United Airlines has named Richard Nunn as its MileagePlus CEO, a newly-created position that will “oversee the next chapter for the continued expansion of United’s industry-leading loyalty business.”
Richard Nunn Named United Airlines MileagePlus CEO
Richard Nunn does not have airline experience. Per an internal memo sharing news of the appointment with employees, United described Nunn as possessing two decades of experience in “advertising technology, digital media and data expertise, building and scaling businesses globally, and leading media technology groups spanning the world.”
Most recently, Nunn worked for Comcast, where “he built and led the Advertising Platform, a data enabled audience technology which unified and powered their multi-billion-dollar advertising businesses.” Nunn is a British national with a BA in business and accounting from City of London Polytechnic.
Executive Vice President and Chief Commercial Officer Andrew Nocella heaped praise upon Nunn:
“Richard’s digital expertise makes him the ideal leader to accelerate the growth of MileagePlus as the team pursues innovative opportunities to make the program even better for our customers. I’m excited to see how improving our customers’ experience and engagement with United and our partners will unlock brand new business opportunities.”
No further details were provided concerning such “innovative opportunities.”
Bondar Still President Of MileagePlus
Nunn will not replace Luc Bondar, who serves as United’s Vice President of Loyalty and President of MileagePlus. Nocella added:
“Luc’s leadership has been instrumental in so many innovations at MileagePlus over the last five years. He has built the program’s public profile, proven its value to investors, and delivered record-breaking growth, member engagement, program performance and commercial results year over year, all while building closer, stronger and more valuable relationships with our many partners. The unbeatable combination of Richard and Luc in these leadership roles will power MileagePlus to new heights as the best and most valuable loyalty program and business in the world.”
Bondar will report to Nunn.
What Is In Store For MileagePlus?
Bringing in outsiders always worries me. Nunn appears to have sterling credentials in the digital ad making space and it is perfectly understandable and reasonable that United is looking at further ways to monetize its cash cow, MileagePlus.
At the same time, speaking as someone who has immersed himself in the world of loyalty programs over the last two decades, it is essential that United leave intact (and ideally improve upon) its loyalty program, in terms of the value proposition to members.
Comparisons are helpful and I note that the Delta Air Lines SkyMiles program continues to lose value, particularly on the redemption side. With partner award devalued, miles are routinely worth a fraction of a cent on Delta and there is very little value to the program beyond the perks of elite status when flying on Delta.
This is not the case on United. On the loyalty side, United also takes care of its elites with superior customer service and the occasional upgrades (by the way, I’ve cleared a lot more upgrades as 1K this year – it seems we have finally thinned out the herd a bit). But on the redemption side, even though not nearly as lucrative as a couple years ago, the program is valuable: it is worth collecting points and it remains the US loyalty program I find most valuable to patronize.
People are not stupid. When it makes more sense to use a cash back card, they will cut up their MileagePlus co-branded credit cards. Considering Chase is United’s biggest customer, Nunn (and Bondar) must constantly remember that efforts to squeeze more revenue out of the program should not come at the expense of alienating MileagePlus members by robbing them of any meaningful redemption value.
United should look to Air Canada’s Aeroplan as the model to emulate. While Aeroplan is not without issues of its own (lack of web functionality, annoying change, cancellation, and redemption fees), it provides a fair and transparent award chart and continues to add an amazing array of partners.
Indeed, if United wants to innovate and add value to its program, it can start by adding more partners. How about Air Greenland to start? (yes, I’m eyeing a trip to Greenland this summer).
I’m rather agnostic about the appointment of Nunn. I don’t see any red flags, but I also am always concerned by change, since change seems to move in a linear direction toward less value. But let’s see what Nunn does in his new role and hope that he does indeed, as Nocella hopes, make MileagePlus the “most valuable loyalty program and business in the world.”
What are you thoughts on the appointment of Richard Nunn as CEO of MileagePlus?