American Airlines’ invitation-only “elite status” membership program, ConciergeKey, is one of the more mysterious lagniappes aimed at a carrier’s highest spending frequent fliers.
In declining a request for an interview about one ConciergeKey holder’s frustrations, American Airlines’ media relations told Kambr Media that “we do not share details on the Concierge Key program beyond that it is invitation only.”
The ConciergeKey program barely gets a mention in any of American Airlines’ promotional materials. There isn’t even an officially published list of criteria to be considered for the ConciergeKey invitation, unlike other American Airlines status levels, The Points Guy notes.
The offering’s enigmatic quality is probably why people who get dismissed from ConciergeKey tend to get so vexed when it happens.
That was the case in March for Rishad Tobaccowala, an ad agency veteran currently serving as the chief growth officer for Publicis Groupe in Chicago. After being informed that he was no longer in the program, he tweeted at American Airlines:
After nearly a dozen responses from his followers, American Airlines reached out to Tobaccowala to say that all was forgiven. In the end, Tobaccowala shrugged off the whole thing. Still, he does feel that his interaction with the airline presents a good marketing case study for elite customer loyalty.
Kambr Media: How long have you been a member of American Airlines’ ConciergeKey and United’s Global Services?
Rishad Tobaccowala: I obviously fly a lot. I’ve been at the highest level of both United and American Airlines frequent flyer miles, which are Executive Platinum and 1K. I had also been provided with access, by invitation, respectively, to United’s Global Services and American Airlines’ ConciergeKey.
What sparked the tweet on March 28th?
Late last year, in November, American had called me and told me that I would not be able to remain on ConciergeKey unless I spent another $10,000.
Now, as of last year, I was on track to end up with about 140,000 miles and 40,000 dollars of spending on American ( to be Exec Platinum you need 100,000 miles and 15,000 dollars). I had also flown 4 million miles.
There are two problems here. How does anyone who is fiscally responsible increase spending by 10,000 dollars in few weeks. After all, I’m primarily flying for business. I’m not just flying all these miles just for the sake of flying. So that doesn’t make sense at all.
Secondly, the transactional nature of the deal just felt wrong.
As a result, I asked my assistant to put me on United Airlines for future trips, as long as the fares were the same. since that airline was also accepted for company travel.
Not surprisingly, when 2019 began, I was not what they call “a Key.” I was fine with that. It’s nice to have as a very frequent traveler, but irrelevant in the grand scheme of things.
But then, I started getting calls from American Airlines saying, “We've noticed that you're flying less.” I said “I am flying less on American and more on United, which has retained me on Global Services, rather than your airline, because you didn't keep me in ConciergeKey.”
The American representative said, “But does United have as many good routes as we do?”
I told the American representative that I live in Chicago and United actually has better routes from there. I added that anything that American does, United does even more from Chicago.
Again, I mentioned to the American representative that United is one of the two accepted airlines for our company from Chicago. So I said, "I'm flying more on United."
The American Airlines representative then said, "I didn’t know that, I will tell our management. But thank you very much for giving me this info. And I'm giving you 10,000 miles."
I said, "Thank you for listening, and I am very grateful for the points.”
Did you just want to vent or did you think this might be the best way to have American Airlines resolve the frustration?
After that exchange, I tweeted that it's kind of surprising when they call you, after they take something away, and then they kind of wonder why you are flying less. What's surprising is that they’ll tell you to spend $10,000 and if you comply, we will keep you in this program. But if we take you out of it, we don't think it's going to affect the way you spend. How do they think that works? What do they expect people in that situation will do?
Either I'm their hamster on the wheel or I'm not their hamster on the wheel. You can't basically treat me as hamster certain times and other times, not.
Initially, when I wrote that first tweet, where I noted that their algorithms sucked, I got an automated robo-tweet back from American Airlines. In response, I tweeted, "Listen, American, your robo-tweets suck too."
It's clearly automated. Anybody with half a brain knows it's automated.
Then, the next day they sent me a very nice note. American said they looked at my issue and were reminding me that I had been challenged in November to spend $10,000 more and I had fallen short. “So obviously, we can't put you back in ConciergeKey.”
I wrote a nice note back thanking the airline and saying I completely understand. But I would like you to forward this other note to your management. And that particular message was the one that I put on Twitter.
So the conversation was all very civil. and I noted, "Look, I've flown many miles, and I will continue to fly with you.” And, at the start of this year, I started flying American quite a bit now. So everything is fine.
American sent me a thank you note in return and said that they’re passing on my message on to management.
How did comments that your tweets received about the situation with ConciergeKey influence your follow up with American Airlines?
I've been thinking a little bit more about this situation, would like to share a point of view which I developed after reading the responses I got from Twitter followers, amongst which there were a lot of people who had flown much more than I have with American. I'm an amateur in comparison. There are people who have flown 6 million, 7 million miles. There are people who had flown 250,000 miles last year and many million miles in total but had ConciergeKey revoked with no explanation.
A lot of very important flyers have no idea why this recognition was taken away. And those people had all been upset and voiced this on social media.
In my note, I said it seemed that the Key program could be better designed without adding costs.
What were your solutions for ConciergeKey?
With ConciergeKey, the best I could tell, members got six benefits. Number one, you get on the plane first. Number two, in certain airports like Chicago and New York, you have a “special door” that people can enter to get them to the head of the TSA pre-check line. Third, you have a dedicated number that you call when a member needs something from American Airlines and sometimes they pro-actively re-book you.
The fourth benefit is that, once in a while, you have someone say hello to you before you get on the plane. The fifth benefit gets you entry into a special area of Admirals Club.
The sixth benefit -- and the one that I care the most about -- is the special entrance in airports like Chicago and New York, which I tend to fly out of the most. Thanks to that benefit, I can get to the airport relatively late and still get to the front very fast. The sixth benefit is the pro-active rebooking.
Looking at all the benefits of ConciergeKey, as I can tell, the marginal cost for the incremental benefits you get is close to zero.
In essence, the cost of letting a three, four, or five more people enter the plane ahead of everyone is zero. The cost of letting a few more people enter through a special door is also quite minuscule, since it’s already been built. The same is true for allowing a few more people into the Admiral’s Club.
So, the incremental damage of removing people from ConciergeKey is far greater than the incremental cost of keeping them on. This causes people like me to ask rhetorically, “What, am I no longer special? Maybe I’ll choose another airline that still regards me as a highly-valued traveler.”
What other advice do you have for American Airlines’ management of ConciergeKey?
American Airlines should do two basic things with ConciergeKey:
1. ConciergeKey is for long term loyalty and is given for life: American Airlines can decide that threshold at X million miles – it might be 3 million, it might be 4 million. But once you have achieved that status, you are going to remain in ConciergeKey. This is recognition for loyalty and years of spending.
2. Separate Long term Recognition Program from Ongoing Reward Programs: Give people free miles that are not just based on being in ConciergeKey, but on how much they flew the previous year. For example, if one flies a little less in a given year, one does not get the multiplier when earning rewards. Giving a ConciergeKey traveler a separate recognition comes with limited marginal costs from rewards.
What happens is if I'm ConciergeKey for life, but I only fly ten thousand miles? I don't get multiple miles like a person with 1,000 miles or someone with Executive Platinum gets. Because that should be based on what I did last year, not on my lifetime of flying with a particular airline like American.
Therefore, if there's a marginal cost which involves giving people more points, that's real liability on your balance sheet, which you can limit.
When you give reward points, such as miles, you have to put it on your balance sheet as a liability, because it is a future expense. Therefore, the more the miles you give, more the liability. If you separate loyalty from rewards, and give rewards only on recent flying behavior (i.e., “I flew only 10,000 miles last year, I get only 10,000 miles for credit…”).
That’s in contrast to today, where a ConciergeKey member gets a multiple of your actual miles (2x, for example).
“ConciergeKey For Life” could end up as costly expense, since everyone would get a multiplier for your last year’s level.
I haven't heard back from American Airlines on those ideas yet. I sent them a very nice, civil letter because I was thinking as a business person. I was looking at marginal costs, marginal benefits, what's the customer relationship management.
What does this experience say to brands about the way elite membership rewards programs need to change?
As I ended my note to American Airlines, what they aren't computing is the emotional impact of the actions they take. They don’t compute what happens when people get eliminated from a rewards program; customers can get much more pissed off than the airlines think.
So airlines should consider how to include more people in elite programs, because it’s worth the marginal cost to keep the offering special.
Has this situation with ConciergeKey changed your view of American Airlines?
I'm not unhappy with American. And I believe they have responded well and respectfully, and so, I've given them free, unsolicited advice. That's basically it.
Someone said to me, ‘This is a first world problem, why are you worried about this?’ I said, "I'm not worried about it. I'm just giving some advice."
I've been a ConciergeKey member, on and off, for about seven years or eight years. And I've been an American Airline flyer for 30-35 years. Overall, my view is loyalty is a two way street. That’s the best way to think about it. You want me to be loyal to you, you’ve got to be loyal to me.
I've also been fine with United’s Global Service. They've kept me in that program, so far. I was surprised that United, which I've flown two million miles in total — and I flew even less last year with them than I flew on American — has continued to keep me in Global Service.
Has this experience changed your view of flying and elite status in general?
Even though people complain, I think airline travel has gotten better. In effect, the planes have gotten better. Yes, the seats might be a little thinner. But you get many more choices. The costs are much lower. People keep imagining some amazing past that doesn't exist.
What has started to happen now is that you get what you pay for. And in the U.S., air travel has become much less expensive. It’s like what happened with traveling by train. At first, it was seen as exciting, luxurious. But then it became less exclusive and more ordinary.