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Loyalty programs were meant to entice customers to stay loyal to a brand. However, as industry trends changed, these programs morphed into spending programs. Simply put, brands thought that the best way to gauge loyalty was by determining the magnitude of purchase instead of its frequency. When the markets were humming along, we saw may travel loyalty programs lose value. United recently obliterated award charts in November 2019. United has now chosen to put the final nail in the loyalty program coffin. It has now removed partner award charts from its MileagePlus program.
United MileagePlus Partner Award Chart
Doctor of Credit posted this update about United MileagePlus removing award charts from their website:
United claimed that partner awards would remain the same price and the partner award chart remained on the United site. Today the partner award chart has been removed from the United site.
Pricing Implications
Previously, we saw United apply ‘dynamic’ pricing to awards for flights on United. Now, this applies to all of their Star Alliance partners. Frequent flyers prefer award charts as it gives them a sense of predictability with regards to a floor and ceiling price. With dynamic pricing, United can charge as many miles as they want to, based on their calculations of demand and supply.
In basic pricing theory terms, dynamic pricing denies the customer the ability to get a true measure of value v/s price. With lack of any reference point, the customer is subject to the whims and fancies of the price the business charges, which in this case is United.
Timing is Key
What’s even more surprising is the timing. United has chosen to make this move at a time when the travel industry is reeling and when airlines have just received taxpayer funded bailouts. In addition to this, United has already drawn customer ire due to the way they’ve handled refunds. The icing on the cake is that fact that customers already see United as one of the least customer friendly airlines, as pointed out by Nomadic Matt. As evidenced in these reports and many more, United hasn’t covered itself in glory with its own actions.
Miles from Blighty – United cancels most flights to/from Europe and denies refunds
View from the Wing – FAA Administrator Joked With United During David Dao Crisis in Released Emails
The Pundit’s Mantra
As far as flexible points currencies go, I’ll call this a minor devaluation for Chase Ultimate Rewards as well. After I stopped flying United back in 2014, I still transferred my Ultimate Rewards points frequently to United MileagePlus. I used United miles to fly their Star Alliance partners frequently in premium cabins to South East Asia and India. Now that United has effectively killed any remaining value out of it, I’ll primarily be using my Chase points to transfer to World of Hyatt.
Also, I’ll be focusing more on racking up Membership Rewards points. Amex Membership Rewards points have a wider array of airline transfer partners. For example, I recently transferred my Membership Rewards points to Avianca LifeMiles to book a Star Alliance award during my trip to Colombia.
Some people may find value in dynamic pricing on short haul flights. Just like Delta, expect United also to launch their own version of ‘flash sales’ soon. However, in all likelihood, this doesn’t bode well for premium cabin redemptions as their prices will likely increase.
How does this most recent change affect your loyalty to United? Let us know in the comments section.
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Hat Tip to Doctor of Credit
A good post on a worthy subject. This move on top of the others that Scott Kirby has recently instituted just show how out of touch he is with normal people.
From the Chase perspective, this absolutely devalues Chase points. Now the only really worthwhile transfer partner is Hyatt.
Hi Christian,
Thanks for your comment. United’s move is just another example of a corporation willing to ask for our (taxpayer) money to bail them out for their mismanagement, but continuing to care less about improving the customer experience. As you alluded to, I’ll be taking a closer look the next time my Chase annual fees are due.
I realize there isn’t much to write about, since travel bloggers aren’t traveling for some reason. (I am, all over the country, every week in fact) But, articles like this are just so…. ignorant. They really lower the bar for blogs. Our government over-reacted. Everyone sees that now. So, because they print the money, they are just handing out free money. And everyone is taking free money – because that’s how dumb our society has become. We are no longer independent – we can only function if the government gives us free stuff and makes all the decisions for us.… Read more »
What does this have to do with the subject of United pulling another sneak devaluation?