Lufthansa Miles and More Program to Allow Mileage Pooling

Lufthansa Miles and More Program to Allow Mileage Pooling

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Lufthansa’s frequent flyer program, Miles and More, is adding a solid new feature to its program. Starting this May, families will be able to “pool” miles together.

Families of up to seven people will be able to combine award miles across accounts — specifically up to two adults and five children. When miles are scattered across accounts, pooling makes it much easier to get enough miles in one account to actually redeem for an award flight.

While most US readers aren’t crediting their Star Alliance flights to the Miles and More program, it’s nice to see that a mileage program is introducing positive changes for its members.

Miles and More has some decent redemptions. You can fly roundtrip from the US to Europe in business for just 105,000 miles.

Miles and More is a transfer partner of SPG, so you can transfer Starpoints to your Miles and More account. The Starwood Preferred Guest Business Credit Card From American Express is currently offering an elevated 35,000-point welcome bonus after spending $7,000 in the first three months.

Other mileage programs that allow pooling include Hilton Honors, British Airways Avios and JetBlue TrueBlue.

H/T: You Have Been Upgraded

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March 7, 2018 at 05:46PM

Take A Trip to Disney via Google Maps

Take A Trip to Disney via Google Maps

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Visiting one of Disney’s Parks just got a little more accessible — and cheaper. Eleven of the renowned parks from California to Florida are now available on Google Street View.

As of right now, Google Street View only covers Disney parks in the United States from Disneyland in Anaheim, California, to Disney World in Orlando, Florida, as well as some of their offshoots like Pandora, The World of Avatar, waterparks and dining and retail locations. Now, you can use Google to help plan a trip, relive memories or stream Google Maps to your screen and pretend like you’re in “The Most Magical Place on Earth.”

Over the past couple of years, Google Maps has started to use its Street View as a tool for tourism. In the recent past, countries in Asia have partnered with Google to bring popular destinations and landmarks available on the company’s Map feature. The US has been more wary of putting public locations on Google Maps and Street View after the tech company was found to be using personal data via its Street View cars.

The following Disney locations are available on Google Street view:

Featured image by Paul Hiffmeyer/Disneyland Resort via Getty Images

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March 7, 2018 at 05:23PM

Check Out Cathay Pacific’s First A350-1000

Check Out Cathay Pacific’s First A350-1000

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Cathay Pacific has unveiled the livery on its newest aircraft, the A350-1000. After Qatar took delivery of the first commercial A350-1000 two weeks ago, Cathay will become the second airline to own Airbus’ long-haul aircraft when its handed over to the Hong Kong-based carrier in April.

Cathay has ordered 20 A350-1000s and is expected to take delivery of them through 2018 and beyond. It currently flies 22 A350-900s, the smaller version of the aircraft and has six more on order. 

The -1000 rolled out of Toulouse, France with Cathay’s classic colors. The pictures from Airbus might seem a bit odd — that’s because the aircraft is currently without engines. The -1000 will receive the Rolls-Royce Trent XWB engines, which were specifically designed for the A350.

Cathay announced the inaugural long-haul flight for the -1000 will be from Hong Kong (HKG) to Washington Dulles (IAD) — coming in at 8,153 miles, it will be the carrier’s longest flight.

Cathay configured the -1000 to seat 46 passengers in business in a 1-2-1 configuration, 32 premium economy seats in a 2-4-2 configuration and 256 in economy in a 3-3-3 layout. The aircraft will seat a total of 334 passengers, a 54-person jump from the 280 that the -900 can seat.

If the -1000 is anything like the -900, then flyers will surely enjoy their experience, especially if they’re sitting in business. TPG‘s Zach Honig recently flew on the -900 from Newark (EWR) to Hong Kong (HKG), calling it “one of the best ways to get to Asia in business class.”

Featured image by Airbus. 

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March 7, 2018 at 04:30PM

TripActions Raises $51 Million Series B for Its Business Travel Service

TripActions Raises $51 Million Series B for Its Business Travel Service

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It didn’t take long for another major example to pop up in the news to illustrate one of Skift’s 2018 Megatrends: “Startups Go Direct to Consumers in Battle for Business Travelers.”

On Wednesday, TripActions, a business travel startup, said it closed a $51 million Series B funding round.

Businesses hire TripActions to run their travel programs, and the startup rewards employees with Amazon gift cards or credits for personal vacation if the workers book cheaper travel than they might have otherwise.

Lightspeed Venture Partners and Zeev Ventures led the round. The investment brings the total capital raised to nearly $80 million.

The Palo Alto, California–based startup, which has 120 employees, will partly use the funding to open an office in London. It will also use the funding to increase the size of its technical and customer support teams at an average rate of five employees a week through the spring.

“We have been blown away by the pace of growth we’ve seen at TripActions with rapid adoption from mid-market companies and small businesses alike,” said Arif Janmohamed, a partner at Lightspeed.

Janmohamed isn’t joking. TripActions makes some bold claims about its success since it launched its services in 2016. The most eye-catching claim from is that it has never lost a customer in the past 18 months, meaning none have tried the service and switched back to the travel management company it had been previously using.

The company claims that the number of customers and travelers under management doubled every quarter in 2017.

It also claims that 97 percent of travelers at companies that adopt its solution use it to book at least some travel — an adoption rate well above the corporate travel industry average.

Rewarding Trend

TripActions, one of Skift’s Most Interesting Corporate Travel Startups, isn’t the only company that has attempted to guide businesspeople to save their companies money by buying cheaper travel.

Rocketrip was a pioneer of the concept. It rewards employees with gift cards they can spend however they want if they book travel within a company’s policy and budget, as its CEO Dan Ruch has explained to us.

Rocketrip raised $9 million in Series B funding in 2016, bringing its total funding to $17.1 million. It is the preferred booking tool of General Electric, Twitter, and other large companies.

Similarly, one aspect of business travel startup Upside’s model is to offer gift cards as a reward to business travelers who book a flight and hotel package to take advantage of the savings it negotiates for bundled trips. In short, it pays business travelers to be flexible. As a side note, Upside’s CEO is Jay Walker, the founder of Priceline.

Other companies have attempted what could be more broadly called “loyalty monetization” by rewarding travelers who book at particular hotels with loyalty points in their favorite airline program. Rocketmiles, which is a brand acquired by Booking.com; Points.com, Switchfly, and TravelBank all have products that attempt to do this.

The direct-to-consumer startups face a marketing challenge in modifying customer behavior from just booking a room to trying to book a room while also earning loyalty miles or points.

In contrast TripActions, like Rocketrip, have the advantage of getting an endorsement from a company’s management to encourage travelers to try and use their products.

Co-founder and CEO Ariel Cohen credits his company’s success to using next-generation technology to provide a more efficient mix of automated and human agent support to its customers.

Co-founder and CTO Ilan Twig claimed he recently was on a flight out of Idaho that experienced a delay that threatened his ability to make an onward connection. He touted that TripAction’s platform, which uses machine learning to mine data and artificial intelligence to power a chatbot feature, helped him quickly rebook to an itinerary that assured he would make his meeting.

True or not, an ability to provide customer service throughout the trip is a critical service that any pretender to the throne of travel management greatness needs to achieve.

Big Picture Disruption

The corporate travel sector has been well-served by its strategy of combining small agencies in a network able to service multinational clients worldwide.

But now it faces a contrast between its labor-intensive expansion and the almost frictionless growth of a network of automated services powered by artificial intelligence and machine learning and self-service behavior created by TripActions and its peer startups.

If TripActions and its similar startup peers gain traction in the mid-market, travel management companies like American Express Global Business Travel and Carlson Wagonlit may face erosion of their business “from below” — as they lose smaller clients.

To be sure, industry heavyweights like American Express Global Business Travel and Carlson Wagonlit Travel have seen upstarts attempt to challenge them before without much luck. Companies such as TripActions, are not even in the conversation with them, in that regard.

Perhaps most notably, in 2008, Expedia launched its Egencia corporate travel brand with a goal of challenging the giants.

A decade on, most Fortune 500 companies like IBM and General Electric continue to rely on established corporate travel players to handle their complex needs.

And Egencia itself is now prone to disruption from startups.

Cohen said his company has already begun to steal mid-market share away from legacy players like Amex and newer ones like Egencia.

Cohen said that TripActions successfully stole away Box, an enterprise software company with about 1,500 employees, away from an overlapping solution provided by Egencia and Carlson Wagonlit.

Cohen said TripAction won SurveyMonkey’s business away from Egencia.

So how have the legacy players responded to the threat posed by a new wave of corporate travel startups?

One response has been to try to partner with the new wave of players rather than fight them. BCD Travel has entered a deal in which it helps TripActions serve some international clients.

That move dovetails with BCD Travel’s “if you can’t beat them, join ’em” approach by recently creating SolutionSource, a platform that makes it easier for travel managers to integrate products and services from startups and technology partners, such as Rocketrip.

Like any new player, TripActions is vulnerable on a few weak points.

It relies on airfare data from travel technology Sabre, which serves many corporate travel managers worldwide, and hotel rate data from Booking Holdings, which owns Rocketmiles that offers a direct-to-consumer competitor product.

If it were cut off from comprehensive data sources like those, it would likely struggle to rebound, despite its founders’ claims to the contrary.

As it adds bigger clients, it will have to become able to cope with bigger problems, such as handling the stratified loyalty status level of executives and ordinary workers and coping with complex airfare ticketing fee deals and technology systems that airlines increasingly want.

TripActions also needs to watch its costs and not overreach as another similar startup, Lola, appears to have done. Lola, founded by former Kayak creator Paul English, began as a service offering to use next-generation technologies to give superpowers to travel agents to serve travelers efficiently via chat.

The mobile booking app, which officially began focusing on business travel full-time late last year, is now working on providing more advanced software to help manage and track employee travel for existing clients, as we reported on Tuesday. This move helps it avoid playing a costly direct-to-consumer game of trying to acquire customers at scale.

Such are the hurdles that must be overcome by companies attempting to innovate in industries dominated by a handful of giants.

Photo Credit: For years, TripActions co-founder and CEO Ariel Cohen (left) and co-founder and CTO Ilan Twig had been frequent business travelers hamstrung by the outdated travel management systems their companies used. So they think they’ve built a better mousetrap to try to fix the problem. TripActions

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March 7, 2018 at 04:22PM

Chaotic Fight Breaks Out on Southwest Flight

Chaotic Fight Breaks Out on Southwest Flight

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Things turned physical on a Southwest flight on Friday when one passenger started throwing violent punches at several other fliers.

A video posted to Snapchat shows one passenger in a grey hoodie lunging and punching at another man who is standing underneath the plane’s overhead bin. That man then falls into his seat after the punch. A man in a neck pillow tries to stand up and intervene, only to be punched several times as well. The man throwing punches is restrained in a choke hold by another passenger at the end of the video.

The flight, which was from Dallas Love Field (DAL) to Los Angeles (LAX), was delayed due to the chaotic scuffle.

“On March 2, Southwest Airlines flight #8 scheduled Dallas Love to Los Angeles was delayed departing due to an altercation between two passengers,” Southwest told The Daily Mail in a statement. “The passengers involved were deplaned and local law enforcement took over from there. The safety and comfort of our Employees and passengers is our top priority.’

The altercation was reportedly over a missed flight connection, the passenger who took the video told The Daily Mail.

Dallas authorities say one person was detained after the incident, according to The Washington Post, but didn’t give any other details.

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March 7, 2018 at 04:15PM

News: ITB Berlin 2018: Qatar Airways unveils host of new destinations

News: ITB Berlin 2018: Qatar Airways unveils host of new destinations

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Qatar Airways chief executive Akbar Al Baker has detailed the airline’s aggressive expansion plans at ITB Berlin.

In total the carrier will launch 16 new destinations for over the next two years.

At the Qatar Airways press conference, attended by almost 200 members of the international media, Al Baker announced a raft of forthcoming global destinations for the airline in line with its expedited expansion plans, including the announcement that Qatar Airways will be the first Gulf carrier to begin direct service to Luxembourg.

Other exciting new destinations to be launched by the airline include London Gatwick, United Kingdom; Cardiff, United Kingdom; Lisbon, Portugal; Tallinn, Estonia; Valletta, Malta; Cebu and Davao, Philippines; Langkawi, Malaysia; Da Nang, Vietnam; Bodrum, Antalya and Hatay, Turkey; Mykonos and Thessaloniki, Greece; and Málaga, Spain.

In addition, services to Warsaw, Hanoi, Ho Chi Minh City, Prague and Kyiv will increase to a double daily frequency, while services to Madrid, Barcelona and the Maldives will increase to triple daily.

Al Baker said: “Qatar Airways is tremendously excited to announce further expansion with a significant number of new destinations to be added to our extensive global network throughout 2018 and 2019.

“This is a direct reflection of our commitment to connecting travellers across all corners of the world in a way that is meaningful and convenient to them.

“We are committed to continuing our ambitious growth strategy, in order to be able to provide our passengers with as much choice as possible and to take them anywhere in the world they wish to go.”

He also spoke passionately about the blockade against Qatar: “During the blockade Qatar Airways continued its expansion; it continued its march ahead.

“We kept our country supplied and we became prouder as a nation.

“The blockade made my ruler an icon of defiance.

“Today, we are more independent than we were nine months ago.

“We are very defiant, and Qatar Airways will keep on expanding and keep on raising the flag for my country all over the globe.”

Further developments for the upcoming year were discussed, including additions to the airline’s sporting sponsorship portfolio.

Qatar Airways is already the official sponsor of many top-level sporting events, including the 2018 FIFA World Cup Russia, the 2022 FIFA World Cup Qatar and the FIFA Club World Cup, reflecting the values of sports as a means of bringing people together, something at the core of the airline’s own brand message – Going Places Together.

Qatar Airways currently operates a modern fleet of more than 200 aircraft via its hub, Hamad International Airport (HIA). Just last month, the airline welcomed the Airbus A350-1000, for which it is the global launch customer.

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March 7, 2018 at 04:08PM

Chinese Tourists Spent Less Per Trip on Outbound Travel in 2017

Chinese Tourists Spent Less Per Trip on Outbound Travel in 2017

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Tourism constitutes a key pillar of the Chinese government’s efforts to transform the country into a global leader. One aspect of this is by encouraging outbound Chinese tourism to countries around the world to illustrate that a relationship with China is potentially lucrative.

However, arguably more important for the Chinese government is part of efforts to drive consumer spending to help China transition from an export-oriented economy to a consumption-oriented economy. In this regard, the growth of domestic tourism is much more significant for the government than outbound tourism, and the numbers for 2017 show how domestic tourism growth is far outstripping outbound tourism.

According to Ctrip and the Chinese Tourism Academy (CTA), 2017 saw record numbers of Chinese citizens going abroad. In total, Chinese travelers made 130 million trips abroad, resulting in $115.29 billion in spending. This means growth of 7 percent and 5 percent in the number of trips and spending overseas respectively. That means more Chinese travelers are going abroad that ever before, but are spending less on average per trip.

Domestic Tourism Growth Was Robust

Conversely, China’s domestic tourism industry raked in $720 billion in revenue and Chinese tourists made 5 billion domestic trips. That represents growth of 15.9 percent and 12.8 percent in revenue and the number of trips respectively.

Unlike outbound tourism, Chinese domestic tourists are not only traveling more but spending more per trip. All of this is good news for a government hoping to drive China’s consumption-oriented economic transformation.

The task of transitioning the Chinese economy into a consumption-driven economy has proven especially challenging in China, in part because Chinese consumers save a much larger portion of their incomes compared to most other countries.

According to the World Bank, in 2016 the global average of gross savings to GDP was 24.4 percent and the United States had a gross savings rate of 18.09 percent. China, on the other hand, had a gross savings rate of 46.05 percent.

A high savings rate isn’t necessarily bad for any economy. In times of economic distress, it means that consumers are more likely to have personal safety nets that can help ride out economic hardship. However, money saved is money not going directly into the economy via consumption of goods and services to drive growth.

In terms of consumption, the world’s second largest economy is lagging behind the rest world despite its rapid growth in GDP. For example, the ratio of consumption to GDP in the United States stands at 68.83 percent, compared to 58.35 and 39.01 percent for the world average and China respectively.

Encouraging Signs for the Chinese Economy

It’s for these reasons that the rapid growth of domestic tourism is a particularly encouraging sign that China is on its way to encouraging consumption growth. While outbound tourism is by far more lucrative per tourist than domestic tourism when it comes to Chinese tourists, a large portion of this revenue is spent outside of the Chinese economy. That’s money that’s leaving circulation within the Chinese economy and cannot be taxed by the Chinese government.

While many Chinese tourists book through Chinese online travel agencies (OTAs), fly abroad via Chinese airlines, and travel with Chinese tour groups, Chinese tourists inevitably need to book local accommodation and meet their daily needs by purchasing goods and services through local businesses. That’s not to mention the large amount of money Chinese tourists spend at duty-free shops and other retail outlets. With a Chinese government keen on curbing capital flow out of China, encouraging the growth global Chinese tourism companies is increasingly important for the state.

Along with tracking the flow of capital both in and outside of China, the rise of mobile payments like Alipay and WeChat Pay ensures that more of outbound tourist spending returns to China.

Conversely, in China, tourists are all but guaranteed to travel exclusively with Chinese companies and most still take state-run transportation, whether it’s Chinese rail or state-owned airlines. Moreover, most major tourists sites in China are run by the state. Thus, domestic tourism results in high-levels of consumption in a short period of time, which means a substantial level of revenue for the Chinese government either through taxable transactions or ticket sales.

This story originally appeared on Jing Travel, a Skift content partner.

Additional links from Jing Travel:

Photo Credit: Chinese tourists pose for a photograph at the main entrance to Chiang Mai University in Chiang Mai province, northern Thailand March 30, 2014. Chinese tourists spent less per trip in 2017 on foreign travel than they did a year earlier. Associated Press

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March 7, 2018 at 04:01PM

New Skift Research Analyst Session: Hotel Owner Operating and Branding Strategies

New Skift Research Analyst Session: Hotel Owner Operating and Branding Strategies

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Skift Research is publishing a new Analyst Session, available to subscribers only as an accompaniment to our recent Research Report, A Deep Dive Into Operating & Branding Strategies for Hotel Owners.

Preview Session

Brands are consolidating, consumer preferences are changing, disruptors are impacting the distribution landscape, and technology is evolving. Hotel owners face an increasingly complex environment in which they must choose the single, best operating model and brand strategy for a given property. Easier said than done.

During the session, we discuss operating and branding strategies for hotel owners in today’s environment. We review different ownership operating models and the pros and cons of each, the benefits of brand affiliation versus remaining independent, and our proprietary Brand Matrix, which ranks the seven major brand chains according to 13 key qualitative metrics. We also provide our expectations for distribution costs, management contract terms, soft brands, non-branded operators, and independent hotels.

Our view is that there is no “one size fits all” strategy or model that hotel owners should follow. Decisions must be made on a property-by-property basis. Nevertheless, hotel owners can’t be idle, and should continue to be innovative, adaptable, thoughtful. They should also be willing to push back on their managers and franchisors to produce the best results. At the end of the day, the objectives remain the same: Acquire or develop strong real estate, ensure the property is run as effectively and efficiently as possible, choose the right partners, and never lose sight of that hospitality factor. This is a people business after all.

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This is the latest in a series of research reports, analyst calls, and data sheets aimed at analyzing the fault lines of disruption in travel. These reports are intended for the busy travel industry decision-maker. Tap into the opinions and insights of our seasoned network of staffers and contributors. Over 200 hours of research, data collection, and/or analysis goes into each report.

After you subscribe, you will gain access to our entire vault of reports, analyst sessions, and data sheets conducted on topics ranging from technology to marketing strategy to deep-dives on key travel brands. Reports are available online in a responsive design format, or you can also buy each report a la carte at a higher price.

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March 7, 2018 at 03:32PM

American Airlines Knows if You’ve Been Cheating on It With a Competitor

American Airlines Knows if You’ve Been Cheating on It With a Competitor

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Editor’s note: This series, called Airline Insiders, introduces readers to behind-the-scenes decision-makers for airlines. Unlike our ongoing airline CEO series, Future of the Passenger Experience, we will not question the highest-ranking executives here. Instead, we will speak with insiders who guide decisions on airline operations, networks, marketing, and the passenger experience. 

Today, in the sixth installment of the series, we speak to an architect who has designed terminals at many of the world’s largest airports.

You can read all the stories in the series here.

Not long ago, loyalty programs at major U.S. carriers were simple. They almost always rewarded customers miles based on how many miles they flew annually, often without considering what the passenger was worth to the airline.

Some road warriors remember those days wistfully because they could earn impressive perks while flying a lot and spending little. But from a revenue perspective, it never made sense. Why would a company reward its most frugal customers?

At American Airlines, Bridget Blaise-Shamai, the carrier’s vice president for loyalty, is helping shift the program to one that rewards its most lucrative members with the best perks. And as it transforms, American seeks to learn more about makes these customers tick, so it can make predictions about their wants and needs. In some cases, American can predict a high-value customers is at risk of leaving American even before the consumer switches to another airline.

The key is data. American’s program, AAdvantage, has long had unusually rich information about its members, but until recently, it hasn’t leveraged it. “I often joke, even when we as an industry are a bit cash poor, we’ve always been rich in data,” said Blaise-Shamai.

Skift recently met with Blaise-Shamai, and her colleague, Alice Curry, managing director for customer loyalty and insights, at American’s Fort Worth, Texas headquarters to discuss the brand’s approach for the eighth installment of our Airline Insiders series.

Note: This editor has been edited for length and clarity.

Skift: Why is loyalty so important? Why can’t I just buy the best fare every time? Why must American Airlines own me?

Bridget Blaise-Shamai: With loyalty comes proven behavior of consolidating spend with you. There’s less of that at the moment decision of whether I should pick this airline versus that airline. It is an underlying sense of, ‘This is my brand. This is where I had my experiences and this is where I feel the greatest affinity.’

Skift: Why are people loyalty to American? Is it usually simple, like you have a hub in their hometown?

Blaise-Shamai: For a lot of our customers, the fare is it, first and foremost. To another segment, the program itself will be the first and foremost consideration. And then to others, it can be our staff — like for Concierge Key, [American’s highest frequent flyer tier.] There’s not necessarily one global attribute. Pricing resonates more frequently. But there’s other attributes that simply come into play.

Skift: Delta Air Lines Chief Marketing Officer Tim Mapes often talks about splitters — or consumers to who fly different airlines. He’d like to get them to fly Delta exclusively. Do you also track people you think are splitters?

Blaise-Shamai: There is certainly fragmentation. There are a host of reasons why customers choose to do it. What we strive to do is use pretty clever data and analytics looking for customers that we have a pretty good hypothesis are high-value customers in another airline’s program. we’ve had significant success on doing that for some time.

I don’t know whose program they may be a part of. I just have enough about them that would give me a very good success rate on being more right than not — that they are high dollar customer in another competitors program.

Skift: What data do you use to make this determination?

Blaise-Shamai: Well that’s something we don’t share.

Skift: You know so much about your customers? But the knock is that airlines rarely do much with their data. Are you working to leverage it better?

Blaise-Shamai: Airlines have forever been rich in data at the customer level. You do something with us, we’re more than likely to have captured that. You earn a mile, you redeem a mile, you fly on us, we lose your bag, we leave on time, we don’t leave on time, you log into dot-com, you download something off the mobile, you check-in at the kiosk.

I often joke, even when we as an industry are a bit cash poor, we’ve always been rich in data. You will see more attention on how we make that work harder for us and for our customers. We also have what I consider a very enviable set of organic marketing channels because travel is so important to so many of our customers.

We’ve got a group of customers who travel frequently and then we got a much larger group of customers who travel a whole lot less. The group of customers who are very frequent in their interactions with us are very trusting of information coming from us. We find that messaging them using our data and other organic benefits like incentives — miles and upgrades and seats and priority boarding — gives us a lot of space to go forward in a much more relevant, individualized way. But we’re also thinking about how we become more real-time responsive with our customers.

Skift: So you know more than just how often I travel?

Alice Curry: We’ve been capturing the transactional stuff forever but now we’re trying to make sure we better understand what your experiences have been with us — if you traveled 15 times on us last year, we were on time 13, you were delayed twice but one of those delays was six hours. Or we lost your bag, or those types of things — trying to better understand what your experience has been with us versus just that you flew 15 times to these places.

Skift: Can you give an example of how you’re using data to increase loyalty?

Curry: We have a win-back program where we look at people whose travel has fallen off fairly dramatically and we pick up the phone and call them and ask why and have a conversation with them to [ask] if there is something we could do to bring them back.

That program is kind of a long tried-and-true program. But what we’ve done recently is we started taking all the information and using predictive modeling to figure out what is the chance that you might be about to step away from us — versus waiting until you’re already gone. Often times, people just want to make sure we know that we have not met their expectations and then we can talk about things that we can do to get back on track with them.

What we’re now doing is looking at, here are people who have left American. What were the attributes that we saw that led up to that? And then we mirror that on top of existing customers to say — I’m making these things up — if lose your bag more than twice, then your likelihood of defecting goes up by X percent. We take all of those different factors and we look at our at-risk list. Then we can go out and proactively talk to those customers, making sure we’ve appropriately compensated them.

Skift: How does the compensation work? Are you trying to get away from a one-sized-fits-all model?

Curry:  We’re still evolving from looking at things on a transactional basis. I may give you 10,000 miles because you were delayed four hours, [as a matter of policy.] But we’re trying to [change] so I may give you 20,000 miles because this is your third time for being delayed. We’re trying to look more at your whole experience with American instead of just that one transaction.

Skift: At every industry conference, executive debates whether flight attendants should try to ‘guess’ what customers want to drink. Their tablet might say, ‘this customer almost always drinks gin-and-tonic.’ And then the flight attendant would drop off the drink before the customers asks for it. Would you do that?

Blaise-Shamai: I think anticipatory or even latent demand is an amazing place to be. We hold ourselves up to that standard. [It’s] not easy because sometimes that moment is not one when the customer wants that drink proactively handed to them. [Maybe] the last seven times you had the gin and tonic, and that day that person may not be feeling it. But you take that risk, on the likelihood that that feels really good for the customer.

Skift: You’re not doing the gin and tonic thing now, right?

Blaise-Shamai: No, not today. But the complete view, it’s part of what we’re striving for.

Skift: We’ve spoken about elite benefits, and for many business travelers those are important. But what about frequent flyer redemptions? Travel bloggers don’t know all, but some accuse American of being stingy with the free seats it offers.

Blaise-Shamai: We work in partnership with our colleagues in revenue management, so we represent the demand, and they represent the supply. I think it’s fair to say we’ve very public about where we’ve been, and we recognize we have opportunity. We’ve also been equally public about where we’re going. We have set forth a goal to be very competitive with other network carriers. In the last part of the year — the last six to eight weeks of 2017 — these improvements started hitting the market. Award travel is markedly up and directionally going the right way.

We are still working to go higher and we have all confidence we will be there in 2018 given all that we are doing.

Skift: Do you get pressure from your bank partners, Citibank and Barclays, to make more free seats available? They buy miles from you, which they use to reward card-holders. Presumably it’s important for them for their customers to be able to redeem these miles?

Blaise-Shamai: No. We listen to our customers. And certainly under my purview as well is our partnerships with our banks and other partners. We know that we have our responsibilities in terms of the partnership, but I wouldn’t say it’s what we would talk about between the parties, anymore than we talk about what the APR is on the credit card for example.

Skift: Other airlines are trying to come up with more creative ways for customers to use their miles. They might, for example, let you use miles to buy pricey champagne in the lounge. Would you like to to do that more of that?

Blaise-Shamai: Absolutely. It’s about, how do you make sure you provide relevant value propositions to a group of customers who self-select into a travel program? We have tested things in the past, [but that doesn’t mean] whatever didn’t work yesterday wouldn’t work again tomorrow under a different set of conditions.

Where we’ve had some successes beyond flights and upgrades has been travel related. You have seen us test car and hotel. And guess what? It has stuck around, [along with] club [memberships] and vacation packages. We are looking to extend where it makes sense, where it would be relevant.

I wouldn’t expect us to go look at hard goods, at least not as a priority. But look for us to do things that are kind of satellite or tangential to travel. Is your example the one that’s going to pop first? Ha ha. I don’t know. But it’s consistent with how we’re thinking about the extension.

Photo Credit: Flight attendants serve drinks to American Airlines business class passengers. Someday, American could serve its best customers what it thinks they’ll want — before they ask for it. American Airlines

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March 7, 2018 at 03:04PM