AOL, American launch loyalty program

By Alan Goldstein / The Dallas Morning News <br><br>Members of American Airlines' AAdvantage program who have no need for a free trip now can redeem their miles for a reversible power drill, a coffee

Tuesday, October 3rd 2000, 12:00 am

By: News On 6

By Alan Goldstein / The Dallas Morning News

Members of American Airlines' AAdvantage program who have no need for a free trip now can redeem their miles for a reversible power drill, a coffee maker with a built-in grinder or a portable digital music player.

On Monday, the Fort Worth-based carrier and America Online Inc. unveiled their customer loyalty program, called AOL AAdvantage, which lets customers use their computers to both earn and redeem miles. Frequent-flier miles now serve as currency for a host of products, in addition to free travel. The AOL AAdvantage program has been in development since January, when the alliance was announced.

The program is available to any AAdvantage member through a new Web site, www.aolaadvantage.com. Customers of America Online will be eligible for additional benefits, including opportunities to accrue more miles.

Executives for both companies said the AOL AAdvantage program offers consumers more flexibility.

For many of the most frequent fliers, additional travel isn't necessarily desirable, said Dennis Gonier, a senior vice president for America Online, based in Dulles, Va., and chief executive of the company's Digital Marketing Services unit in Lewisville.

So instead of using 25,000 miles for a round-trip ticket in the United States, a customer might instead choose to redeem 27,250 miles for a Diamond Rio MP3 player.

Those with considerably more miles might consider a Palm VII wireless hand-held organizer for 78,500 miles or a Sony Mavica digital camera for 79,000 miles. By way of comparison, a coach-class roundtrip ticket to Japan is available for as little as 50,000 miles during the off-season and with sufficient advance booking.

There's no "absolute formula" for determining how many miles are needed for a specific reward, said Bruce Chemel, president of the AAdvantage program. "Not every award is for everyone," he said.

The AAdvantage program, created in 1981, has 40 million members, making it by far the world's largest customer loyalty program.

"What's a free ticket worth? It depends on where you're traveling," Mr. Gonier said.

AAdvantage members who travel infrequently but want to build credits toward their dream vacations may choose to accrue miles by shopping online. The Sharper Image, a retailer of high-end gadgetry, is offering AOL AAdvantage members triple miles for every dollar they spend at its Web business, sharperimage.com. As an added bonus, AOL customers in the program earn quadruple miles.