American and Alaska Are Giving Away Elite Status — Business of Loyalty

After the first full year in which revenue-based loyalty programs have dominated the U.S. airline industry, the consensus is still out on whether mainstream travelers have entirely given up on frequent flyer miles. One indication, however, may suggest that airlines are willing to cede some ground to passengers: Promotions expediting elite status are starting to seep out.

Both Alaska Airlines and American Airlines have recently been targeting customers to offer a fast track for free elite status.

American’s campaign started in September but has recently scaled up to include direct mail sent to customers’ homes or offices. The campaign offers a range of complimentary Gold, Platinum or Platinum Pro statuses (earned at 25,000 flown miles + $3,000 in annual spend, 50,000 flown miles + $6,000 in annual spend or 75,000 flown miles + $9,000 spend, respectively) — including upgrades — to targeted members.

Most invitations for free status from American have come through email, though some targets are getting physical mailers. According to the blog Angelina Travels, anyone can try to sign up for the free status through a promotional landing page but only a certain segment of accounts have been targeted.

Launched last week, Alaska’s offering is slightly more modest. To some targeted members who let elite status lapse in 2017, the airline is offering a fast track back to the same status after a fixed set of flights. Scott Mackenzie, a writer at Travel Codex, was offered MVP Gold (typically earned after 40,000 flown miles) after only flying a 10,000-mile challenge. Others have reported receiving similar offers.

Though Alaska and American may both be trying to woo back frequent flyers, they may be doing it for different reasons.

Now that American’s revenue-based loyalty program is fully in place, it’s likely that the airline saw some attrition within the ranks of AAdvantage. Beyond that the airline has recently been suffering from a glut of bad press over its product. Many frequent travelers have complained about slowly degrading service and catering (further compounded by a listeria outbreak at the airline’s catering contractor in Los Angeles).

Additionally, American has received widespread criticism over its new ultra-dense 737 MAX aircraft. In its initial review of the new configuration, Airways Magazine concluded that “while there is no doubt that the 737 MAX represents a potential money-making machine for American, there is also no doubt that part of that potential will come at the expense of passenger comfort and overall product.”

To earn back some of its good favor with frequent flyers, there’s also no doubt that American may need to extend this olive branch of free elite status.

Alaska’s olive branch comes at the expense of its merger with Virgin America and a long fight with Delta for dominance in its Seattle hub.

After a protracted merger with Virgin America through last year, operations at both Alaska and Virgin America have suffered. For 11 months, Alaska’s on-time performance was worse in 2017 than in 2016 — and the Bureau of Transportation Statistics hasn’t reported the 12th month yet. Pressure from Delta, which has strong aspirations for expansion in Seattle, is also keeping Alaska’s marketing department on its toes.

Between grumpy passengers unhappy with performance and the constant threat of passengers defecting to Delta, Alaska’s incentives to keep elite passengers are well-justified.

Whether the trend of loyalty friendliness will continue may depend on how many passengers give up on revenue-based programs and shrug off elite status altogether. But if Alaska and American are any indication, things may soon start getting better for frequent flyers.

— Grant Martin

Skift Stories and More Expert Insight

Points International Claims 2017 Growth for Its Loyalty Tech Platform: Points International, the world’s largest miles and hotel points reseller, thinks its stock price should go up after three and a half years of little movement.

United Airlines Will Add Premium Economy to Match Delta and American: United Airlines intends to add a premium economy section with comfortable recliner seats on long-haul aircraft soon, matching a product already offered by American Airlines and Delta Air Lines, its two main competitors.

Onefinestay Launches Concierge Service With Loyalty Elements: In March, Onefinestay will introduce a concierge service for customers, who will be able to access a mobile concierge through an app after making their first booking on the platform.

United Will Begin Giving Passengers Details About Why Their Flights Are Delayed: United Airlines executives know few things frustrate customers as much as not knowing why their flights are delayed, so starting Monday it plans to test a new system in Phoenix and Houston that’ll tell passengers far more about their late flight than they ever expected to learn.

Wyndham Worldwide Is Buying La Quinta for $1.95 Billion: When we said there’d be more mergers and acquisitions in 2018, we weren’t kidding. The first major hotel industry acquisition of the year involves Wyndham Worldwide and La Quinta Holdings.

JFK Airport Is Getting an American Express Centurion Lounge: American Express, which uses a network of luxury airport lounges to help it attract and retain high spenders, often in larger markets, soon will open its first club at New York’s John F. Kennedy International Airport.

Trump Hotels Is Losing Premium Customers: Room rates at hotels bearing Donald Trump’s name have dropped sharply during his first year in the White House.

Is the Hotels.com Rewards Program Worth Anything? Hotels.com offers a very simple value proposition. It doesn’t matter which hotel you stay at, nor does it matter which loyalty program you belong to. You’ll get one free hotel night after 10 stays. The value of the free stay will be an average of your previous 10 nights.

American Will Offer Free Booze on Chicago-New York Shuttle Flights: American announced hourly flights Monday through Friday between Chicago and New York LaGuardia. These flights are part of a broader expansion at O’Hare for American, and passengers on the flights will see some exclusive benefits. But let’s face it, out of all the “benefits,” free drinks cabin-wide is LEGIT!