American’s Chief Customer Officer Shares Vision: I’m Excited & Sad

As anyone who has been following the industry knows, American has been lagging Delta and United when it comes to both customer experience and profitability. Essentially, executives at the airline lacked a vision for far too long. Or perhaps more accurately, they had the wrong vision — they believed that the key to profitability was to just deliver a reliable and robust schedule (not that they were ever particularly good at that).

In recent months, we’ve seen a vibe shift. American appointed Heather Garboden as Chief Customer Officer, and we’ve seen the airline announce it wants to become more premium and customer focused. We’ve started to see some positive changes, and that’s great. So here’s an interesting update, along those lines.

Interesting interview with American’s Heather Garboden

American has the “Tell Me Why” podcast, which is essentially a podcast about the airline, intended largely for employees (though it’s also shared publicly). The airline has just published the latest of these episodes, and it features American Chief Communications Officer Ron DeFeo having a conversation with American Chief Customer Officer Heather Garboden.

As flagged by View from the Wing, there’s some interesting commentary here, which customers should be happy to hear. Specifically, she fully acknowledges that running an on-time operation simply isn’t enough anymore, and that customer experience matters:

“I’ve been in this business for 20+ years, and for most of that time, I think customer experience was really defined as running a reliable operation and getting you to your destination on-time and with your bags. And of course that’s by far the most important. But in today’s environment, that’s table stakes.”

“We know that customers expect more, we know that premium has become incredibly important, even in today’s uncertain economic environment, premium demand has remained solid. And we also know who is flying us now. We have a lot more younger generations flying us than we used to. More than 55% of our customers are millennials or younger, and the younger generation enjoys experiences and values them more, and is willing to pay for them.”

She then hints at some big announcement coming in summer, reflecting the company’s renewed focus on customer experience. It remains to be seen what that entails, but it seems that American is finally trying to come up with a bigger vision for delivering an improved customer experience, so that employees can be aligned with that vision.

This is all very encouraging, but also quite sad

I’ve never met (or interacted with) Garboden, but I’m really encouraged by everything that she’s saying. She seems like she “gets it,” and I think under her leadership, the customer experience will go in the right direction. The American customer experience isn’t going to radically change overnight. We’ve already started to see a countless number of little improvements, and that’s all a step in the right direction.

Also, let me say that years ago I met with some of the people in charge of American’s customer experience, and some of the interactions were downright puzzling. They just didn’t get it. They thought everything about American was great, and that people loved the airline. Garboden seems much more perceptive of reality, so I’m happy to see her in this role.

While I’m encouraged by all of this, I also can’t help but be sad. For many years now, American has been pushing itself further and further into the third spot among the “big three” carriers, when it comes to service, route network, profitability, customer experience, etc.

The amount of ground that American has to make up to again be competitive with Delta or United is frightening. Worst of all, American executives are tasked with these changes while we have economic uncertainty, the airline has tens of billions of dollars in debt, and the competition is improving as well.

As someone who lives in Miami, I want American to succeed, because flying American is the easiest option. I also have a lot of history with the airline. But the task of making American more competitive almost seems unsurmountable.

The challenge is that American doesn’t just have to make up ground when it comes to its customer experience, but it has also lost market share in some important markets, like Chicago. Dominating Charlotte and Dallas is great, but that will only get you so far…

Bottom line

American’s new Chief Customer Officer seems to “get it,” which is great. She understands that running a reliable operation is just “table stakes,” and that customers want a good experience. We’ve already seen some positive changes in the short time she has been in her role, and it sounds like we should expect a bigger announcement in the near future.

Of course it goes without saying that American is in a tough position. The airline lags the competition with profitability, has a massive amount of debt, and has lost market share in important cities. Is it too late, or can American get back into the league of Delta and United? After all, it sort of is a zero sum game…

What do you make of these comments from American’s new Chief Customer Officer?