Whoa: American AAdvantage Unveils Loyalty Factors

Warning upfront — be sure to’re sitting down, as a result of that is large. American AAdvantage has utterly reimagined how elite standing is earned. Say goodbye to elite qualifying miles and elite qualifying {dollars}.

As a substitute incomes AAdvantage elite standing will probably be considerably simplified, and gained’t simply account for a way a lot you fly with American, but additionally how a lot you have interaction with American’s companions. Now you can earn prime tier standing completely by bank card spending, in the event you needed to.

I’m nonetheless making an attempt to determine what precisely to make of those adjustments, as a result of that is simply such a radical departure from what we’re used to. Let me share the small print, after which I’m curious to listen to what OMAAT readers suppose.

Earn American AAdvantage elite standing with Loyalty Factors

Beginning in 2022, American AAdvantage elite standing will probably be based mostly completely on what number of Loyalty Factors you earn. Each qualifying AAdvantage mile earned will earn you one Loyalty Level. For 2022, AAdvantage elite standing necessities will probably be as follows:

  • AAdvantage Gold standing would require 30,000 Loyalty Factors
  • AAdvantage Platinum standing would require 75,000 Loyalty Factors
  • AAdvantage Platinum Professional standing would require 125,000 Loyalty Factors
  • AAdvantage Govt Platinum standing would require 200,000 Loyalty Factors

Notice that with this new program, standing will probably be earned between March and February of a given 12 months, and can then be legitimate by March 31 of the next 12 months. Which means standing is not based mostly on the standard calendar 12 months.

In fact the most important query is what miles qualify as Loyalty Factors. Sure, spending $200,000 on a bank card would earn you Govt Platinum standing, however shopping for 200,000 AAdvantage miles wouldn’t earn you Govt Platinum standing. So let’s go over these particulars.

How one can earn Loyalty Factors for flying

You possibly can earn Loyalty Factors for flying American Airways or a associate airline. If flying American Airways:

  • You earn 5x base miles per greenback spent
  • Elite standing bonuses additionally rely as Loyalty Factors, and people bonuses vary from 40-120%; for instance, as an Govt Platinum member you’d earn 11x miles per greenback spent, and all of these would qualify as Loyalty Factors
  • American fundamental economic system tickets are eligible to earn Loyalty Factors

When flying associate airways, together with oneworld companions and JetBlue:

  • You earn redeemable miles on the similar fee as earlier than, besides these miles would additionally qualify as Loyalty Factors
  • Elite standing bonuses additionally qualify in direction of Loyalty Factors on associate airways, and people vary from 40-120%
  • Cabin bonuses (the place you earn miles for flying premium economic system, enterprise class, or firstclass) additionally qualify in direction of Loyalty Factors
  • Simply to provide an instance, say you’re an Govt Platinum member reserving an “I” class ticket on Alaska Airways (it is a discounted firstclass fare bucket, and you’ll find the earnings chart right here) on a 1,000 mile flight; you’d earn a complete of two,700 Loyalty Factors (1,000 base Loyalty Factors, plus a 50% cabin bonus, plus a 120% elite standing bonus)
You possibly can earn Loyalty Factors for journey on associate airways

How one can earn Loyalty Factors for bank card spending

Most AAdvantage bank cards issued by Barclays and Citi earn Loyalty Factors:

  • You earn one Loyalty Level for each base mile earned on the cardboard, which might typically be the speed of 1 Loyalty Level per greenback spent
  • Welcome bonuses don’t rely as Loyalty Factors
  • In case you’re spending in a class that’s bonused, you solely earn Loyalty Factors for the “base” spending, which means one Loyalty Level for each greenback spent; in different phrases, if a card provides two AAdvantage miles per greenback spent on American Airways flight purchases, you’d nonetheless solely earn one Loyalty Level
You possibly can earn American standing by bank card spending

How one can earn Loyalty Factors for different associate exercise

So far as non-flying actions go, there are another companions past bank cards that mean you can earn qualifying Loyalty Factors. Particularly, all base miles earned from spending with AAdvantage Eating, AAdvantage eShopping, and SimplyMiles rely in direction of Loyalty Factors.

Notice that choices with some companions are apparently nonetheless being labored out. For instance, I requested about Bask Financial institution, and was instructed “keep tuned,” so we’ll see if that qualifies.

You possibly can earn Loyalty Factors for eating out

What exercise doesn’t earn Loyalty Factors?

There are a number of forms of exercise that don’t earn Loyalty Factors, inclduing:

  • Shopping for, gifting, or transferring miles
  • Authorities taxes, charges, and different prices related to shopping for airline tickets
  • Conversion of one other program foreign money to AAdvantage miles (for instance, changing Marriott Bonvoy factors or Citi ThankYou factors)
  • For AAdvantage bank cards, welcome bonuses don’t qualify, and neither do “accelerators” or “multipliers” (like additional miles for every greenback spent in sure classes)

On the one hand I’m not stunned that purchasing miles doesn’t rely in direction of Loyalty Factors. However, I additionally don’t comply with the logic of that, as a result of presumably when American sells miles on to shoppers, it’s larger margin than when promoting miles in bulk to a associate. I assume the logic is simply that American thinks that this could be too simple of a strategy to earn standing.

Shopping for miles doesn’t rely in direction of Loyalty Factors

American AAdvantage Loyalty Alternative Rewards

In 2020 American Airways revealed the idea of Elite Alternative Rewards. Moderately than simply giving Govt Platinum members 4 systemwide upgrades per 12 months, the thought is that each Platinum Professional and Govt Platinum members can select the rewards they worth most. That can proceed with the brand new program, with a slight change.

American AAdvantage will introduce Loyalty Alternative Rewards, whereby Platinum Professional and Govt Platinum members can proceed to decide on rewards when incomes Platinum Professional and Govt Platinum standing. There’s one main catch, although. So as to have the ability to earn Loyalty Alternative Rewards, you’ll have to log 30 segments on American or a qualifying associate airline throughout your membership 12 months.

In different phrases, it is a strategy to keep away from giving these perks to individuals who don’t truly fly American steadily. There will probably be Loyalty Alternative Rewards perks on the following tiers:

  • Stage 1 — 125,000 Loyalty Factors
  • Stage 2 — 200,000 Loyalty Factors
  • Stage 3 — 350,000 Loyalty Factors
  • Stage 4 — 550,000 Loyalty Factors
  • Stage 5 — 750,000 Loyalty Factors

Platinum Professional Loyalty Alternative Rewards

When incomes 125,000 Loyalty Factors plus finishing 30 qualifying segments, Platinum Professional members will be capable of choose one of many following:

  • One systemwide improve
  • 20,000 AAdvantage bonus miles (25,000 AAdvantage bonus miles you probably have an AAdvantage co-brand bank card)
  • One-time 15% AAdvantage award financial savings (applies to a roundtrip award for as much as two vacationers on any oneworld airline in any cabin, and the rebate will probably be utilized after journey)
  • $200 American Airways journey voucher
  • Six Admirals Membership one-day passes
  • Carbon emissions offset
  • $200 donation to one among 10 associate charities
Choose a systemwide improve as a Loyalty Alternative Reward

Govt Platinum Loyalty Alternative Rewards

When incomes 200,000 Loyalty Factors plus finishing 30 qualifying segments, Govt Platinum members will be capable of choose two of the next:

  • Two systemwide upgrades
  • 25,000 AAdvantage bonus miles (30,000 AAdvantage bonus miles you probably have an AAdvantage co-brand bank card)
  • Present of AAdvantage Gold standing
  • Admirals Membership membership (this requires two decisions)
  • Alternative of Bang & Olufsen merchandise (this contains headphones, audio system, and earbuds)
  • Carbon emissions offset
  • $200 donation to one among 10 associate charities
  • $200 American Airways journey voucher

Rewards will probably be related for larger thresholds as effectively, although it’s said that we should always count on some new advantages going ahead as effectively.

Choose bonus miles as a Loyalty Alternative Reward

Loyalty Factors will decide improve precedence

This shouldn’t come as a significant shock, however with the brand new program your rolling 12-month Loyalty Factors complete will decide your improve precedence inside your elite rank.

At the moment upgrades are prioritized first by elite tier, after which by your rolling 12-month elite qualifying {dollars} (EQDs) complete. It is sensible that with the brand new program Loyalty Factors would be the tiebreaker.

Upgrades will probably be prioritized based mostly on Loyalty Factors

American AAdvantage extending standing, double-dipping alternative

American AAdvantage has already made standing considerably simpler to earn in 2021, and now there’s one more new alternative:

  • American is extending all AAdvantage elite standing by March 31, 2022
  • All elite qualifying exercise in January and February of 2022 will rely in direction of each 2022 and 2023 AAdvantage standing qualification

In case you’re making an attempt to resolve whether or not to do a mileage run to earn standing, it could possibly be extremely advantageous to do it within the first two months of 2022, somewhat than on the finish of 2021. You’ll have 14 months to earn this 12 months’s standing, and in addition 14 months to earn subsequent 12 months’s standing, and that journey would rely in direction of each years.

Journey within the first two months of 2022 will rely in direction of two years

In concept I like these AAdvantage adjustments

In concept I believe these program adjustments are nice. Lately airline loyalty applications have turn out to be too transactional and sophisticated, and have missed out on the large image. The idea behind these program adjustments are sensible — members could be rewarded for his or her general loyalty to AAdvantage, somewhat than simply how a lot they fly.

On condition that effectively over half of airline miles these days are earned by non-flying means, it is sensible to reward folks for that as effectively. It’s completely logical to reward somebody not only for how a lot they fly with American, but additionally for a way a lot they use an American Airways bank card, dine by the AAdvantage Eating program, and so forth.

In fact the idea is one factor, however how is that this in actuality?

Crunching the numbers on AAdvantage Loyalty Factors

To be sincere, I’m nonetheless making an attempt to do the maths on Loyalty Factors, and I’m unsure whether or not to suppose that that is completely affordable, or suppose the thresholds are a bit excessive. For context:

  • Govt Platinum standing used to require 100,000 elite qualifying miles and 15,000 elite qualifying {dollars}
  • In 2021, Govt Platinum standing requires 80,000 elite qualifying miles and 12,000 elite qualifying {dollars}
  • In 2022, Govt Platinum standing would require 200,000 Loyalty Factors

With that in thoughts, a number of ideas on the maths right here:

  • In case you’re incomes 11x Loyalty Factors per greenback spent on American flights, you’d need to spend ~$18,200 per 12 months on flights to earn Govt Platinum, which is a major improve
  • Apparently Govt Platinum standing is even tougher to earn in the event you’re ranging from scratch, because you don’t earn the identical 120% mileage bonus from the beginning; by my math, you’d need to spend over $27,000 on flights to get to Govt Platinum standing from scratch
  • On the opposite finish of the spectrum, spending $200,000 per 12 months on a co-branded bank card would additionally earn you Govt Platinum standing, although you’d solely obtain the Loyalty Alternative Advantages in the event you flew at the least 30 segments
  • To take a hybrid method, in the event you’re an Govt Platinum member you might spend $100,000 per 12 months on a co-branded bank card and spend ~$9,100 per 12 months on flights to take care of Govt Platinum standing
  • Bask Financial institution provides AAdvantage miles in lieu of curiosity when saving cash, and also you earn one AAdvantage mile for each greenback saved over the course of a 12 months, so having $200,000 deposited would earn you 200,000 AAdvantage miles; nevertheless, it hasn’t but been introduced if miles earned with Bask Financial institution will qualify

I’m curious to listen to what OMAAT readers consider the brand new necessities. I believe that that is a type of issues the place qualifying is perhaps simpler than we count on as soon as we put our heads collectively and work out a number of the extra profitable alternatives on the market.

You possibly can take a hybrid method to incomes AAdvantage standing

There’s no AAdvantage award chart devaluation, yay!

For some time there had been widespread rumors of a giant AAdvantage devaluation. Many assumed that this meant that American would devalue its associate award charts, since no main adjustments have been made to these for the previous 5 years.

The excellent news is that nothing is altering with regards to associate award charts, and for that matter there aren’t any imminent plans to vary associate award pricing. I’m positive this will probably be an enormous aid to many.

AAdvantage isn’t devaluing associate awards

Backside line

American AAdvantage is totally altering how elite standing is earned. Beginning in 2022, you’ll earn elite standing completely based mostly on what number of Loyalty Factors you earn, somewhat than based mostly on some other metrics. Loyalty Factors could be earned by flying, bank card spending, and even incomes miles with different AAdvantage companions.

I’m a fan of the idea behind these adjustments. The brand new Loyalty Factors idea simplifies incomes elite standing, and does a greater job of contemplating a member’s general engagement in a loyalty program, past flying.

Nonetheless, at first look the Loyalty Factors thresholds appear excessive. Then once more, I assume in the event you can earn standing based mostly on a mix of bank card spending, on-line procuring, eating, and flying, qualifying may not be as difficult because it appears at first look.

What do you make of the brand new AAdvantage program?

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