Delta Is No Longer A Good Enough Airline To Keep Gutting SkyMiles

Before the pandemic Delta Air Lines was a meaningfully better airline than its peers.

  • It would go months on end without cancelling a mainline flight
  • Cabin crew were friendlier
  • And there was more investment in the product

Delta went so far as to hot towels and welcome cocktails, along with amenity kits and thank you’s from the staff, in international economy.

The Atlanta-based carrier has had the strong brand in the U.S. aviation industry. They had the best performance. And they had a strong position at key hubs.

  • If you lived in Atlanta or the Upper Midwest, the only viable option for many customers was Delta
  • And they’d made sufficient investments in places like New York that they created loyal customers.

Unlike other airlines, they did not need to make the same investments in points programs to keep customers loyal to the airline. And that loyalty kept them engaged with the airline’s co-brand American Express card. They created a lucrative partnership with American Express which, thanks to the historic moment of Costco terminating their own Amex co-brand, put Delta in the drivers seat there. American Express had to overpay to secure the Delta partnership, setting off a chain reaction in the industry with ever more expensive co-brand deals.

Delta says that nearly 1% of GDP is charged on their cards, that they’re going to generate nearly $7 billion in revenue from American Express this year, and that they have an eye towards growing that partnership to $10 billion.

And they’ve been able to do with with an intentional strategy of making the SkyMiles program less rewarding than airline peers, according to the program’s Vice President Prashant Sharma. He says they want the value they offer to be “sustainable” and “not necessarily trying to play the game with customers” of delivering outsized value. Instead of a valuable currency, it’s the overall Delta “experience” that keeps customers engaged.

This strategy has worked for Delta. They’ve made consistent cuts to the value of their miles over the last decade, but when doing so their co-brand’s charge volume hasn’t suffered in the same way that co-brands at other airlines have taken a hit when making similar changes.

There is obviously some point at which Delta cuts too much,

  • If the value of SkyMiles were zero it would not motivate customers
  • So some amount before reaching zero is pushing too far

Here’s the thing. With Delta’s latest changes, demanding more from customers without giving them more, they believe they’ll push customers to spend more on their cards in order to maintain their experience and not lose out. Clearly they will lose some customers but the bet they’ve made is that requirements like,

  • $75,000 spend on a $550 annual fee card just to keep unlimited lounge access, which is a standard perk (without spend) of similar products at other airlines
  • $150,000 spend on that $550 fee card to keep Diamond status for someone who was doing so with the minimum-required $20,000 in ticket spend already

But on net they think they’ll gain. Except Delta isn’t as good an airline as they used to be and certainly not as good compared to competitors.

  • They are still the most reliable overall, but only by a few percentage points each month. United and American are catching up, and Delta now cancels flights in a way that they never used to.

  • They offer free inflight wifi and seat back video like JetBlue. United is adding seat back video, and has said they plan to make wifi free.

  • Their flight attendants are friendlier than American’s and United’s, though not necessarily friendlier than Alaska’s or Southwest’s.

  • Their inflight food and beverage program still hasn’t recovered from the pandemic. Their business class seats have doors on some planes, though American is adding this and United is expected to also.

God Save The Points says that Delta can make changes to its programs, and customers will shift their behavior to give the airline more out of a fear of missing out, because they’re the best airline. But this is anchored in the past.

One Mile at a Time points out that their business class product is inconsistent at best, featuring numerous “Boeing 767s with really uncomfortable business class seats, plus ex-LATAM Airbus A350s, that don’t even feature direct aisle access.”

Dedicated business class lounges are coming, and while Delta’s Sky Club’s still remain a cut above United Clubs and American Airlines Admirals Clubs (when you can get in, and the crowds inside detract from the experience) they still don’t have the equivalent of United’s Polaris lounges or even American’s Flagship lounges.

American and United are in many ways rising. Delta isn’t as good as it once was, though that could change. Ultimately brand follows the underlying reality, even if imperfectly and with a lag.

Delta is not a good enough airline to keep doubling down on the path of low value miles, expecting more from the consumer, and seeing the consumer continue to respond.

If you live in a Delta hub, maybe you’ll keep flying them but get off the status hamster wheel. If you live in a more competitive market, you might give American a look (if you want to earn status from things other than flying) or United (if you earn status primarily from flights).

It’s too bad that the Department of Justice entrenched Delta’s strong position in New York by preventing American and JetBlue from partnering to be a competitor there, and in Boston where Delta also considers themselves to hold the leading position.

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, 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 »

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  1. Redeemed most of my sky miles in June at a penny a piece. Canceled my SkyMiles AMEX card in July after 25 years. I can’t believe I stayed in this program for 25 years!

  2. I see you are trying to get some of that Tim Dunn comment boost traffic, ha. Generally agree with most of what you said, btw.

  3. It should not be lost that delta redemptions are generally 50% -75% higher for International biz class if not more. There is much better value for aspirational intl awards on United and American. Tope tier elite upgrades are much better value on AA/UA vs DL too. I am lifetime gold, but dont see staying on the Delta devaluation hamster wheel when United delivers more with only a slightly lower day to day experience

  4. Y’all trying to kill poor Delta Dunn. After yesterday’s blog at OMAAT poor Tim is having a rough week. But I agree with your assessment Gary. Critical mass is coming.

  5. 90% of the public isn’t paying enough attention and will probably never redeem their DL miles for travel. DL needs only to maintain a Potemkin Skymiles program to retain these customers.

  6. Not sure why AMEX should pay anything to Delta, except when buying some miles if the customer wants to transfer points. Why would any sane AMEX investor agree to anything more? AMEX should be in the business of making money, not propping up Delta.
    With AMEX you can transfer points to Aeroplan, but AMEX is not propping up Air Canada.
    With AMEX you can transfer points to BA, but AMEX is not propping up BA.
    With AMEX you can transfer points to Flying Blue, but AMEX is not propping up AF/KL.

  7. This is what nobody has reported: If Delta is opening Delta One lounges early 2024 then wouldn’t the regular Sky Clubs be thinned out in big markets?

  8. If my recent experience in DL’s Intl PE is at all representative, where it was hard to decide which was worse, the food or the amenity kit – oh yes, the seats on the 767 were terrible as well, not to mention the service.
    My comps for Int’l PE are BA and SK, both much better experiences.
    Out of AUS, I’ll certainly take less efficient connections for Int’l J to be able to fly UA Polaris, if the nonstop to FRA on LH isn’t available or doesn’t connect well.
    And, I’ve basically given up on getting decent value for Int’l premium awards with any of them, so will spend down for domestic flights.

  9. Tim had a rough enough day yesterday, this might send him to the hospital! Wait till he sees TPG today encouraging people to change loyalty away from the once great Delta!

  10. @ Gary — You are way to kind to Delta in this post. A MAJORITY of Delta’s transoceanic flights are operated by crappy 767-300s, A330s, and LATAM A350s. ALL of United’s transoceanic flights are operated by aircraft with new(ish) Polaris seats. Delta has ZERO premium lounges. United has SIX. Delta is part of the pathetic SkyTeam alliance. United is part of the arguably best Star Alliance. Delta requires $35,000 qualifying dollars. United’s equivalent 1K requirement is $24,000. Delta forces you into a relationship with AMEX if you want to use their overrated, overcrowded Golden Corral SkyClubs. United allows you to buy a membership even if you are just starting out as a business traveler or provides unlimited access with an equivalently priced credit card from Chase. Delta’s call centers are mostly filled with incompetent new hires that need to put you on hold for an hour to get help with fairly basic tasks. United’s 1K call centers have shorter wait times and generally more competent agents.

    Never fear, non-flyer, honorary Diamond non-rev Delta retiree Mayor Tim Dunn, will be here soon enough to explain why Delta is still the best.

  11. How many people can realistically put $150,000 spend per year on a card???

    I like to think I am upper middle class and there is no way we would come anywhere remotely close to that $.

  12. I’ve been critical of them but now I have to give the devil it’s due.

    We are flying out Singapore Air on Sat from JFK. Coming from Birmingham, AL thru Atl

    Woke up this morning to the news of the tropical system headed for east coast. We had the timing of our flight on Delta into JFK tighter than we normally do. Given DL propensity for delays and groundings if there are 3 consecutive raindrops, we got concerned.

    Daughter got in on the phone in under 4 minutes (minor miracle) and they cheerfully changed our flights to earlier ones, no additional cost.

    So props and thanks to them. We are both medallion but she’s the higher status and got it done.

  13. nsx has an interesting point, there probably won’t be as big of a ripple outside the miles and points community, lots of people will get a mailer, take the sign on bonus and think “hey, free flights” without doing any comparison.

    Some companies just don’t try to compete based on loyalty programs. Best Western is an example in the hotel space. Their program sucks. They invest in corporate and association discounts instead.

    Of course, Delta is not just trying to achieve parity with less investment, they are trying to double their CC spend. That will be hard, especially with TPG dominating search results and coming out so aggressively against the changes.

  14. Loyalty to any airline mileage program is dumb in a world where you can get 2-5% cash back on anything.

  15. As ATLanta residents, my wife & I have been loyal Delta customers since prior to the launch of ORIGINAL Frequent Flyer program in 1981.
    Gradually, we have both “earned” Platinum Medallion AND Million Miler “status” through combinations of flights and Delta AMEX Reserve Card spending.
    We almost exclusively flew Delta knowing we were likely paying more, but the benefit seemed to outweigh the cost difference.
    NOW, all that has changed.
    Delta has given us The Finger, so we are prepared to reciprocate since our loyalty was not reciprocated by Delta.
    We’ll use up our skymiles this year but once our Platinum status expires, we’re gone. We’ll also dump the expensive Reserve Card (unless program adjustments are made).
    This may be Delta’s “BUD LIGHT” moment.
    Stay tuned…..

  16. I cancelled one of my personal Skymiles Amex cards and my business Skymiles Reserve card last week. The agent did not seem to care when I canceled the first card, when I canceled the second she started throwing out incentives. The companion ticket is worthless these days and just try using an upgrade certificate on any flight you really want. I’ll be shopping on price and itinerary going forward. Delta just lost a 10 year Diamond Medallion member and a 15 year exclusive Delta flyer.

  17. Why would anyone who is not hub captive or corp contract choose DL for TATL or TPAC? The product is not significantly better, and skypesos are almost worthless? Fares are not cheaper and routing/partners are at best equal. Do elites get regularly upgraded on international flights?

    Why would anyone use a DL Amex card for everyday spend once they have received a SUB, when the skypesos earned are almost worthless?

    How long will inertia keep DL customers from figuring out the grass really is greener elsewhere?

  18. Tim Dunn is over his parents data plan. He’ll be back when the next billing period begins. Hang tight everyone.

  19. Is it fair to compare Delta Diond to United 1K though? At $35k to qualify, Diamond is more equivalent to GS that you can get to with credit card spend. If you don’t make the $35k, does it matter? You’re jsut behind the $35k people on the upgrade list, same as you’d be behind the GS folks on the United list.

    Obviously skypesos have been low value forever, but all these recent changes really do is elevate the experience for Delta’s most profitable customers, just like UA has been for ages with Global Services.

  20. @Chris Raehl – $35k is not far above average 1K spend, it’s just a lot higher than minimum 1K spend. It’s not Global Services spend (or Delta 360 spend).

  21. Like a cheap basement college party, they don’t have limes for standard drinks in 1st class! #dump Delta

  22. @ Roberto — Tim Dunn is 80 years old.

    @ Chris Raehl — What Diamond beneifts? Some upgrade certificates that are basically discounts on first class? Just get your own discount by choosing the least expensive first class option every time.

  23. @Roberto, Tim Dunn is noticing that Delta stock has been inching down since this debacle was announced and is starting to wonder if there actually is something to the conventional wisdom that real investors don’t get emotional about their investments.

  24. I never flew on Delta until 2021! Luckily, I live near Seattle, WA so I can fly on Alaska Airlines a lot (and I earned MVP this year). But occasionally, I like to try out different aircraft, so I’ve flown on Delta on their really nice, newer Airbus A220, as well as an “oldie but goodie” Boeing 757!

  25. How does one measure the “friendliness” of airline staff. I would like to know that figure is calculated.

  26. The halo effect around Delta is over-done. Is it better run than UA and AA? Somewhat yes. It has some built in advantages, strategically owning its hub markets (not all, but most) far wider and more effectively than the other 2, but service wise, Delta isn’t the same as it was pre-pandemic and is subject to the same issues and challenges as the other two.

    Delta creates the illusion it is a better carrier. In some ways, it is but it is laughable to think they may view themselves as a premium carrier. They are a trunk carrier, with a mix of old and new planes just like the rest of their US3 peers.

    The loyalty programs as we know them are on their way out, to be spun from the carriers, and fully owned by the credit card companies.

  27. wow. I get talked about more than any other airline personality.

    Spent the day traveling today to find all this.

    The simple reality is that if Delta miscalculated, we will know in less than a year based on their Skymiles/Amex revenue.

    I’m not sure why some people have a deep-seated need to predict anyone’s demise.

    If Delta shot themselves in the sleep, I certainly am not going to lose any sleep.

    But I also trust that Delta has a whole lot more data than alot of people give them credit for and they know exactly what they are doing

    btw, loyalty programs exist to enhance the company’s profits, not to maximize rewards for customers. It is stunning that some people don’t understand that reality.

  28. Gene,
    you are STILL confused despite me telling you and others YEARS AGO that you had the wrong person.

    Doesn’t change that the US probably needs to make next Sept 19 or whatever day it was national Delta suicide prevention day.

    When Delta reports that it is financially better off after all of the cards that some people cut off and all the points some people prematurely cashed it, there will be be people jumping off of skyscrapers.

    There is nothing more devastating emotionally than finding out that all of one’s anger accomplished absolutely nothing
    and the party you though you were harming is actually better off without you.

  29. The truth is that AFTER the pandemic DL passengers were heads and shoulders more satisfied than both AA’s and UA’s in a REPRESENTATIVE survey of 7,774 passengers made by J.D. Power (link removed due to comment filtering).

    This post is obviously a lie and probably paid (directly or indirectly — maybe DL cards don’t pay as high a commission?) like a lot of content here lately.

  30. btw, loyalty programs exist to enhance the company’s profits, not to maximize rewards for customers. It is stunning that some people don’t understand that reality.

    — Tim Dunn

    There you have it. The misguided view of “loyalty” as a one-way street — loyalty programs exist to enhance the company’s profits, not to maximize rewards for customers — that underpins Mr. Dunn’s exclusive reliance on DL’s financial performance (“profit”) to declare it the “best airline in the world”, customers’ satisfaction or quality of product be damned.

    What is truly stunning is that he fails to understand the first thing about “loyalty”, which is that it must be a two-way street, though, admitted, the size of the street going from the customer to the loyalty program tends to be wider because the latter sets the rules. Customers have got to get something in return for their “loyalty” or they are simply being used, which is pretty much what DL has been doing the last few years with its progressive and relentless gutting of SkyMiles that has just culminated in what is now an essentially valueless “loyalty” program. I sort of understood how folks who appreciated DL’s superior service reliability could ignore SkyMiles’ diminishing value over the years. After the latest ignominy that DL has rained on the program, one must truly be brain dead try to keep trying to earn top status in SkyMiles.

    Here’s the big picture, Mr Dunn. Using metrics that place the customer rather than “profit” at the center of international commercial civil aviation, DL does not even crack the top 10:

    1. Singapore Airlines
    2. Qatar Airways
    3. ANA All Nippon Airways
    4. Emirates
    5. Japan Airlines
    6. Turkish Airlines
    7. Air France
    8. Cathay Pacific Airways
    9. EVA Air
    10. Korean Air

    And, no, DL is not a “premium” airline; not by a long shot, and as I predicted the other day, its days as the #1 US airline are numbered because the gap between what put it at the top up to now compared to its domestic competition is narrowing fast…

  31. I have a feeling Gary posts these just to have the rest of his readership enjoy Tim Dunn’s hilarious comments.

  32. Delta’s loyalty program sucks. People should stop spending and cancel their cobrand cards.
    After the Spirit merger falls through, JetBlue should restart the NEA with AA to increase competition in New York.

  33. “ wow. I get talked about more than any other airline personality.”

    Do you realize you’re the serial killer of airline personalities?

  34. @ Mr. Dumn — I honestly don’t give a crap about DL’s finances. It has no effect on my family. What I do care about is getting the best value for my premium travel dollar, and Delta no longer has the ability to deliver that value.

    September 14 should be Delta suicide day, the day Delta committed suicide.

  35. and yet people still don’t understand that the loyalty program is a BONUS. Delta has gained the customers it seeks because it has the network and product to win the highest revenue business.

    In NYC, Delta is stronger than ever. AA is shrinking for the umpteenth time and long underperformed DL in fare performance even at LGA. UA is forced to shrink EWR because it was overhubbed.and the operation has been the worst of any US carrier hub.

    Delta has built LA and will continue to do so esp. w/ the A350-1000s, A321NEOs and A220s – an unbeatable combination of product and efficiency in the air on top of the terminals on the ground.

    Boston has become their fastest growing hub ever and they aren’t through.

    AS and DL have a very stable relationship with DL taking the global and most of the eastern US local traffic and DL and AS splitting the local western US with AS having the edge.

    And this is on top of its dominance of its interior US hubs. and before it makes a major push into Latin America along w/ Latam – but that is coming

    and DL has invested more in its onboard product than any other US airline. B6 might have free Wifi and seatback AVOD but DL is much larger and garners the corporate travel.. AA isn’t interested in those enhancements even though it got to high quality wifi before DL. UA talks alot but is a very long ways from delivering what DL has.

    DL simply is winning over the lucrative business that all of the airlines want, its high value revenues show it, and it simply does not need to incentivize people to fly Delta esp with premium benefits that others really are wiling to pay for.

    Let people like Gene stomp their feel and tell us they are leaving. It will be quite interesting to watch what he posts a year from now when he finds out that Delta is better off then than now and the quality of DL’s premium product goes up even more.

  36. @ Tim — So you are saying that AS and DL are illegally colluding? Sounds like something Delta would do. The following is a pretty low bar “the quality of DL’s premium product goes up even more.” It’s easy to go up from awful. What, will they add 7 more decent transoceanic planes again this year? Maybe one or two premium lounges? Maybe another horrible SkyTeam partner?

  37. I really don’t care about the Skymiles dilemma and loyalty issues. I do care that the Delta One soft product I fly frequently has substantially deteriorated over pre Covid levels. Limited appetizer options, no bread selection, limited hot towels service, no wine program, missing after dinner drinks, terrible amenity kits, bedding etc etc. Little things all add up..IThere is nothing that differentiates Delta from UAL or AAL anymore.

  38. @ Tim — I see Delta announced several new routes to Europe today. Unless I missed something, I saw no mention of the aircraft that will operate these routes. I assume more crappy planes? All while United flies Polars and Swiss is vastly superior in most ways..

  39. Here’s the dirty secret: Delta was never good. I’ve never had a good flight on DL, ranging from transatlantic to regional. The FAs treated everyone without status (like me) like trash. The seats were uncomfortable, the airplanes decrepit. In summary, it’s misery aboard the Widget, and when I have to take them, I try to make sure the flight is as short as possible (I would kill for UA service to Grand Forks, North Dakota).

    Your experience may differ. I can only go by my experience, and I don’t care about surveys. Delta would be the worst if B6 didn’t exist.

    I’m very fortunate in that I have choices of where to put my money. I declined to do so on Delta due to the experiences I had when I was forced to fly them, plus the fact that I would have to transfer at ATL, DTW, or MSP (an airport I truly loathe) for anywhere I’d want to go. I’m happy to be a 1K on Chicago’s Hometown Airline with direct flights anywhere I want to go and a plethora of decent lounges to choose from (I’ve had great experiences in United Clubs, Air Canada Maple Leaf Lounges, and Lufthansa lounges thanks to the easily-obtained Star Alliance Gold I get from MileagePlus). And there’s never a line at United Clubs, especially now with scan-and-go entrance kiosks.

    Unless you’re in a captive hub, wait for a status match for UA and/or AA, then try them out. They at least respect you as a frequently flyer.

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