American Airlines has stirred up a debate with the announcement of changes to its loyalty point program, affecting how travelers earn Aadvantage Miles. Starting in May 2024, only customers who book through select American Airlines travel agents or directly on the airline's website will be eligible to earn miles and Loyalty Points towards status accrual.

The move is seen as an attempt by American Airlines to streamline its sales process, push travelers towards booking directly, and reduce costs associated with third-party sellers. However, the decision has raised concerns among online travel agencies (OTAs), particularly Expedia, which could potentially be impacted by the new policy.

American Airlines management revealed that a significant percentage (83%) of its customers are one-time per year purchasers, with many of them booking through third-party OTAs. This shift in the loyalty program aims to incentivize travelers to book directly with the airline, facilitating upselling and encouraging customers to opt for ancillary products and higher service classes.

The lack of clarity around which American Airlines approved travel agencies will continue to earn Aadvantage miles has left key details undisclosed, with further information expected in April. While the airline seeks to enhance its revenue model and loyalty program, critics argue that excluding a large portion of customers who use third-party platforms may not achieve the desired outcomes.

OTAs have the potential to respond to these changes by altering the way American Airlines fares are presented to customers, emphasizing the lack of earned miles on such bookings. This could prompt travelers to consider alternative airlines that offer loyalty points through OTAs, impacting American Airlines' market share and revenue stream.

As the industry reacts to these developments, the implications of the Loyalty Point changes by American Airlines could have broader implications on customer booking behavior, airline competition, and the distribution of travel services. The airline's strategic shift towards direct bookings may pose challenges for OTAs while reshaping the dynamics of the airline-travel agency relationship.