American Airlines Chief Operating Officer David Seymour and Chief Customer Officer Heather Garboden did the opening panel at Skift‘s aviation forum Wednesday morning in Fort Worth. Seymour talked about the airline’s operations, and the government shutdown, while Garboden talked about the airline’s efforts to lead in premium products.
One piece of news that Garboden shared publicly for the first time is that the airline will announce next week that mattress pads coming to all long haul business class flights, after adding them to longer distance ones this summer. This is actually news that I broke in late October.
Garboden suggests thta “even before Covid, we saw a younger generation being a demographic of our customer base and they’re willing to pay more for…differentiated experiences.” Delta targets the shift in customer preferences to ten years ago.
And this points to the fundamental challenge American faces, and why they are behind. In 2018, then-President and now CEO Robert Isom was laying out a vision for the airline that they competed primarily with Spirit and Frontier, and that what passengers were interested in was just the lowest fare. In other words, they got the trends wrong and what customers wanted wrong.
Nonetheless, she argues that American has the best or at least truly competitive premium product. She says “if you look at our premium long haul experience, we have an unbelieveable product” that is “..as good or better than our peers.”
- On seats I agree with this!
- About half of Delta’s fleet has 2013 or earlier seats in business, with their 767 product worse than any other major carrier across the Atlantic.
- While American has many different seat products, I find their worst one to be better than United’s.
- And United’s Polaris seats are about density, not quality. Approved by disgraced CEO Jeff Smisek, the project was about achieving lie flat aisle access without giving each seat more aircraft space than when the configuration was 2-2-2 with a basic Diamond seat.
She’s on shakier ground talking about premium lounges. “We have more premium lounges than any other airline in the united states. We started the premium lounges and we’re only look to expand them.” Flagship lounges aren’t as nice as Polaris lounges which aren’t as nice as Delta One lounges. The design of Philadelphia Flagship is nice (which is why I’m glad that they delayed the lounge several years), but the food program lags.
Flagship Lounge Philadelphia
Flagship Lounge Philadelphia
American will be making a “steady stream of exciting lounge announcements over the next year” and will be “focused on partnering with regional chefs and restaurants” the à la carte ordering they introduced in the Philadelphia Flagship lounge (and everyone forgets that the Soho lounge at JFK has this, and it came first there) will “expand to our other flagship lounges as well.” So at some point we’ll see it coming elsewhere – great, because the food game isn’t nearly so good at DFW or Miami or Los Angeles.
Soho Lounge New York JFK
This all matters because Garboden says that one point of net promoter score improvement yields $50 million to $100 million in revenue. While she notes that they’re focused beyond just premium customers, to all customers with more buy on board food and free wifi starting next month, she does not mention service or the experience provided by American’s front line team. That’s a problem for the airline that needs intensive focus.
David Seymour was asked about American’s lagging international route network and why their domestic strategy hasn’t worked. He did not push back, instead arguing that American has fewer long haul aircraft than competitors, partly because of delivery delays from manufacturers, though he also recognizes that it’s because they retired their Airbus A330, Boeing 767 and 767 fleets during the pandemic but argues that’s a good thing (it was a mistake). I’d point out that it’s not just American being a victim of suppliers, and that American should own that they bet wrong on the timing of these suppliers. American has cut orders for long haul aircraft from both Boeing and Airbus.