American, Marriott Split Devalues Both Programs

In the world of travel rewards programs, partners come and partners go.

As a top-of-the-news example, Continental was buddy-buddy with Delta until late last year, offering reciprocal frequent flyer benefits and co-participating in the SkyTeam global airline alliance.

Today, Continental is a member of a competing alliance, the Star Alliance, and is in the process of merging with United.

While that represents a shift of monumental proportions, it’s not a surprising development, given the history and business trajectories of the airlines involved.

For a surprising change, consider the following email message sent on April 30 to members of American’s AAdvantage program:

We would like to provide you with an important update to the American Airlines AAdvantage program. Effective July 1, 2010, the Marriott Rewards program will no longer offer AAdvantage miles for stays at Marriott hotels.

All qualifying stays at participating properties completed by June 30, 2010, will be eligible to earn AAdvantage miles. It is also important to note the final date to convert your Marriott Rewards points to AAdvantage miles will be June 30, 2010.

The loyalty programs of American and Marriott are two of the industry’s oldest and most popular. They’ve been linked since the earliest days of travel rewards programs.

And that relationship is part of what makes both programs valuable for their members.

It follows that severing that tie will have an adverse effect on the value of many program members’ miles and points. At a minimum, they are owed an explanation, not just an apology.

With that in mind, I sent the following query to both American and Marriott:

Would it be possible to get the real story behind the upcoming American-Marriott loyalty program break-up?

This is a serious blow to many of your customers, and they deserve better than the generic responses they’ve been getting through normal customer service channels of communication.

Predictably, the real story was not forthcoming. American responded as follows:

It was a decision Marriott made not to renew its partnership. As you know, some partners join the AAdvantage program and some decide that it is time to part ways.

My best guess is that Marriott is unwilling to pay what American felt was a fair price for its AAdvantage miles. But had American upped its prices? Was Marriott simply unwilling to extend the agreement at the old prices? Does this portend other airline-hotel break-ups? All we can do is speculate.

Whatever the back story, this is a lose-lose-lose situation. Two good programs will be worse for the change. And their customers’ best interests have been kicked to the curb.

You’ve heard of marriage refs? What’s needed here is a loyalty program ref, to keep both sides at the negotiating table until their differences are resolved.

In the meantime, the two companies could work together to provide their loyal customers with a real explanation of their current difficulties. Who knows, it might be the beginning of a great relationship.