Alaska Airlines Opens the Kimono on their Frequent Flyer Program (and Other Interesting) Stats

Ok, I both abhor and love that way-overused and slightly-inappropriate corporate-speak (“open kimono”). But they very much laid bare some interesting data about their airline partnerships and frequent flyer redemptions at an investor conference (powerpoint, webcast) and offered some great insights.

The two charts I found most interesting:

When Alaska made small tweaks to its award chart this week (aka modest devaluation) it seemed both minor and incosnequential to people who are interested in their great international partner awards that can now for the most part be booked on their website — since the changes touched only Alaska’s own flights.

But the presentation makes clear that 84% of Alaska’s redemptions are for travel on their own flights, 12.5% are on domestic partners American and Delta — with twice as many American redemptions as there were on Delta. That certainly says something about relative award availability, considering how coordinated Alaska and Delta have been.

3.5% of miles are redeemed on Alaska’s international partners. 40% of those are for first or business class.

Less than 2% of Alaska miles are redeemed for premium cabin international partner awards. That number has actually decreased over the past decade. Will online redemptions change that? Not everyone realizes you can book awards that aren’t offered when you enter the city you want to travel to into a website.

There are 3 million Alaska Airlines Mileage Plan members. About 1 million of those have their co-branded credit card. Changes to their card agreement with Bank of America are expected to generate an additional $54 million in revenue in 2014 — which is even more than Alaska anticipates from changes in fees.

Alaska sells an average of 5 first class seats per flight. That’s not low, but they’ll be introducing new discounted fist class fares to try to sell more of the seats (making upgrades harder).

Meanwhile, there are clear cracks in the Alaska-Delta relationship, with Delta entering many markets from Seattle that Alaska serves and even battling it out with their respective frequent flyer programs with bonuses. Alaska was coy yet obvious in their presentation that they constantly re-evaluate partnerships, and they could certainly get closer to American.

(HT: Lucky)


About Gary Leff

Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel - a topic he has covered since 2002. Co-founder of frequent flyer community InsideFlyer.com, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

More articles by Gary Leff »

Pingbacks

Comments

  1. Delta is no friend to Alaska any longer. I’m sure they are making the good people at AS sweat a little, but I’m sure they can hold their own as this “Johnny come lately” cannot erase decades of good will they’ve built with the Pacific Northwest (baggage handlers excepted).

    Everyone knows that AS wants fiercely to remain independent. Since Delta cannot buy them, it looks to me like they are using strong arm tactics to try to gain some leverage. Looks like Delta is getting a little greedy, and corporate greed is never a quality people like.
    Perhaps Seattle’s hometown all Boeing airline should look into operating a few Dreamliners to Asia and perhaps Europe. Check mate Delta.

  2. Looking at 2% of redemptions for International premium travel.
    The heading for chart says Award redemptions not miles redeemed.

    I am not sure if % of miles used overall for Internal awards is 2%
    or
    % of awards used, regardless of size of award is 2% for Premium travel.

    Even if the latter,
    The most expensive award is say Emirates at 200k
    2% x 200k = 400k% miles
    84% x 12.5k (min domestic) = 1000k% miles
    Even then only 1/3 of AS miles would go to expensive partner redemptions. Most stay on AS network.

    Interesting info that I would love to have from US, UA and AA
    (and the NW/CO data) and DL. I hope AS leans to AA more as well.

  3. Of the 1 million card holders many of those may be members just for the points and not members because they fly Alaska a lot (like me). it seems that the active membership list would be much smaller. It is a good program though.

  4. I realize that Alaska wants to be independent, but iWork’s love for them to join one world and start flying to lhr, hkg, nrt, etc.

  5. Nice to see them adding lower F fare buckets. That could provide a very sweet opportunity to use my four old-style BofA BOGOs. I was expecting to use them for 200% EQM credit to DL, but that relationship won’t be around much longer.

  6. “corporate greed is never a quality people like.” My 401K and my son’s future Stanford education disagree. Since corporate greed is actually stock holders wealth like school teachers, firemen, and likely you it would best for them to make a big profit. Not to mention the more money they have the better they can take care of the planes.

  7. Gary, since you “abhor” the phrase, and since some consider it a racial slur, why not just stick to “laid bare”. We might lose a colorful no-harm-intended turn of speech, but English is a rich language and you’d find felicitous alternatives.

  8. @pdl345 – I’ve actually never heard anyone say they considered it a racial slur, which isn’t to say that it’s not or that no one could think that. I just think it’s an overused phrase.

Leave a Reply

Your email address will not be published.