Revenue Based Loyalty – Wearing Shades in a Dark Room

Gary says he’s glad my frequent flyer future is so bright that I have to wear shades. Admittedly, I’ve thought for a long time that change was coming to the frequent flyer landscape, it has just taken longer than I imagined. In a true “Forest Gump” moment almost 10 years ago (gasp…time flies), I was privy to a conversation between some airline people, a few with names many of you would likely recognize. The gist of the conversation – the things that the coming “revenue based” emphasis profess to fix needed to be addressed…..nearly 10 years ago. What took the airlines so long? Fear, I think. Fear of the backlash, fear of the unknown. That, and bigger fish to fry like rethinking their business models, turning the act of selling transportation between points on a map into a profitable endeavor, and buying each other. They also like selling miles, but that’s a blog post all its own.

When I profess joy about SkyMiles 2015, it’s more about generating discussion than amorous feelings. The truth is that as things stand now, I earn more miles under SkyMiles 2015 overall than the current program, that’s a given. The real question is will I be better able to redeem them? And for that, only time will tell. I’ve burned a lot of SkyMiles in the last year. Not because the sky is falling, but because that’s what miles are made for. In the end, it’s Delta’s program and my choice to fly them. Incidentally…or perhaps not incidentally, they make it easy to fly them. They have the most non-stops from the city where I live, they view operating a schedule as something more than a letter to Santa Claus, and they treat me fairly well as a Platinum Medallion. For me, the mileage program is not at the top of my list when I choose an airline. Miles are a side benefit for doing something I’m going to do anyway.

If Delta eliminated SkyMiles tomorrow and if all the airlines followed them, it would not change my need to travel. It could impact my choices when it comes to leisure travel, but then I’m back to picking an airline based on service, schedule, and price. Delta still wins. When it’s all said and done, I do believe that the entire US airline industry will be on some kind of “revenue based” model within 2 to 3 years. The real question is what will American do, and will it carbon copy the others? As the grand-daddy of mileage programs, there is potential for a different take on things. We’ll see what happens.

-MJ, June 19, 2014

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[…] This is not a slam on Delta, SkyMiles, MileagePlus or any other program. You know how I feel about “revenue based” […]

[…] Revenue Based Loyalty – Wearing Shades in a Dark Room […]

Phil

Couldn’t agree more with MJ. Revenue based programs will have no impact on my travel plans and the constant whining about the changes is amusing. I fly Delta almost exclusively. Why? I live in a city that’s a major hub for them. They offer great service. Their prices are comparable to their competition and as a Platinum I’m upgraded on almost every flight. To me, the customer service is far more important than whether I earn 90,000 miles or 120,000 a year. The number of miles I earn on a flight has absolutely no impact on my travel patterns.

Scott

I’ve been flying United this year; and its purely for the mileage program. Denver to SJC and SFO over and over with a little ORD, PDX, SEA, and LGA/EWR thrown in. Without the mileage program I’d probably be way better off with Southwest, as I sometimes need to make changes to my itinerary.

Scott

So here is my take on this post, and not attacking or anything. You said you’d come out better in SM2015, so obviously you’re spending over 20c per mile then; my 1st question is, if SM is eliminated then you say you’d still fly Delta based on one of the reasons being “price.” I find it hard to understand that Delta is the cheapest airline available to you at over 20c per mile. Now that said, I’m someone that is loyal to an airline based on earning miles. I fly UA or AA or BA sometimes for 300-500$ more because… Read more »

glbetrkkr

I agree with you, MJ, that I would probably still fly DL even if they eliminated SM tomorrow. I live in New York and DL flies to MANY places (small and large) from both JFK/LGA. I’m accustomed to their service, fleet and offerings. I cringe at the thought of having to fly F9 or NK. I’m looking forward to SM 2015, especially one-way awards! At the end of the day, it’s all an individual choice. Yes, I can probably save a few dollars flying Spirit, but why put myself through that? My friend recently flew UA from EWR-HNL, nonstop. He… Read more »

Nick

I can only speak about United, in the time I have flown a million miles on United I haven’t set foot on a Delta plane. This change just pushes me towards the Jetblue’s, Frontier’s and Virgin America’s. If I’m not going to earn very many miles for a flight why would I put up with sub par operational performance, lack of upgrades and bad employee attitudes. Mileage Plus was United’s strongest hand, and they tie that kept many flyers loyal.

Tyler

Completely disagree on many fronts. Legacy carriers are shooting themselves in the foot. Their ff programs are the only thing that makes them worth flying than their vastly superior foreign competitors- Cathay, Koren, Singapore, Etihad, Emirates, Qatar, etc. By going revenue based on top of their massive devaluations, Delta and United took away all motivation for me to fly them. And if AA does the same then I’ll change my strategy and fly SWA domestically with foreign carriers internationally. Given SWA’s free change fees, award redposits, etc. they are clearly superior, and international carriers provide an infinitely better flight experience-… Read more »

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