To avoid economy, I tried my very best to upgrade to Premium Economy but American Airlines makes it too hard – even more difficult than economy to Business Class.
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Trying My Best To Upgrade To Premium Economy
File this under weird stuff American Airlines does to avoid marginal revenue, I could not for my life upgrade to Premium Economy this week on American Airlines. I was flying a mistake fare in, yes, Basic Economy but it turns out that had nothing to do with it. Though American’s website states clearly that award bookings and Basic Economy fares are excluded, as a Platinum Aadvantage Elite member, upgrades are, in fact, allowed.
In fact, it was easier to upgrade my wife to Business Class than it was to upgrade even one of us to four open seats on a flight to Paris. And we had eVIPs upgrade us from Paris back to New York across all passengers meaning that even Basic Economy tickets are, in fact, upgradable. 13
I first tried by calling in. We could upgrade our roundtrip (not just the one-way) for a cost of $2,000 each for my family of three. Probably not. The upgrade (if cleared) all the way to Business Class was only 25,000 miles and $350. I could not envisage a world in which even the most delusional American Airlines executive would see 25,000 miles as worth anywhere approximating $1,650 and I certainly wouldn’t pay that when I could jump ahead for less.
I asked about removing our business class mileage upgrade requests and replacing them with Premium Economy requests but agents both on the phone and at the airport believed that if I had made a request for business class but couldn’t use it, they would offer me the Premium Economy option at some discount and I would be first in line.
That proved to be false.
Sell Me Premium Economy As An Upgrade
Sell it to me at the gate, I’ll buy it. I have a business partner who swears by buying a gate upgrade to Business Class and to this point (he owns properties in Europe) he has yet to miss one or pay more than $750/seat.
It’s like a twisted Dr. Suessian nightmare:
You cannot buy Premium Economy in the lounge, you cannot buy it at the gate, you cannot use miles on the phone, you can only hope and wait.
2024 Revenue Growth Will Come From Premium, Loyalty Program
In an investor call, management expected revenue growth to come from premium market segments and the loyalty program.
Sure.
Examples, like this one are why I have such significant doubts that American can even hear what they sound like when they speak. I outlined some of this last week, and I’ll remind readers that on some routes, American has defaulted to cardboard boxes for amenity kits in business class. That doesn’t seem to me like focusing on premium customers, it seems like cutting as much cost as you possibly can which is not the same thing as premium revenue growth.
Management also stated that they expect more growth to come from the loyalty program and then made it harder to earn points outside of buying American Airlines tickets through specific channels – again – cost cutting not growth.
Here’s an opportunity to grow one of two ways with Premium Economy; either sell the unsold seats at a discount moments before that inventory dies forever, or offer it with mileage. Either way, if I really want to make sure I am in Premium Economy, I am going to buy it in the first place, but if I’m not going to pay that price upfront, American needn’t lose out on the revenue entirely. If I use my Aadvantage miles to offset some or all of the cost, then I’m certainly going to see the value and utility of collecting them. I might want to replace them by signing up for a credit card and moving more purchases to partners.
But right now, I can’t do that. And if I can, American Airlines staff doesn’t know it so how would the average traveler?
Real Risk To Price Protection
There is a real risk to protecting the price and value of long-haul Premium Economy which is slightly better than domestic First Class. If I know that I can buy the cheapest of cheap tickets, in this case $225/person, and still enter the Premium Economy cabin for let’s say $250 +15,000 miles, then surely, I am never going to pay $2000 for the perk and should plan on my small slice of hell at the back of the plane.
It’s last-minute upgrades at slashed prices that prohibit my business partner from ever buying Business Class outright, though for the right deal, I think he sees the value in not leaving it to chance.
But there’s another problem here. While it wouldn’t have changed American Airlines’ statement about growing premium segments, the airline made it harder for me to pay them $1000 and 40,000 miles (suggested upgrade price: $250 + 10,000 miles) than it was to pay them $350 and 25,000 miles for an experience that I deemed worthy of the price.
The other problem is that while I won’t be buying an economy mistake fare again (how many more times will I make this proclamation and fail?) I was a customer at $250 per person, but will never be a customer at $2,000. They will never earn that business from some flyers, either those too cheap to pay more, or those to savvy to know that some Business Class fares start in the range of $2,000-3,000 anyway.
At one point does price preservation give way to closed sales? That is to say, can you so closely guard your price that you walk away from willing customers? They had four customers willing to pay. But the relative difficulty vs the ease and luck of a Business Class upgrade (along with the value for money) kept us out of that section of the plane.
Conclusion
As American Airlines focuses more on premium revenue and loyalty markets for growth, it needs to consider how hard their own process and systems make it to achieve those goals. For a customer willing to pay for the upgrade, money in hand, the airline should find the right way to take that money especially as an equal amount of seats go out empty.
What do you think?
