American Airlines is trying to reverse course, having intentionally walked away from doing business with many travel agencies and corporate accounts. For instance,
- They laid off much of their sales team and also customer service that helped with these accounts
- They threatened to stop letting travel agency tickets earn frequent flyer miles unless those agencies went through lower-cost “NDC” channels that help sell not just airline tickets but also add-ons like paid seat assignments.
The airline has let go of the major proponent of this strategy Vasu Raja, who argued that American didn’t need to offer discounts to fill their planes and that for many customers they’d sell the seats anywhere (at a higher price, and at lower distribution cost).
Now they’re trying to win this business back, even offering a ‘limited time’ promotion of 10% commissions on premium products to travel agencies.
One of the changes when American began dropping business travel as a core customer segment was the elimination of the AAirpass program, where customers pre-purchased a certain amount of travel from the airline and gained certain benefits for doing so.
Buy enough travel and they used to even give you elusive ConciergeKey status. Customers who bought or renewed their AAirpass membership, which targeted businesses, right before the program’s end 19 months ago are just now seeing that status expire.
ConciergeKey is the status that American Airlines gives to its top spending customers and top corporate travel influencers. It’s the status that George Clooney had in Up In The Air. I had the status briefly and the best thing about it wasn’t:
- top priority for upgrades
- being met with golf carts and driven to American’s international business class lounges on domestic flights
- being driven across the tarmac if you had an especially tight connection.
The best thing was getting confirmed on sold out flights when a flight is severely delayed or cancelled – American being willing to bump another passenger to get you where you’re going.
Other customers who didn’t get renewed for ConciergeKey have been getting status buy back offers. Just like American has regularly offered other elite frequent flyers who didn’t requalify the ability to buy back their status (an Executive Platinum member might be asked to pay $2,300, for instance), Concierge Key members were given paid offers as well.
- Most were asked to pay a whopping $10,000
- Some were asked to pay ‘only’ $5,000
American is now rolling out buy back offers to AAirpass members. As with the other ConciergeKey buy backs, the offer is made by phone (with follow up email) rather than as an e-mail with online enrollment.
Of course, those with Lifetime AAirpasses, which were sold between 1981 and 1993, were unaffected by the sunset of AAirpass sales. Those who purchased a lifetime AAirpass – like Mark Cuban and Michael Dell – got to keep them. (Passes like Steve Rothstein’s don’t get reinstated, however.) Those members did not receive ConciergeKey with their purchase.
While American Airlines will no longer bundle ConciergeKey status with prepaid travel accounts, and won’t even sell those accounts, United still has their PassPlus program, and it allows the purchase of Global Services status. But American Airlines is looking for revenue anywhere they can find it.
To this day, I regret not buying a first class lifetime AAirpass for $250k. I wonder whether Steve Garvey still has his.
I would be much more impressed if they brought back the AAirPass program in some form, even at a higher cost. I cannot think of a more devastating loss to many heavy business travelers than the sunsetting of the program (without notice) back in November, 2022. While I’m happy that lapsed CKs may be able to buy their status back, if AA is serious about boosting revenue and paying attention to business customers, they’ll bring back this program for the thousands of business travelers who miss it.
The cost of buying back status from AA always greatly exceeds any benefits perceived or otherwise.
It’s difficult to believe that American walked away from AAirpass and tens of millions (or more) of prepaid corporate travel dollars; was a tremendous value that CK status offered and they need to bring it back, as many are willing to pay a premium for guaranteed space on confirmed domestic and transatlantic business class (Y-UP) at the time of booking, especially during IROPS. No standby list for upgrades and getting automatically booked to the very next flight, regardless if overbooked.
What were they (Raja and Isom) thinking…
Is Vasa Raja related to Rishi Sunak by any chance? The reason I ask is they both know how to “Jack up” operations of large organizations.
American cares about your credit card.. they don’t give a damn about how many miles you fly on the airlines.. you’re just another weed in the garden on their planes…
Frequent flyer benefits are a thing of the past… You can fly Coast to Coast 10 times and not gain even 10% towards Gold status. THEY ONLY CARE ABOUT YOUR CREDIT CARD THEY DON’T CARE ABOUT YOU.
@Mets Fan — Yep, they offered me to buy back up to Executive Platinum, after I let it slide to Platinum Pro due to degradation of benefits, for $2300. They must’ve pitched the offer 12-15 times between email and the mobile app. They’re out of their minds if they think it’s worth that much, plus upgrades would still be tied to loyalty points anyway, so just buying the status wouldn’t even matter in that regard. Offer something that’s actually good, American – i.e. a high quality travel experience and meaningful benefits for loyalty – and maybe I’ll reconsider in future years.
Interesting analysis of American Airlines’ shifting strategy, Gary. It’s fascinating to see how they’re trying to backtrack after alienating so many travel agencies and corporate accounts. The 10% commission offer seems like a desperate move to regain lost business.
The AAirpass program’s elimination was a big deal, and it’s telling that they’re now reaching out to former members with ConciergeKey offers. It really highlights how much AA is scrambling to reconnect with high-value customers they previously took for granted.
Your brief experience with ConciergeKey status sounds intriguing. I’m curious – what did you find to be the most valuable aspect of the status, if not the upgrades and special services you mentioned?
This whole situation serves as a cautionary tale about the dangers of abruptly changing long-standing business models and relationships in the airline industry. It’ll be interesting to see if these efforts to win back business travelers and agencies are successful, or if the damage is already done.
Thanks for keeping us updated on these industry shifts. Your insights are always valuable for understanding the bigger picture in air travel.
After having been a CK for a number of years, I’ve moved all but three or four flights per year away from AA. Won’t bore anyone with griping but will simply leave it at that AA changed.
I might pay $5k for CK. Not $10k.
The other reason not mentioned – your airline is so understaffed it will take you 90 minutes just to check your bags – if you’re lucky. I missed my flight on New Years Eve because United was so understaffed. Even those with bag drop express were impacted since a human has to see your ID – I cannot wait for this step to be automated in more places. It would eliminate a major bottle neck in many airports.