aadvantage program overview
TRANSCRIPT
5/21/09
AAdvantage® Program Overview
Campus Rep Orientation2010
Are You a Member?
10 Thousand
64 Million
157 Billion 300 Thousand
283 Thousand
Agenda
AAdvantage Overview
• Airline Loyalty
• Membership Profile
• AAdvantage Organization
• The Strength Behind a Loyalty Program
Acquisition
Engagement
Retention
Perceived Value
Working together – Passenger Sales and AAdvantage
• Sales Tools
AAdvantage Overview
Our VISION: To inspire and sustain loyalty through a dynamic member reward program that provides exceptional value for our Customers, Partners, Employees and Shareholders.
AAdvantage Overview –Airline Loyalty
Members earn AAdvantage mileage credit for their travel when they fly on:
American Airlines
American Eagle
AmericanConnection ® carriers
Oneworld ® member airlines
Other AAdvantage airline participants
AAdvantage Overview –Airline Loyalty
Customers earn elite-status qualifying points, miles and segments when they fly on American Airlines, American Eagle, AmericanConnection, Alaska Airlines (including Horizon Airlines), oneworld® partner airlines or American Airlines codeshare flights
Elite Level Miles Segments Points
AAdvantage Gold® 25,000 30 25,000
AAdvantage Platinum® 50,000 60 50,000
AAdvantage
Executive Platinum®
100,000 100 100,000
AAdvantage Overview –Airline Loyalty
AAdvantage Points are calculated based on the number of miles earned and the fare purchased.
Fare Purchased Points Earned Per
Actual Mile Flown
First Class 1.5
Business Class 1.5
Full Fare Economy(Fares booked in Y or B)
1.5
Discount Economy Class(Fares booked in H, K, M, L, W and V)
1.0
Deep-discount Economy ClassFares booked in G, N, Q (except AA
transatlantic fares booked in Q) and S
0.5
AAdvantage Overview –Airline Loyalty
Full-fare Upgrades
Companion Upgrades
Threshold Upgrades
Plus System-wide
upgrades and unlimited
Comp Upgrades
25% Elite Mileage Bonus 100% Elite Mileage Bonus
Special Service Desk
Priority Access
Preferred Economy Seating Plus Gtd. Economy Seating Plus Expanded Award Seat
Availability
Checked Bag Fee Exempt
Waitlist priority (first/bus class)
Waived AADV Fees
Minimum Mileage gtd.
oneworld travel benefits Plus oneworld lounge
access
Discounted Admirals Club
AAdvantage Overview –Airline Loyalty
AAnytime ® Awards
MileSAAver SM Awards
Upgrade Awards
oneworld ® Awards
All partner Awards
40%
35%
14%
7% 4%
MileSAAver AAnytime
Partner Air Upgrades
Partner Prod.
AAdvantage Overview –Airline Loyalty
AWARD COACH BUSINESS FIRST
Domestic MileSAAver 12,500 25,000 32,500
Domestic AAnytime 25,000 50,000 65,000
Hawaii MileSAAver 17,500 off-peak
22,500 peak
37,500 47,500
Europe MileSAAver 20,000 off-peak
22,500 peak
50,000 62,500
One – Way
Sustaining and Growing our Program is the Right Thing
Freddie Award Spring 2008
Extra Mile Award2009 Best US & Overall Award
Redemption2008, 2009
Highest-Rated FrequentFlyer Program 2009
Best Airline for First Class Service in North America
Best North American Airline for 16th Consecutive Year
North America’s Leading Airline
Best Domestic First Class
Our Membership Group Continues to Grow
Today, there are more than 65 million AAdvantage® members in 242 countries
0
10
20
30
40
50
60
70
2002 2003 2004 2005 2006 2007 2008 2009
49.251.8
54.256.9
59.762.1 64.1 65.5
AAdvantage Demographics
Our Membership Profile
0.0%
10.0%
20.0%
30.0%
40.0%
50.0%
60.0%
70.0%
80.0%
90.0%
US Consumer
AAdvantage Member
Our Membership Profile
Source: 2009 Doublebase Mediamark Research & Intelligence weighted to Population (000) - Base: AllSource: 2009 Doublebase Mediamark Research & Intelligence weighted to Population (000) - Base: All
Influential Members
Profession Finance Technology Purchasing Behaviors
0.00%
10.00%
20.00%
30.00%
40.00%
50.00%
60.00%
70.00%
80.00%
US Consumer
AAdvantage Member
Our Members are consistently on the lookout for ways to earn
more AAdvantage miles
• The AAdvantage member base includes both frequent flyers
and frequent buyers
• Members want to earn miles for everyday purchases and will
modify their purchasing behavior to earn them
In fact, over half of all miles are earned without flying
Buyer
23%
Flyer
49%
Flyer/Buyer
28%
Active AAdvantage Members
AAdvantage Overview –Our Members Behaviors
Best Customer
Miles Earned
Purchased Flown
Our Members are Buyers with a Travel Problem
More than half of all miles earned without flying
Members want to earn miles for everyday purchases and will modify their purchasing behavior to do so
Members who transact with our partners admit that AAdvantage miles impacttheir decisions
Bill K - EYW Herbert - STTValerie - Patagonia
AAdvantage Partnerships –How They Fit
Total $1.4B
84%
International
Credit Card
9%
7%
Citi
2010 Projected Partner Revenue
The AAdvantage Partners –The citi Partnership
First Co-Branded card in the industry
Over 2.8M Cardholders
citi Visa/Mastercard/American Express/Debit Cards
AAdvantage Parnters
Partner Marketing
AAdvantage Connections
Quarterly Statement Mailing
eSummary Email
Statement Inserts
Our members anticipate and expect impactful communications from us, and want us to know how to reach them
Our partners expect us to give guidance to what type incentive works for our members
eSolo Email
AAdvantage Program
AAdvantage Partners
AAdvantage Members
A Strong Program, Membership and Partnership Base
Equals Success For All Who Participate
What Does It Take?
The strength of a Loyalty Program comes from constantly keeping your eyes on:
Step One –Acquisition
We are always looking at ways to locate the most loyal airline customer.
Route specific promotions
aa.com booking path
Step One –Acquisition
We are always looking at ways to communicate the ease to earning miles.
Step Two –Engagement
Connecting members to members creates a rapport within the program.
Step Two–EngagementEducating our members on benefits keeps our program top of mind.
Step Two–Engagement
Mileage MultiplierMileage Maximizer
The visualization of that next trip is a great incentive.
Step Two–Engagement
AAdvantage eShopping Mall
AAdvantage CONNECTIONS
Giving our members easy access to our partners strengthens their involvement.
Step Three–RetentionMembership retention is the foothold of a great loyalty program.
Step Three–Retention
WinbAAck Program -- Identify and contact profitable AAdvantage members whose AA travel activity has declined
RetAAin Program -- Use delay data provided by Customer Relationship Marketing to contact high-profit customers who were impacted by poor dependability performance
Mileage Extension -- Contact AAdvantage members with high mileage balances at risk of expiring
Building one-to-one relationships with our members to increase loyalty and revenue. Each inbound and outbound contact is viewed as a revenue
opportunity for ACS
Step Four–Perceived Value
Eye on the Customer + an Accessible and Flexible Program +
Backed by a World class Airline = Success
Randy Peterson, InsideFlyer
“…it’s a super leapfrog over competitors…”
One-Way Flex Awards – Introduced May 2009
We need to keep a pulse on what is important to our members.
Step Four–Perceived ValueWe then need to invest in our member’s experience On-line
and In Route.
On-line Upgrade TrackingPriority Boarding
Priority Baggage and Waived Baggage Fees
AAdvantage and Sales –Working Together
Both organizations are constantly striving for the same goal:
• Find and deliver new customers
• Create right kind of partnerships that create mutual satisfaction for both partners
Each day we are working through cold leads to determine if they are a right fit for American Airlines
• But have we asked the questions:
Is this a customer that would benefit from corporate travel
program?
Is this a customer that would benefit from partnering with
AAdvantage Marketing?
Our Partners Market With AAdvantage Because We Help Them:
Whatever their goals, AAdvantage miles can help:
Acquire new customers
Retain the ones you have
Cross-sell or increase market share
Motivate your sales force or your affiliates
The Link Between Our Incentive and Their Goal is Our Valuable Member
Database!
AAdvantage and Sales –Working Together
AAdvantage and Sales –Working Together
What type of industry are they in?
Is their product/service something our members would be interested in?
Do they currently market their product/services?
• If so, what type?
• What type of marketing budget do they have?
AAdvantage and Sales –Working Together
Contact Us:
Amy [email protected] 817-967-3981
Megha [email protected] 817-963-5389
Kerri [email protected] 817-967-1416
AAdvantage and Sales –Working Together
Appendix
The AAdvantage Organization
2
President AAdvantage
ROB FRIEDMAN
Director AAdvantage
Partner Marketing
CHARLIE SULTAN
Manager AAdvantage
Customer Marketing
SANDY HERNDON
Manager AAdvantage
Customer Service
JAN FERGUSON
Manager AAdvantage
Database Marketing
YOSHI TANAKA
Manager AAdvantage
Program Strategy
LISA HINGSON
Manager Business
Solutions & Strategy
CHRIS JARRARD
Manager Customer
Loyalty Strategy
WANNA WILSON
Executive Secretary
VICKY SMITH
Manager AAdvantage
Partner Development
KIM PROFFER
Manager AAdvantage
Business Dev
ANNERHODES
Manager AAdvantage
Int’l MarketingESTHER MALDONADO
Manager AAdvantage
Domestic Co-Brand
CYNTHIA BARNES
