American Trying to Get Additional Revenue the Right Way

(MoneyWatch)  American's announcement that it would roll out a fee for checking the first bag was a desperate attempt to raise revenue that hasn't sat well with travelers. Today, the airline showed that it can actually come up with smart ways to raise revenue as well by rolling out a greatly enhanced hotel booking site.

Now why do I say this is the right way to do it? Well, it's actually adding value for customers and it can generate revenue. Go figure. Think about it this way. The airline already has American Vacations putting together tour packages and arranging plenty of hotel space. Why not offer that as an a la carte product to all the fliers who aren't looking for a traditional package? They should, and they'll earn money off of it.

The announcement today says they've beefed up the number of hotels they have, offered a price match guarantee, and probably the most important, they'll now give you 250 miles when you book. Mileage freaks will certainly jump on that if the price is the same, and with the price match guarantee that will be the case. As smart as this is, the airline doesn't go nearly far enough.

My only complaint? Why is this not better integrated with the booking process? Delta allows you to book a hotel at the same time as you book a flight using your credit card only once. And Allegiant set the standard for selling rooms to fliers. American doesn't even put hotel options in the booking process. You have to seek it out, and that's a mistake. But, it's a step in the right direction, so they deserve credit for that.