In a notable shift poised to redefine the travel booking landscape for countless flyers, American Airlines has announced significant updates that will impact how AAdvantage loyalty program members earn miles, manage baggage fees, and utilize trip credits. This move is not just about altering the logistics of flying; it's a strategic endeavor to encourage direct booking and enhance the relationship between the airline and its passengers. Let's dive into the details and understand what these changes entail, especially for corporate travel management teams, and how there's still a window of opportunity to adapt seamlessly to these changes before they come into effect on May 1, 2024.
AAdvantage Loyalty Program Adjustments
Starting May 1, American Airlines will adjust how AAdvantage loyalty program members earn miles. Except for AAdvantage Business members or those booking through one of American’s corporate contracts, loyalty points or miles will no longer be accrued for flights booked through channels outside of AA.com, its partners, or "preferred" travel agencies. The aim here, as outlined by Scott Chandler, American’s SVP of revenue management and loyalty, is to streamline the booking process and reward those booking directly or through preferred channels.
The criterion for agencies to gain "preferred" status is straightforward: as of April 21, they must book at least 30% of their American Airlines volume through New Distribution Capability (NDC)-enabled channels. This move is not merely about restricting booking avenues but is designed as an incentive for travel agencies to adopt advanced technology for better transparency and customer service.
Why Deploying Traxo is Mission-Critical
An appealing aspect of business travel for many employees is the opportunity to earn miles and loyalty status when traveling for business. Loyalty points earned during business travel pay for personal getaways and family vacations as well as enable employees to earn higher levels of status. When travel policies inadvertently obstruct this perk, many employees will be inclined to book their flights outside the established program to ensure they continue accruing miles, which is American Airlines desired outcome. Direct booking behavior underscores a significant challenge for Travel Management Companies (TMCs) and traditional travel management tools, which are designed to provide visibility and oversight over travel bookings.
Direct bookings made through suppliers, such as airlines or hotels, become "invisible" to these management systems, often until well after the trips have occurred.
This lack of travel data visibility:
- Complicates duty of care and travel risk management (ensuring companies can locate and assist their employees in case of an emergency).
- Muddles expense management and budgeting processes.
- Prevents travel managers from gaining insights into employee booking preferences, hindering the ability to negotiate better deals or tailor travel policies to meet their needs.
The disconnect between employee’s actual travel habits and corporate travel policies presents a critical gap, potentially limiting travel management’s oversight on employee travel bookings. However, there's a silver lining in the form of Traxo, a solution that can bridge this gap effectively.
Travel management teams are encouraged to deploy Traxo before the May 1 deadline to retain comprehensive visibility into their employees' travel bookings. By integrating Traxo, companies can ensure their travel booking processes align with American Airlines' new policies without losing the ability to manage corporate travel expenditure and compliance before trips occur.
Looking Toward a Future with Complete Data
American Airlines’ updates serve as a reminder of the ever-evolving nature of the travel industry, pushing companies and travelers alike toward more direct and technologically advanced booking solutions. While the changes may require adjustments from corporate travel management teams, there is a clear path forward through the adoption of tools like Traxo.
As we approach the May 1 deadline, all stakeholders must understand the gravity of American Airline’s changes and the influence it will have on employee booking behavior. By embracing these changes and leveraging Traxo, companies can ensure a smooth transition and while employees continue to enjoy the benefits of American Airlines' AAdvantage program and other amenities.
The time to act is now, ensuring readiness for a future where direct engagement with airlines becomes the norm. Contact us today to learn more about capturing details on all employee travel bookings — regardless of how they book travel.
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