Rolfe Shellenberger, who with a couple of other executives under American’s Senior Vice President of Sales and Marketing Tom Plaskett (once considered a possible successor to Bob Crandall) worked with consultant Hal Brierley to launch American AAdvantage as the first mileage-based frequent flyer program in 1981. I’m told that Schellenberger, whom I was privileged to communicate with later in his life, passed away.
The project’s code name in development was ‘Loyalty Fare’ because the original task was to come up with a frequent traveler discount – but they determined this would be quickly matched by competitors and reduce revenue, and they wanted to grow revenue so that passengers would choose American even when fares were higher or flights less convenient.
Western Airlines Travel Pass was arguably the first modern loyalty program, offering $50 off for every 5 trips. And of course Steve Grosvald launched Mileage Plus days after American AAdvantage took United Airlines by surprise. But AAdvantage was first to market with what we think of as a frequent flyer program today.
The original AAdvantage charged 12,000 miles for a first class upgrade (there were no capacity controls). 50,000 miles was a first class roundtrip ticket, and if you bought a coach ticket for a companion it came with an upgrade, too. Two first class tickets were 75,000 miles. When AAdvantage launched they started out with existing customer lists totaling around 200,000 members.
While AAdvantage was a team effort under Plaskett, Shellenberger took specific credit for bringing upgrades to the program in an interview with Randy Petersen,
I insisted on upgrades on being a part of the program and being maintained. The upgrade was a key factor in the success of the program. Because it was a cheap way to keep the guy locked in. A little more than two roundtrips coast to coast would get you in there.
…It’s the thing that got people early on eager to get more. It was like feeding a bunch of pigs in a trough. The upgrades really made a lot of sense as they made people feel that the airline was doing something for them.
A year later British Airways awards were added: 20,000 miles for an upgrade from first class to Concorde or 40,000 miles for an economy roundtrip between the U.S. and London for two passengers. Elite status – AAdvantage Gold – was introduced in July 1982.
American’s first hotel partner was Hyatt, so the new American-Hyatt partnership is fitting. Back in the fall of 1982 members received discounts on Hyatt properties in Mexico, “Imagine a double room at the Hyatt Cancun Caribe for only $37.50 or a double room at the Hyatt Regency Acapulco for only $30.50.” Around the same time Hertz became the fist car rental partner. Shellenberger was responsible for both.
Many forget that Shellenberger’s AAdvantage was introduced as a promotion, and wasn’t made indefinite until April 1983 two years into its life. It wasn’t obvious at the start how big this would become.
He wasn’t just known for the frequent flyer program, but also takes credit for putting pianos on Boeing 747s.
Shellenberger was 91.
The first frequent flyer program was created by Texas International Airlines (which later merged with Continental) in 1979. United began a frequent flyer recognition program in the early 1970s.
Was lucky enough to fly the Concorde on miles in the late 80s. You got a economy connection from LAX to JFK, took the Concorde to LHR and back to Washington DC and then coach again back home. They gave you a flask, pen, and a few other things most of which I still have! Those were the days!
I actually still have my AAdvantage Card I got back in the early 80’s. Still carry it so I can remember my number (look like it was done on a typewriter)! I was just a college kid in those days but thought it would be cool to earn free travel if I could. I have earned a lot of free travel with AA; TWA; NWA/DL over the years. Saving those miles up for business class to Australia when life gets back to normal.
Prayers go out to his family.
I signed up the first week at O’Hare just before boarding an AA flight. My AAdvantage account number was and still is very low all numbers.
@Dom – I can talk about why those programs are different but United began recognizing frequent flyers long before the 70s
I remember joining AAdvantage as a prerequisite to using EaasySabre on Compuserve back in the day. That would have been ~1983. That hooked me into programs from other airlines.
It was a big improvement over earlier “reward” programs like S&H green stamps and such.
The concept changed not only the airline/travel industry but other industries, too. Now everyone and their brother has a loyalty program of some kind.
Just before the COVID-19 slow down of travel an AA counter person asked for my AAdvantage card because “there was a problem” I handed over the card (why I still carry it is another story) and she said “this can’t be right, there are no letters in your number. ” I said look at my gray hair and that will answer your question. She had never seen an all number AAdvantage account. Must have been new to the role.
Don’t forget the role Max Hopper had in both Aadvantage and Sabre
Virtually, everyone that worked in the Marketing area for American at the Headquarters in NY and Dallas knew “Shelly.” He was a very personable and unassuming figure. So much so that, until now, I did not realize his major role in the creation of the AAdvanage program until reading this article..
As noted by “AC,” Max Hopper was a giant in the development of SABRE and, especially the opening up of the massive power of automation. He was truly the “Father of Travel Agency Automation” and putting American Airlines at the forefront of unleashing the, as yet, untapped potential and capability of the airline CRS ‘s.
The first flight I ever remember flying was in 1973. I was so excited that I couldn’t sleep. The stewardess (as they were called at the time) offered me a tour of the plane if I liked. I nearly leapt out of my seat at the chance. It was impressive, but what amazed me the most was a piano in the upstairs (upstairs on a plane!) area where passengers were lounging about. I got to meet the pilots as well. Truly an amazing experience for a six year old kid and I’ve had a thing for both Pan Am and the 747 ever since. Maybe Pan Am emulated American on the piano front, but if so it would’ve had to have been awful quick on the followup.
@Leff “I can talk about why those programs are different”
Of course the United program was different. It was a recognition program, as I indicated, and until the 70s, it was internal. In 1972, it became a public program and anyone could join.
I would welcome your explanation of why you don’t consider the TIA program to be a FF scheme.
Wikipedia: “The first modern frequent flyer program was created at Texas International Airlines in 1979.”
The Points Guy: “Texas International Airlines is largely credited with creating the first mileage-based frequent-flyer program back in 1979.”
Sell My Miles: “In 1979, the frequent-flyer program really got going when Texas International Airlines started to track mileage as opposed to the number of tickets purchased.”
the Luxury Travel Expert: “[AAdvantage] was the second such loyalty program in the world (after the first at Texas International Airlines in 1979).”
Just found your site while googling other issues regarding FFPs. I enjoyed a 21 year career with United and my last, of many positions at United, was Manager of Merchandising and Promotion which included all the frequent flyer activities, including the launch of MileagePlus. Here’s some additional information regarding United: Their first program was the “100,000 Mile Club” plaque on the wall recognition program. That was followed by the very popular Executive Air Travel Program (EATP) directed by my predecessor, Frank Kent, which lured even more frequent flyers…but no flight awards during the regulated period of the industry. It was the deregulation of the US airline industry that permitted granting awards of greater than $50 in value. As stated on the foregoing comments, AA was the first to launch a “free flight” award program with AAdvantage.
Our understanding was AA felt they would have a several month lead time on the industry. I was thinking 2 -3 weeks for us to launch. Our then VP Sales, John Blackman said, “I think you have 7 – 10 days max.” Whew. We put MileagePlus together, announced it in 48 hours and launched in 10 days….automatically enrolling all EATP and Red Carpet Club members. Lots more involved but that’s the short version. Several years later I was Staff VP of Marketing Programs at Continental. Working closely with our counterparts at Eastern Airlines which had been acquired by Frank Lorenzo. We jointly developed and launched OnePass. Mike Ribero was my counterpart at Eastern and a terrific guy. OnePass was the first FFP to offer a two tier award system for “anytime” as well as lower “cost” capacity controlled award seats. With OnePass we were also the first to launch FFP linked credit cards….with Marine Midland Bank Gold MasterCards. The industry quickly followed those two features.
Great times to work in the industry.