When I saw Maya Leibman, President of American’s AAdvantage loyalty program, put out a video talking about new benefits for elite members, I knew I wanted to put together an Across the Aisle interview. For those who haven’t seen it, here’s that video.
See, Maya’s video had plenty of corny jokes, and that’s my kind of humor. More importantly, it’s NOT the kind of humor I ever expect from American. (I, uh, don’t expect any humor from that airline.) We virtually sat down last week to talk shop.
Maya: I’d like to say there was all this forethought and it was a statement on our brand’s evolution, but it was really about the fact that we had been planning a lot of really big implementations – the high end credit card, the dynamic air award, million miler. . . . All these really big things were supposed to come out scattered throughout the year. It turns out some things got delayed, some got moved up, so we ended up doing all 5 of them in a month or two month period.
We were sending out emails and I was afraid people weren’t reading them. I think it’s true, email is getting saturated as a channel, so we really wanted to do something to cut through the clutter and hear about all the hard work we’ve done. So that was really the genesis. Then we realized it had to be funny and entertaining because nobody would sit through a 4 minute video that was boring. I certainly wouldn’t. The email had a 50% open rate, and that doesn’t count all the people who viewed the video through the website, FlyerTalk, MilePoint, and it got picked up on local news.
Cranky: Did you say 50%, 5-0, open rate?
Cranky: Wow. So is that your personality?
Maya: Yeah, yes. I mean, I wrote it. I think sometimes at American we take ourselves too seriously.
Cranky: I assume the video is just one piece, or shall we say, cornerstone, of your vision for AAdvantage. Can you get into your high level view of where you want to take the program?
Maya: That’s a big question. Our main objectives this year as we talk internally were first, around attracting and retaining our best customers. Clearly a lot of what we talked about in the video are things we’ve done that are designed to retain loyalty of best customers.
Another was around ensuring that we enhance and better communicate the utility of the mile. We know that we’re competing against not just Mileage Plus or SkyMiles. It’s Starwood Preferred Guest, Membership Rewards, they all have very compelling propostions. One of the things we’ve done recently is really enhance the ability, the way you can use your miles, car and hotel awards, dynamic air option, a couple of things coming up in the next few months.
And the third objective was around harnessing the passion people feel for the program. You know better than most that people feel so utterly passionate about airlines, about frequent flier programs, about everything associated with the business, and it felt to me like there was a better way to tap into that. We’ve done that via social media, AAdvantage Facebook and Twitter accounts, and having much more of a dialog. We did a lot of things around the Super Bowl, and for our 30th anniversary, just choosing a flight and giving everyone miles.
Cranky: What about next year? Are the goals different?
Maya: Good question. We’re crafting our 2012 objectives, these all stay and they evolve a little bit and we’ve added to these a couple other objectives. One is around our alliance partners, around improving our proposition on alliance partners. You know BA just introduced a Ruby tier, their base level tier that allows our Gold elites to have benefits on BA which they didn’t do. We’ve introduced three new partners, Etihad, Air Berlin, and Kingfisher for accrual.
Cranky: I’m very interested in the Alaska announcement the other day, which I ended up writing about. Can you talk about the decision to do that? Are you looking to strengthen the relationship with other non-oneworld partners?
Maya: Our first focus is with oneworld, but we have a bunch of non-oneworld partners that are also very valuable: Alaska, JetBlue, WestJet. So we’re also focused on ways that we can strengthen those relationships.
Cranky: A reader wanted to know specifically about JetBlue. Any chance of earning elite qualifying miles? How do you view that partnership?
Maya: I can’t say what we’re gonna do but that’s obviously – New York is a cornerstone for us – so JetBlue is an important component of our alliance partnership. It’s hard when airlines aren’t in oneworld to figure out the sweeet spot but we’re looking at ways to strengthen it.
Cranky: Obviously a lot of airlines look at their elites as the key to success and focus energy on them. How do you look at general program members? What, if anything, do you do to try to make the program more attractive to them?
Maya: It’s very important. As important as elites are, they’re a very small component. Everything that we do, for what we do for regular members and elites, they both equally come into the equation.
I think one of the biggest things we’ve done is really just make it easier to earn miles and redeem them. The number of partners, the number of ways you can earn miles, the number of partners you can earn them with is just staggering. I think one of the things is the general AAdvantage member cares about maximizing earning potential and then being able to use those miles. On the air miles, we’re proud that we carry a larger percent of award traffic and we’ve developed all these non-air ways to use their miles – to bid on auctions for example.
Cranky: At least one of my readers appreciates the options. He sent this tweet:
@crankyflier No questions, just thank them for having so many retail partners to shop and get miles on. Did xmas shopping via their website
You probably love hearing things like that?
Maya: Yeah, the shopping platform and dining platforms are great. It’s a no brainer way to earn miles. If you’re already dining or shopping, there’s no extra spend required.
Cranky: That’s why I think it’s so funny that people get angry when their miles expire. It’s so easy to keep them active.
Maya: Yes, but the other thing that’s a benefit to a regular member is that we make it not so difficult to reactivate. Just show some re-engagement and we’ll give ’em back to you. There are a couple of things they have to go through and it can depend upon how many miles they want to reactivate, but it’s not unreasonable to ask.
Cranky: With everyone else going though mergers right now and seeing massive program changes, what kind of opportunities do you see coming available? I was at the MegaDO launch and there was a lot of talk from United elites expressing unhappiness with the program.
Maya: You know, having gone through mergers ourselves, you know that it’s easy for those companies to take their eye off the ball because there’s just so much involved trying to bring two giant entities together. We see this as an oportunity to reinforce our proposition, show those areas where we think we have a competitive advantage.
Cranky: So are you actively targeting these customers?
Maya: We’re always looking for ways to attract and retain our best customers. We’re looking for oppotunities to bring more into the fold. I think you saw with the MegaDO with the launch party, with the status challenge which is certainly doable for that crowd.
Cranky: How much time do you spend looking at big picture changes? I mean, the idea of trying to better align the program so it rewards profitable customers (maybe via more revenue components). Is that something that you constantly look at or is it too difficult to make the change?
Maya: We certainly look at it. We look at what all the options are. Right now we’re thinking about what loyalty looks like 5 years from now, the future of the loyalty program. It’s a very competitive industry so you don’t want to do something that’s so out of the realm that it’s going to put you at a competitive disadvantage. So you strike a balance trying to make incremental enhancements to improve the position and at the same time you’re ready to capitalize if the industry moves in a different direction.
Cranky: But in terms of shifting the program to one that probably does more of what you want, encourage additional spend, reward people for buying higher?
Maya: There are things you can do on the edges, like the elite rewards program which is based on points instead of miles. It doesn’t penalize those who earn on miles because you still make the same progress but on higher value fares you earn more quickly.
Cranky: Thanks for taking the time to chat, Maya. I appreciate it.
After we finished, Maya had questions for me. She asked about my post on Alaska’s program, really trying to get a sense for how it would impact American. It’s great to see someone running a loyalty program who is so interested in customer behavior. I look forward to seeing more from Maya in the years to come.