A Marketing Campaign So Successful It Bankrupted An Airline

A Marketing Campaign So Successful It Bankrupted An Airline

In the digital marketing space, it is essential to know what success looks like for each campaign that a business runs, as diverse marketing methods convert people into customers in different ways.

As well as this, it is also important to be ready for success, particularly if a business makes offers and promises to early adopters and customers that rely on certain types of behaviour in order to draw in customers, with Temu a recent example of the lengths companies will go to build a customer base.

However, one of the most infamous examples of a marketing campaign so successful it ultimately backfired is found with the AAirpass, a frequent flyer discount programme that was so popular it led to the bankruptcy of the world’s biggest airline.

The AAirpass was a lifelong membership that offered unlimited flights on American Airlines, as well as access to the Admirals Club, a chain of first-class airport lounges operated by AA.

All of this initially cost $250,000, with the option of an additional $150,000 companion pass. This was immensely expensive and designed as a form of prestige marketing; the idea was that few people would use it or take advantage of it, but it would show AA’s commitment to passengers.

The problem was that $250,000 (roughly £720,000) to fly forever in first class was astonishingly low. In 2024 prices it would take just 70 transatlantic flights to recoup that investment, and for frequent fliers that could be done in less than a year.

One AAirpass holder, Mike Joyce, flew from London to Chicago 16 times in 25 days, all for free.

They tried several methods to avoid this issue, first by increasing the prices and then by terminating particularly frequent users of the pass, most notably Steven Rothstein and Jacques Vroom Jr., on the grounds of “fraudulent behaviour”.

This led to lawsuits, but after AA filed for bankruptcy in 2011 these cases were settled, but this highlights how a marketing campaign can have long-reaching ramifications even decades after its launch.