How Delta Just Told Us Their Miles Are an Almost Worthless Currency

A CNBC.com piece offered a point-counterpoint on Delta’s program changes and June 1 devaluation.

“Today no airlines tells you that fares are going up tomorrow or where the fares may change,” said Black. “We have announced that as of June 1, 2016 — more than 300 days away — the award price for some trips will change based on a variety of factors; just like they do today for revenue tickets.”

That’s the airline’s prerogative, but Gary Leff of the View from the Wing blog is concerned customers will be flying blind when booking awards because Delta also recently removed from its website the chart that listed the set numbers of miles needed in exchange for various types of tickets.

“They say some prices will be going up and others will stay the same, and this is based on a variety of factors,” said Leff. “(But) they will not share which prices for what trips will go up, and which ones will stay the same, or how consumers will even know what to expect.”

I want to take issue with the claim by Delta’s Anthony Black that mileage prices are like airfares and so there shouldn’t be a posted award chart or advance notice of changes.

First of all, frequent flyer miles aren’t supposed to be mere rebates in the form of an airline’s currency, they’re supposed to be a reward for loyalty. That’s why mileage tickets used to be so much more flexible than paid tickets, they were a thank you for past business.

Perhaps more importantly though award prices aren’t like paid ticket prices, and certainly miles aren’t really like money.

Most currency issuers have independent central banks or currency boards to protect the value of their currency. They openly declare their money’s value. Delta hides from theirs.

Delta wants to have it both ways.

And yet even then we’re left to figure things out on their own, because Delta refused to say which awards cost more, which are less, or which stay the same. When pressed they replied, “I literally shared all the details I was able to share.”

Virtually every other frequent flyer program respects their members enough to tell them what changes are going to happen with some advance notice.

United once announced changes to their award chart in April and said the changes would go into effect for awards booked October onward. Delta announced a change that says it goes into effect even for awards booked that same day if the person is traveling June or later.

There are lots of June brides, right? Say someone was planning a honeymoon for June 2016. United’s version gives them six months to bring in any additional miles to top off the ones they’ve been saving before booking their award. Delta’s says “Sorry, you’re out of luck, we know you’ve been saving miles for the past 2 years and earmarked them for your honeymoon but now you have to pay us more.”

  • So even if Delta has a narrative for why they shouldn’t have to give notice, all they’re saying is they respect their members less than their competitors.

  • And if their claim is that their miles are a currency, so the analogue is paid fares, then they’re saying they have a much less valuable currency that you shouldn’t go to much effort to earn.

In other words, they’ve taken a multibillion dollar standalone business and told us we should mark down our expectations of its value substantially.

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 »

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Comments

  1. THIS is what I was talking about, Gary. Love it. Don’t let up on these guys. If anyone can hold them to account, it’s you.

  2. “You can spend cash for anything you want.”

    That was the main point of my reasoning — when we were in that car in the Los Angeles area years ago, if you recall — for my preference of using a cash-back rebate credit card versus a card which is affiliated with a frequent travel loyalty program…

  3. Keep hammering on these guys! Maybe it won’t make a difference but they shouldn’t get a free pass on this BS.

    If I were a DL hub captive I’d credit flights to AS and just use a cash back card rather than focus on Skymiles.

    The worst thing will be if/when AA and UA start to copy this approach. Then it’s game over.

    @Joelfreak – I don’t think government regulation is a panacea. Perhaps some minor regulation such as providing advance notice of changes. But I think the airlines would, collectively, rather abandon loyalty programs altogether than put up with regulation. Just my guess though.

  4. Gary gives a good example of the problem here. A bride who was saving miles for years to pay for a wedding/honeymoon, and now can’t even have one person go in coach. They will complain to their lawmakers, who will react. Its happened far too many times to think it wont happen again.

  5. Great piece. Comments above are silly. You want regulation for awards?

    Right, then there will be NO awards! lol

    Honeymooners saving for awards over 2 years? That’s just dumb.

    The right answer is to not emotionally attached to any one program, accrue as many points as possible in as many schemes that you think you will get the best value out of, and burn the points rapidly saving only a small emergency buffer.

    Also, focusing on parts of travel that are difficult or expensive if they aren’t awards

    I.e. :

    – hotels are often cheap on hotwire… 40k hilton points for a shethole ain’t worth it
    – sitting in the front of the plane for a few points more…. definitely worth it

  6. Does it really matter what anyone thinks? Unless their bottom line suffers, Delta will do whatever the law allows them to do. Oh, and they have us taxpayers to bail them out if they really fail.

  7. This post is on point! However, it feels like the definition of insanity — to keep exposing their arrogance and hypocracy in multiple blog posts and online forums, only to suddenly them expect DL to change their behavior and end the tyranny of incrementalism. As long as planes are full and they keep earning a profit, they have no business reason to reverse course. Until people actually put their money where their mouth is and they move their business away from DL, all of these complaints — despite their logic and legitimacy — will far on deaf ears. At this point, reasonable people should consider their SkyMiles balance to be a sunk cost and they should support businesses that respect their customers. Despite how well and how often Gary makes the case, the intended audience isn’t listening.

  8. I’m not a Delta FF, and right now I am very very glad I’m not. I’d be incredibly pissed if I was saving up miles only to see them pull an instant devaluation like this.
    It’s probably only a matter of time before the other airlines try something similar.

  9. This post is on point! However, it feels like the definition of insanity — to keep exposing their arrogance and hypocracy in multiple blog posts and online forums, only to suddenly them expect DL to change their behavior and end the tyranny of incrementalism. As long as planes are full and they keep earning a profit, they have no business reason to reverse course. Until people actually put their money where their mouth is and they move their business away from DL, all of these complaints — despite their logic and legitimacy — will fall on deaf ears. At this point, reasonable people should consider their SkyMiles balance to be a sunk cost and they should support businesses that respect their customers. Despite how well and how often Gary makes the case, the intended audience isn’t listening. Unfortunately, all we’re doing here is tiring ourselves out.

  10. Standby–DeltaPoints douchbag and MJ Kniws Nothing About Travel are hat-tipping each other and will be making a statement soon. Richard Anderson has his team of PR minions are drafting fresh talking points for their use, something along the lines of MJ’s ever so deep philosophical “thoughts” that the airline industry is changing, and we should just accept and love getting screwed since Delta flies airplanes with new blue vinyl seats and mostly, on good days, runs a good airpline. If only Spirit Airlines would just cut those two a credit card affiliate deal….

  11. I rather like the new SkyMiles system the first time I used it. Availability is vastly improved and I just booked MDW-MSP RT for 10k SkyMiles. Round-trip. 10k + $11.

    I think this may be British Airways all over again. Wailing and gnashing of teeth and now I use Avios more than any other award miles. Southwest (another revenue-based system) is a close second.

    As long as we can maintain a nice mix of zone-based, distance-based, and revenue-based programs, we can optimize things *even more* than before.

  12. Sad that state and federal Supreme Court judges have sided with airlines in their interpretation of the 1978 Airline Dereguatlion Act in the fact that miles and points are part of ‘pricing’ so they can do whatever they want. Frequent Flyer programs weren’t even around when the ADA was written! Maybe one day politicians will can add some additional provisions for miles/points

  13. I’ve burned all my Delta SkyPesos and will NEVER fly them again. Their lack of transparency and disclosure by eliminating their award chart was the nail in the coffin. They keep digging themselves deeper with total disregard to their loyalty program members.

  14. This is another reason why our domestic airlines do not need protection from the federal government. The market should decide whether Delta, United, etc., can stand up to the competition from international carriers.

    Foreign carriers provide a far superior experience and product. In stead of trying to improve their own product, they remove a major incentive to fly with them with devaluations. Baggage fees, seating fees, reservation change fees, ticketing fees make my blood boil. No wonder I try avoiding flying domestically whenever possible. I literally hate flying. I’d rather drive and I really don’t like driving.

  15. I still love Delta. I recently booked two Business Class tickets ATL-LHR for 45,000 miles each. I’m kind of stuck with them because I live in Atlanta but I still like their program very much.

  16. This post is on point! However, it feels like the definition of insanity — to keep exposing DL’s arrogance and hypocracy in multiple blog posts and online forums, only to suddenly expect DL to change their behavior and end the tyranny of incrementalism. As long as planes are full and they keep earning a profit, they have no business reason to reverse course. Until people actually put their money where their mouth is and they move their business away from DL, all of these complaints — despite their logic and legitimacy — will fall on deaf ears. A lot of people who were disadvantaged by SkyMiles 2015 complained but they’re still giving DL money, so in essence they are punishing themselves by sticking with them. At this point, reasonable people should consider their SkyMiles balance to be a sunk cost and they should make the decision to support other airlines that actually respect their customers. Despite how well and how often Gary and other readers make the case, the intended audience isn’t listening, and since they are printing money on Virginia Ave. they have no reason to…for now.

  17. Nice to have the Gary we love back.

    Can you also remind AA that their miles are becoming worthless given that sAAver availability is almost 0.

  18. If you are willing to set aside Delta’s complete lack of integrity and look at what the program currently offers, you will find that some reasonable uses for DL miles remain. Short-haul last-minute bookings are particularly competitive with other programs which charge late booking fees.

    As with Avios, it’s a matter of identifying and exploiting the sweet spots. We aren’t going to bend these programs to our preferences.

  19. @AtlantaAnne I believe you are mistaken on 45,000 miles for Atlanta – London. Would love to see that e-receipt. “Level One” pricing is 62,500..

  20. We want our money back, from the pensions off loaded to the government, for the 9-11 bailouts, for the stockholders erased from creditors, for the employees screwed. We want our money back from the bad times when Delta was bailed out NOW. Its the good times, so Delta needs to stop this psychotic pattern of screwing people and start to Man up and pay its bills, to respect its customers, its employees, its creditors, its government and even its sky-miles points account holders. Times are good, so stop this behavior Delta. There are no excuses this time.

  21. Their comments do give insight into how they view Delta miles. As a currency they can sell to 3rd parties and allow members to redeem at a rate such that the payoff is high enough for them to make profit. They must laugh at Lemmings who collect Skymiles. The use of miles as a reward for loyalty is outdated. It’s more of a marketing tool these days.

  22. @AtlantaAnne: Delta’s lowest pricing for ATL-LHR in business class is 62500 miles each way. So either you’re mistaken or Delta decided to suddenly get very generous just for you.

  23. I m a selfish guy. If I get the tickets I want that is my main goal. All the talk about Singapore Suites, Eithad Apartments, etc. I have never booked one of those awards. Many times I read some great trip report and at the end of it it says and by the way you can’t get these tickets any more. All these programs are changing like crazy. With that being said if you are flexible and have points in good programs, you should be ok. The goto program right now appears to be Alaska. But I did book ATL-JNB in business with Delta last year for 160K each business class, LAX to SYD next year 2 Tix 160K each business class. I also see continued availability on Virgin to LHR with no fuel surcharges from gateway cities at 125K miles. Now the MIA to LHR is an ancient plane that feels like 1970, but I think they have some better equipment in other cities. You don’t get as good access as Virgin members to those seats, but they have to pay fuel surcharges. AA tries to push you on BA and their saver space is in flux. Guys we are in a bubble. Tiny minority to the big picture. It is true that a small subset of members in these programs spend the majority of miles. My brother is thrilled to score 4 tix this summer in coach to Syracuse, NY for 40K each. He doesn’t care. The tix are 450 cash. I booked LAX to SYD for the same amount (160K). We got tons of Delta miles from business points and bonus points. He has also used miles to great vacation destinations like Cleveland, St. Louis to name a few.

  24. @Gary – off-topic – Just wanted to say thank you for your efforts, insights and sharing information in the points and miles world. I like to give you a hard time, but honestly VFTW has become a valuable resource and a daily read for me. I’m about to start the first leg of my next awesome vacation – First Class trip to Chile. Couldn’t have done it without you. Thanks man!

  25. With the effectual death of the Suntrust Skymiles debit card along with the disappearing charts and now this, I’m glad I’m about to book 6x MCO-GLA. I have enough for business class, but with a 7.5 hr nonstop, I’m not sure it’s worth it. May do it anyway just to burn the sky pesos. And I will no longer seek out DL flights or miles or waste hard pulls on DL cc’s. I’m done.

  26. @travelguru, I hope you’re wrong as I believe the intended audience includes all those that potentially fly delta, and I believe they are reading. Keep on hammering them Gary. I never get tired of it. Great points made.

  27. Does this mean no more pimping the Delta cards?
    To put your money where your mouth is…

  28. Bloggers often promote their favorite card ad nauseam. Their should be a campaign among bloggers to trash the Amex Delta continuously. Maybe DL doesn’t care what customers think but maybe they’ll care what Amex thinks.

  29. $187. Once you add in opportunity cost of miles not earned, it’s a redemption value of 1.75 cpm. I am super-happy to have a second option for shorthauls that gives solid value.

  30. I choose an airline based on safety records and reliability and because of that, I choose Delta. Don’t fly many international carriers because if the event of an accident, the other carriers’s country is your liaison. Nope I’ll pass.

  31. I live in Atlanta and fly Delta obviously. How does Delta credits miles if you are a member of Alaska frequent flyer program? Does upgrades work similar or you don’t even qualify to be on the upgrade list?

  32. It seems pretty simple to me. Our government, which cares nothing about it’s citizens, allowed the mergers that have now eliminated any real competition. So we now have 3 major carriers, with liars & whiners running them. The mergers also allowed Southwest to no longer be a discount airline because they no longer need to. So, in the end the American traveling public is screwed. Only answer for international travel is to fly anything Asian or Mideast. At least they still know airlines should be run. Europe? Not so much. They’ve mostly caught the American disease.

  33. this was the last straw,,, cashed in 800k miles, taking the entire family to Europe, and canceled four Delta sky miles cards,,, got Amex reward card in their place… done with Delta.

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