There has been a lot of customer experience news in the past several weeks, and The Experience Maker is here to dissect it all for you.
Whenever the airlines make changes to their services or loyalty programs, it’s time to take out the magnifying glass to analyze the fine print.
American Airlines announced last month a slew of changes under the guise of making “travel even better” for fliers, but a closer look shows they are mostly money makers for the airline.
In a blog post with the headline “Booking directly with American Airlines and its airline partners makes travel even better for AAdvantage® members,” American announced that:
I’ve written previously about price vs. value and that brands should add benefits when they raise prices in order to avoid losing customers.
American’s announcement contains a lot of language that sounds like added benefits, but the reality is far less beneficial.
The chart below shows all of the changes, and a close inspection reveals that most of the “benefit” comes from baggage that is just a few pounds overweight or a few inches oversized – or from massively oversized items. In other words, most passengers will just end up paying more.
Remember, prior to 2008, there was no such thing as baggage fees at all. As of 2022, the latest year for which data is available, the airline industry brings in a whopping $6.8 billion in baggage fees, according to CNN.
The direct booking requirement isn’t so bad; the hotel industry has had similar policies for a long time. It remains to be seen how this will affect travel aggregators such as Orbitz, Expedia, and Travelocity.
Still missing? The change I thought for sure American would want to make. Currently, flights booked on one of American’s co-branded credit cards earn one bonus mile per dollar but no extra Loyalty Points.
Isn’t the purchase of an American Airlines flight the very definition of loyalty?
Also last month, credit card issuer Capital One announced that it was acquiring my former employer, Discover Card, in a transaction valued at $35.3 billion.
The press release bragged that the deal “generates $2.7 billion in pre-tax synergies and >15% accretive to adjusted non-GAAP EPS in 2027.” Translated into English, that’s probably not a good deal for consumers.
Discover is a multi-time winner of the J.D. Power Award for Customer Satisfaction as an issuer – the first one coming while I led the digital customer experience team. (One of Capital One’s rewards cards also ranked highest in customer satisfaction among bank rewards credit cards with no annual fee last year.)
One of Discover’s biggest claims to fame has been that they are the only American credit card company to boast 100% U.S.-based customer service.
I wonder what the over/under is in Las Vegas for those customer service agents moving overseas as part of those “pre-tax synergies”?
Consumers may see better rewards from their Discover Cards with the combined company’s size and assets (Discover knew better than to compete on price – rewards and interest rate in the credit card world – given that it was much smaller than it’s competitors).
Businesses that accept credit cards are more likely to benefit from the transaction though, as Discover also runs its own merchant network that competes against Visa and Mastercard. With Capital One potentially owning the network and moving a lot of its transactions to it, prices could come down for merchants as competition for swipes increases.
But will those businesses pass on any of the savings to consumers? Only time will tell.
Sam’s Club, the warehouse club owned by Walmart, recently announced two changes that appear fully dedicated to enhancing the customer experience.
“In the ever-changing, fast-paced, and competitive world of retail, there are a lot of ways to be a leader – most club locations, largest revenue, highest traffic,” said Todd Garner, Interim Chief Product Officer. “At Sam’s Club, our primary focus is on creating the best shopping experience possible for our members.”
Anyone who has checked out of a warehouse club knows the drill: Wait in another line to exit the store, but not before showing your receipt to an associate to confirm you’re not trying to steal anything. It’s been a sad but likely necessary reality for many years, and Sam’s Club seems to have solved it with technology.
As Garner describes, this is “a first-of-its-kind exit technology that uses computer vision and digital technology to make the verification of receipts and exit process a breeze. Shopping cart images are captured by cameras and, using A.I. in the background, payments are seamlessly verified – eliminating the wait at the exit while also enabling member specialists to engage with members.”
A faster exit, eliminating that feeling of distrust, and more engagement from employees – sounds like a win-win-win for customers.
And in the spirit of allowing customers to have their cake and eat it too, Sam’s Club also announced a new digital ordering process for its popular party desserts.
“When members told us that the manual process for ordering cakes was a hassle, we took note,” according to the announcement.
Related: Why Are Brands Not Listening To Their Customers?
With the streamlined digital ordering process, “now members can customize their cake, add to cart, schedule their cake pickup and shop for other groceries and supplies in a single transaction. Cake ordering has never been easier.”
The best thing about Sam’s Club’s customer experience news? There is no fine print, no price increase, no reduction in benefits – it is entirely about improving the customer experience.
If only more brands would pay attention.
Dan Gingiss is a customer experience keynote speaker who helps unlock your team’s potential by fostering a culture of remarkable experiences.