’t you expect American to aggressively roll-out challenge options to get more new Advantage noobs on the teat? They have not been shy with those in the past…
Having different point requirements based on geography is just a bad, complex idea. The idea was to simplify the program, not make it even more complex and gameable. And how many non-US potential members can there be? Not enough to engage in creating a whole new program for them. Does any airline in the world do this?
As for higher initial requirements, this is not unique. I can’t recall the name off the top of my head, but I know that BA has a top tier status that requires more points the first year you get it than to maintain it.
And finally, it’s not impossible for AA to offer potential elite members status challenges that will enable them to reach a certain level through a three month challenge, then easily be able to maintain that level the following year. I’m sure they monitor bookings and CC spending to spot potential candidates. I’ve been offered numerous challenges over the years and finally took them up on an offer for a decent status level when I knew I could complete it based on already planned travel. The key is to reject status offers for low status and/or ones you can’t complete. Once you accept one, new ones are tough to come by for a few years.
@C_M – AA actually says they have and want lots more members specifically in Brazil through local partnerships. The fact that they weren’t exactly considered in the revamp is… interesting.
The new program is “show me the money” and I don’t think “fairness” figures into it. I’m not sure they’d want anyone with less than the threshold spending to get status just because they have a non-US address.
Similarly, $18k of flight spend from a non-elite ought to be treated like $18k of flight spend from an x-splat. I don’t think they’ve thought this part through and I agree with those who foresee offers and challenges for people to get on the status hamster wheel for less spend.
I am so happy to no longer work for an employer that used Concur, and would not reimburse for company travel unless I used the company credit card.
Even though Delta SkyMiles program leaves a lot to be desired, I think I’ll stick with them as it is much simpler to understand and reach status with.
Well, I just completed a fun Transcontinental (MIA LAX MIA on 77W) Flagship AA Dollars ($2,000 & I earned just over this) run to maintain my Platinum staus, but I figure for the last time. We’re retired & I don’t travel as much as I would like. For the last few years I’ve taken the offer to pay cash to maintain Platinum
Hubby doesn’t like to travel and I’ve spoiled him to wanting First Class. Being fortunate to retire ‘comfortably’ we’ll just buy First Class tickets and almost moot the need for status.
For you road warriors, Best Wishes
Gary, something I just realized today that is positively brilliant in the new Loyalty Points is how much it will incentivize credit card spend beyond just qualifying for Executive Platinum status. Let’s say I earn 220,000 Loyalty Points next year and find that I am not upgrading at a high enough rate, the solution is to spend more on the credit card to earn more Loyalty Points and see if I can improve my upgrade position. It might take me 3 years to figure out I can’t spend enough or perhaps just one year if, say I hit 300,000 Loyalty Points and my upgrade percentage increases to a level I find acceptable.
Don’t people with lifetime status get screwed over too since upgrades are now based on loyalty points.
Wise people choose BAEC with 4 BA/IB segments requirement and achieve OWS with two MIA-LAX direct roundtrips plus those 4 required flights. After five-six of those roundtrips plus 4 segments would give OWE(Platinum Pro or EXP). Who would spend tens of thousands just to be EXP and wait does the SWU upgrades are confirmed or not and on the line of intra US free upgrades when flying in coach.
American Airlines has become a Frequent Flyer Terrorist Organization.
@ john – Upgrade priority was also based on 12 month rolling EQD, so lifetimers who don’t fly much now could pretty much only count on free MCE seats.
I hope that an intern who came up with the brilliant Loyalty Point idea will get promoted.
@Gary
1) Does spend on any card attached to my account, business or personal, accrue LP’s?
2) If I achieve status – EXP for for example – through spend, will I have top OW status as a result?
@ JFKPHL — Or how about just buy the cheapest F in the market and forget about upgrades? If you put $200k on an AA card, the opportunity cost is about 2% x $200,000 = $4,000. That buys a lot of upgrades. The airlines are rapidly killing the golden goose by making free agency so worthwhile.
@Christian Emerald status now occurs at Platinum Pro on AA. So far, no one has announced that will change.
What is the comparable status to AA Platinum for the other US based carriers United, Delta, Alaska? And is it easier or more difficult to obtain?
C_M many programs have had different requirements for elite status qualification tied to residence. SAS had at least three different sets of qualification requirements for a period of time, each based on place of residence. Delta still has one set of status requirements for the US and a different set of status requirement for most of the rest of the world.
In this day and age, it’s not a major challenge to have a system in place where qualification requirements vary by region. Computers work, at least when making sure it’s not a situation of garbage in, garbage out and garbage in between.
Most US airlines don’t require as much from non-US flyers to qualify. (In other words, easier to meet status if you live outside the US). Thinking that AA will add shorter hurdles for them.
@AlliW: Please tell me which one of the big three (UA, AA, DL) that does NOT require as much from non-US flyers. I am based in Asia. I’d love to know which one so I can switch to.
I made PlatEX many years back mainly by flying paid F on CX with a few AA flights in between. I still have around 2 million miles which I constantly trying to use for premium international travel (not on AA for obvious reasons). It has been very difficult to get rid of the miles.
For domestic US travel I just buy F on whoever has the best schedule / lowest fare.
I just does not make sense to spend time, money and energy to be loyal. And actually I found most carriers beeing better than AA. And internationally the asian and most european carriers are significantly better than AA.
I feel sorry for all of you who are constantly on the road in the US and experiencing AA.
Being a Road Warrior using Concur and a corporate card for travel, I put all my travel on AA for the last 4 years and have always maintained Platinum Pro. Looks like I may be needing to make a change. My home airport is not a hub for any carrier. So, who will match my status and be the easiest to maintain status with going forward?
To piggyback on a prior commenter . . .
If you buy F or J, what perk is it that you don’t already have that tier status gives you?
– Preferred check-in
– Free checked bags
– Preferred boarding
– Target seat
– Lounge access on long-haul international and trans-continental
Other than award point earn rate, what does tier status give such a person?
There is a whole category of traveler for which tier status is meaningless.
IMO, the “new flyers” thing is overblown on FT and in the blogs.
Average participation in an airline loyalty program is like 20+ years. It’s fairly rare people go from zero to EXP in one year.
You try to get people hooked to the program by throwing them a few bennies with Gold. That happens ideally around the time they are about to leave school or shortly thereafter. As they move up in their work life, they have to oppportunity to fly more and you try to make your program even more essential to them.
Bottom line: I think the vast majority of status level changes are gradual. One step at a time, rarely two steps at a time. The comparison of newbie trying to get to EXP vs. an existing EXP? Again, vastly overblown in its significance!
Whilst acknowledging the inherent differences between the programs the non US flyers being at a disadvantage from not having CC spend they can use is tempered a little when you consider they are in that position now anyway so that’s not changing for them. Also AA is at least to allow status via non flying routes whereas if you take BAEC you can only earn Tier Points ( the points that actually get you the status) from flying alone. There is no path to earn status other than through flying for us and while having the new non flying ability AA are rolling out would be something I think we’d appreciate it also isn’t going to change as BA have no need to do so and they know their customer base accept the system as it is.
As with any airline when these changes are made they are always designed to better benefit the airline and increase their profits it’s simply a game of ‘how far can we push it’ / ‘ehat can we get away with’ that is the main limiting factor.
Of course as a BA flyer I simply deploy the alliance trick and every year or so just after I’ve laid down some flights on CX or AA I simply ask them to status match mento their own program citing “ease of use” as the reason and thus far they’ve always been happy to award me OW Sapphire on their respective programs. Ironically of course of the ball was on the other foot I know that BA would tell me to jump off a cliff as they just don’t do status matching bar a number of major clients
@ Gene – You hit the nail exactly on the head Gene, what is it going to cost me to upgrade 90 percent of the time vs. just buying first class? As a hub captive, I already buy first class for about half my AA flights, so for me, the point at which I can stop doing that is a factor. The truth is, it might take me 3 years of heavy AA credit card spending just to figure it out and that is a windfall for AA and Citi, regardless of if the price is too high and I stop doing it or low enough to make it worth continuing. The CKs are a problem as well, but I fully expect AA to revamp that program next, thinning the ranks.
I disagree completely! If you don’t even live in the US, why would you expect a US carrier to make it easy to earn status? It bugged me for years that UA waived the XYZ thing for foreigners. No special treatment!
As an aside, there are way too many acronyms. The airlines have literally run out of words.
I think AA is currently too busy with its new money making scheme to worry about all the contracts to sell miles to AA partners. They have stumbled on a plan to grossly over-schedule flights that they cannot possibly staff. When they published the schedule people buy millions, if not billions, of dollars in tickets. Then, when the inevitable cancellations have to occur to match over-scheduling with reality, they want you to convert your ticket to a “credit” which can be used later. This amounts to fraud, of course, but results in an interest free loan to American. Plus, your credit expires at the end of 12 months and some precentage of people will forget or be unable to redeem their credits resulting in a complete gift to American.
I fully expect they will soon announce, “make your own flight schedule” where you can pick your own date/time/city pair/aircraft type and (for an extra fee) your specific seat. Then when they cancel that flight the evening before it was “scheduled” to depart they offer you the one-year credit and keep the cash in their bank.
Congress, it is time to mandate change fees be paid by the airlines when they change your schedule (just like you have to pay them if you choose to change it) not to mention a full refund, PLUS a full credit when they cancel in less than 24 hours.