notquiteaff

I think Amex lounges might have a different “optimal occupancy” point than restaurants and even priority pass lounges. Those businesses get paid for every person walking through the door, so filling every seat is presumably maximizing revenue. And making it somewhat unpleasant of an experience so people don’t hang around too long might also be part of the maximization strategy. With Amex lounges, they get paid differently. I would enjoy my stay more (and thus perhaps more likely renew my card) if I had a choice of seats and didn’t have to stand in line at the bar or wait for the buffet to be refilled. Something even remotely resembling a calm oasis would be worth something to me.

That said, I am sure Amex has plenty of smart people who get paid to think through this.

scubadu

Which doesn't really have much to do with the topic of this thread; crowded lounges.

If they raise the fee but add more "coupons" that people like and can obtain value from, nothing changes in terms of lounge crowding.

Regards

scubadu

I don't disagree with you, per se, but the problem is that Amex does get paid by people not canceling their card. So if even more people are turned away in order to create that "oasis of calm" for you (and for me), and they in turn decide to cancel/not renew their card, that does become a problem for Amex in the long run.

Honestly, I'm really not sure there is a way out of this for any of them (i.e. Amex/Chase/Capital One). As I said, they made a decision, conscious or unconscious, to change the fundamentals of their business model and become much more mass market vs. premium market and as a result their businesses have sky rocketed (in terms of adding new cardholders, etc.). They are now addicted to that new revenue stream and its unlikely any of them can turn their back on it now.

Regards

dayone

I'm afraid that ship has sailed.

SPN Lifer

I would think Schwab cardholders are a small percentage of the AmEx Platinum membership crowds.

SP03

But clearly people are not cancelling their cards in mass as a result of lounge crowding. You still have your card even though you have not been in a CL in over 1.5 years.

As a regular, though not necessarily frequent, traveler, I've haven't had much difficulty getting into a lounge. And frankly the CL is the only reason I'm keeping my Amex. Once the Chase lounge arrives at PHL, I may reassess.

scubadu

Sigh... this is like yelling in the wind.

So, take out the Schwab appreciation bonus and recalculate the net effective annual fee (oh, and add in a few of the other credits I left off, Saks, CLEAR, etc). I leave that exercise to you (hint: the math is still in your favor )

Regards

SPN Lifer

Obviously, the "anybody with a pulse" language is hyperbole for "AmEx has too many cardholders." The "more complex" argument is that the AmEx Platinum delivers such valuable benefits that cardholders do not cancel notwithstanding difficulties with Centurion Lounge access.

Essentially, the two arguments are the same: too many AmEx Platinum cardholders. Basic supply and demand.

scubadu

[Moderator edit]

That said, Amex may not believe they have "too many cardholders."

Regards

SPN Lifer

Indeed, the goal of AmEx is to maximize revenue.

Adelphos

Almost all of the complaints about the Amex Platinum end with people (mostly on blogs and forums) suggesting some combination of

1) Raise the annual fee
2) Remove the "lifestyle" "coupon-book" credits and return the card to a "travel card" like it allegedly was in the past
3) If possible, add back other "travel" benefits that were lost, improve stuff like concierge service, etc

It's hard to run into a product where some customers are encouraging the business to increase prices and reduce benefits, but I guess I understand where some customers would hope Amex would focus on other stuff. But remember that Amex lost access to the non-Delta airline clubs through mergers, so there are limits to what they could really "add." And Amex' business is designed for signing up more and more fee paying customers who can pay their credit card bills. Looking at AXP's stock price, their strategy is working so far.

scubadu

Yes, agreed. And honestly, I think the record would show that its working pretty well for them.

That said, I still wonder if there is a market for a more premium airport lounge experience. I feel like there could be, and as mentioned, I'd be willing to pay up (to a degree) for that experience. But I suspect that the credit card lounge game has actually forever changed the dynamics of this business and given the fixed (generally) physical constraints on airport real estate, I'm just not sure the economics could work for providing a premium offering (or if so, it probably would only work at the largest hubs).

I do think there is a segment of the traveling public, that has reasonably high disposable income, that desires a lounge experience that isn't solely about stuffing ones face with as much "free" food and alcohol as possible (frankly, I have nicer food and alcohol at my home) but again, just because some of us desire that doesn't mean there is a business model that can support it.

Regards

Adelphos

Physical infrastructure is big part of it. You know what I think quietly has become the best US airport for domestic lounge access? LGA.

1) Delta has its largest SkyClub in its system at its terminal - they just expanded it, and they even have space to add another
2) At Terminal B, you have a number of new clubs (Chase, American Airlines, American Express, United, Air Canada) with Capital One coming soon. I visited the Chase club recently and found it spacious and not overcrowded. The American Club is also pretty big here, and the Amex club is fine.

The big change here is that LGA basically rebuilt the airport over the past five years (with a lot of work done during the pandemic), so they had the ability to actually the ability to add the space. With many more passengers, some of these airports need to be essentially rebuilt and expanded. You do that, all of these clubs can expand to meet current demand.

scubadu

I don't disagree with your overall conclusion, but I might quibble (respectfully) a bit with some of your specifics.

First, #1 and #2 are sort of the same thing. That is, if they dropped all the "coupon-book credits" that would, ipso facto, increase the effective annual fee which is what really matters (in terms of decreasing demand).

With respect to #3, I don't know if that would help lounge crowding at all. In fact it might just exacerbate the problem (i.e. making the card "even better" doesn't reduce demand, it might increase it).

But I completely agree with your overall conclusion regarding the business success that Amex has experienced with the change in their strategy. You are absolutely right, it's certainly working for them.

Generally speaking, credit card benefits are quite scalable. For example, if you offer all cardholders a discount to the Wall Street Journal. It really doesn't matter (within reason) how many people take advantage of that offer, for the most part your enjoying of the Wall Street Journal does not impact my enjoyment of the Wall Street Journal.

However, airport lounges, as a credit card benefit, changed the game, for the worse, in my opinion, because increasing the number of people that can gain access to what is fundamentally a fixed, physical space does in fact effect the experience (i.e. it generally makes it worse). Its really no different than the fact that there are a fixed number of first/business class seats on airplane or a fixed number of suites in a hotel. But in those cases, demand is controlled via pricing mechanisms. The credit card companies though have removed (largely) the pricing mechanism that would control demand to this fixed and limited size space. They put on a show of doing things that appear to address the issue (e.g. reduce guesting, etc) but then they almost simultaneously increase the benefits on the card or offer ever greater SUBs or increase marketing to segments they haven't tapped yet, and thus like a new highway that experiences gridlock traffic on the day it opens, their policy changes are already neutralized by other market dynamics almost before they are even enacted.

As I said in a previous post, I'm not naive, I certainly don't believe that we are going back to the "old times." Just not going to happen, but a fella can certainly daydream about a better lounge experience...

Regards

mia

I have created this new thread to host discussion of the general problem of Centurion Lounge crowding. This is not a thread in which to report specific problems at individual lounges. Instead, please use the dedicated thread for each lounge. For convenience, there is a list of threads in the Wikipost at the top of this thread.

To create this thread I did something a little different. I reused a post from 2015, the first post in the first thread to discuss crowding. I think this will give us some temporal perspective. This is not something that happened "after the Pandemic", we are a decade into this phenomenon, with several policy changes, and probably more to come.

The other posts in this thread were imported from a recent thread. A few posts were deleted or edited. Treat other members and their ideas with respect. Please make your point once, and then give others an opportunity to participate. Repetition does not improve the quality of ideas.