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American Express, Chase, Citibank, Capital One and Wells Fargo all offer points transfers to airline and hotel programs. So do Bilt, Mesa, Rovemiles and so many others. But those are table stakes, and only half of the loyalty equation. Every program really has two parts.
- Recognition. Elite status for your best customers. They get better customer service, front of line privileges, and upgrades.
American Express reserves spots in their Centurion lounges for actual Centurion cardmembers, who therefore get actual value of the lounges and don’t have to spend their entire layover waiting in line to get in and then have to hunt for a seat. (I can’t understand why Chase doesn’t do this for J.P. Morgan Reserve cardmembers, and Capital One doesn’t find a way to offer it to their highest spenders.)
- Reward. That’s the rebate portion of the program, the free trip, represented by points transfers.
Programs with air and hotel partners shouldn’t just be offering points transfers, they should be offering points redemptions for status with those partners. Not every partner will go along, but it opens up a huge new revenue source for the airline or hotel loyalty program and a unique way for the bank program to differentiate itself from competitors.
Bilt Rewards has figured out something brilliant with its partners. They offer Platinum members Air France KLM Flying Blue Gold status but this requires transferring 10,000 points into Flying Blue.
- Flying Blue gets revenue (for the points transfer) along with the status match.
- Since this isn’t a transfer associated with an immediate redemption, or a big enough transfer for what most people will be transfering for, the points don’t even get redeemed right away. It’s revenue for points that sit on the books, not revenue for points that get spent.
Their Rent Day status match offers with Alaska Airlines and with Accor have followed a similar model, requiring transfer of points. That makes the revenue folks happy.
I don’t think I’d seen anything like it before. It points to a ‘points transfer -> revenue -> status’ model that I believe other programs could learn from. However points transfers for status isn’t new. For instance,
- During the pandemic Singapore Airlines offered status for points-earning from non-flight activities including points transfers from bank programs. This was actually two years of status.
- Back in 2011, first-time American Express transfers to Delta of at least 50,000 points earned a 50% bonus and 25,000 elite qualifying miles. Later that year they did it again with transfers of at least 100,000 points.
Chase offers Southwest Rapid Rewards A-List status and IHG One Rewards Diamond status with $75,000 spend with their refreshed Chase Sapphire Reserve®. I assume they’re working with these partners (and not partners like United or Hyatt) because Southwest and IHG were more motivated to sell the status at scale to Chase cheaply, within budget.
But the budget matters less when the bank isn’t paying, the member is. The bank just sets the points redemption price based on what the program charges them for the status.
Surely there’s some price at which Hyatt would sell Chase Globalist status, and those Chase customers with that many points in their account are in many cases premium enough they should be interesting to Hyatt anyway.
And I’d surely redeem quite a premium in points for British Airways status, since that would gain me access to American Airlines Flagship lounges on my domestic trips (as Singapore Airlines status offered United Club access).
It’s been a long time since we’ve seen many new transfer partners added to Chase or Capital One. Wells Fargo launched their fast-earning Autograph Journey card and promised more than a limited number of transfer partners but those haven’t come yet. Status partners would be a way to generate real excitement and among cardmembers. And members redeeming their points this way are getting more value from their card so would spend more, shifting wallet share to the product that offered it.
And by the way you can already transfer Chase points to Hyatt, and redeem Hyatt points for American AAdvantage status for a given trip. So this just needs to be streamlined!
Does status mean anything anymore?
@Un — no, it doesn’t. Status conferred two huge benefits in the 1990s and early 2000s. One was access to priority security lanes. These are no longer a thing because TSA PreCheck replaced them. The second was complimentary upgrades. These no longer have value. Almost no upgrades clear these days.
I get perks like get into the lounge. But AA status at least is a total joke. AA frontline could not care less about status.
I actually think transfer partners are not “table stakes.” There is WILDLY divergent quality in the IT underpinning each bank’s transfers. Name mismatch issues, transfer times, ability to transfer in sub 1,000 mile increments… all the banks are super highly differentiated in all of these and it makes a massive difference. Citibank to Air France straight up broke for several weeks and nobody uttered a peep. Every one of the last five transfers I’ve made from Chase to Aeroplan has taken multiple days. The pipes are totally undervalued here. Get that right first.
Did @Un just reply to himself? Or is this another impersonation…
I’ll say, these days status is kinda overrated, generally, and really depends on what you want. Like, earlier today, what seemed like half of my United flight pre-boarded, between those needing assistance, Global Services, military, families, 1Ks… finally, group 1, which was just the 12 of us actually seated in First. I prefer the better seat upfront regardless of who boards ahead of me based on status then has to sit in the back. As @Gene says, WFBF.
@ 1990 — Exactly, use those transferred miles to buy first. Who cares about overrun lounges?
I used my Hyatt Globalist status to match to AA Platinum Pro to get One World Emerald so I can choose seats in J on my British Airways award tickets to London without paying the $130 each seat selection fee after paying the $700+ each fee for my “free” tickets. Plus I had the pleasure of having to call BA since my OW status hadn’t been updated on the previously booked reservation after waiting a week. OW Emerald also got me #11 on the upgrade list on Alaska Airlines tomorrow. Status has it’s privileges.
Qualified for AA Platinum pro and it has been pretty useless. Nowhere near the upgrade list DFW -LAX on a Wednesday night 7:45 pm on a 772. Ended up using AS miles to book the last F seat on an earlier 3pm flight showing 0 seats available for upgrades but my 15k AS miles took the last seat confirmed in F. Status is for suckers on AA flights. Kinda regret pushing from nothing to PP in only a few months. I’ve gotten upgrades as AS MVP. With the launch of the new card I will be qualifying over there.
I laugh when AA offers to sell me gold for $649.
Status means nothing to me because I will always be in business or first class, whether by cash or points.
Regarding hotel loyalty, the interests of the hotel owners and the best guests are completely divergent when the so-called loyalty benefits are involved. If it’s about the same price I’ll take the benefits of amex fhr (or similar) 4pm checkout and the breakfast . In fact, the 4 pm checkout is worth a lot to me.