On Monday, the Fort Worth-based carrier announced it was adding a minimum spending requirement to its frequent flier program as it unveiled more details of transitioning AAdvantage to a revenue-based mileage accrual program.
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Shares of American Airlines (AAL) are rising 1.27% to $31.19 in late-afternoon trading as the airline operator will now award frequent flier miles based on ticket price rather than distance flown.
“The more you spend on travel, the more benefits you will be offered”, American’s managing director of customer loyalty and insights Bridget Blaise-Shamai said in a conference call with reporters Monday.
For years, airlines have been turning air travel, which used to be about getting from place to place in relative comfort, into a status competition geared toward the biggest spenders.
American had announced last fall that the changes were coming to the program that has over 100 million members. Elite-status members of the AAdvantage loyalty program will earn even more points per dollar spent.
American said customers will begin being able to see an estimate of the number of miles and elite-qualifying credits they will earn for a chosen itinerary when booking their trip on aa.com beginning later this month.
For example, to achieve Platinum status, an AAdvantage member now has to either fly 50,000 miles or 60 flight segments in a year.
To obtain Gold status, AAdvantage members will have to earn 25,000 elite-qualifying miles and spend $3,000.
After Delta and United announced that they would switch to spending-based rewards in 2015, American responded by giving bonuses to high-fare customers. Currently, American sorts its upgrade lists by status – Executive Platinum, Platinum and then Gold – and then clears upgrades within each of those categories first by full-fare tickets and then by when the upgraded was requested. But the AAdvantage program was originally based on the comparatively simple idea of awarding one program-mile for each mile flown. A fourth level will be added just below executive platinum.
Besides Delta and United, spending-based rewards are now the rule at Southwest Airlines, JetBlue Airways and Virgin America.
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