Joe Brancatelli asks a simple questions about minimum revenue requirements for earning elite status:
Airlines have the right to create the terms of their programs as they see fit. But if they now base their programs on revenue instead of miles, why do they continue to demand a minimum number of flights and/or miles flown in addition to the dollar spend? After all, if the revenue you contribute to an airline’s bottom line is what counts, why does it matter how many miles or flights you fly?
Other questions that are rarely asked:
- Why don’t on-airport parking lots discount?
- Why do flight attendants have to pick up coffee cups they give you (for safety!), but not ones you bring onboard yourself?
- You can join the 40,000+ people who see these deals and analysis every day — sign up to receive posts by email (just one e-mail per day) or subscribe to the RSS feed. It’s free. You can also follow me on Twitter for the latest deals. Don’t miss out!
I saw JB’s post yesterday. It was a “light bulb” moment for me. Great point, just drop the miles/segments kabuki and base status solely on $$ spent.
That will really make most corporate international travellers “high status” but does not breed any loyalty.
I believe commenter #2 is on the correct path. “Loyal customer” is just a euphemism for “future revenue stream”. The airline is trying to identify the customers with the best chance of functioning as such. So they are applying constraints on both sides of the equation. The minimum spend requirement weeds out mileage runners who are only “loyal” to the lowest CPM, and the minimum BIS mileage requirement weeds out those who do a couple high-cost trips a year on the airline but aren’t really loyal to anything.
Other questions that are rarely asked Why do flight attendants have to pick up coffee cups they give you (for safety!), but not ones you bring onboard yourself? What a stupid question!!! and rarely asked except by you. Read the F.A.R.’s online at faa.gov….sheeesh
With the exemption given from high spend on credit cards, they have to have some way of not immediately granting top status (or premier plat in united’s case) to those flyers. Seems consistent with other EQM bonuses — spend will get you partway there, but not the whole way.
@frank Lorenzo: nice to see you’re still around after all these mergers. Unfortunately, you sure picked a bad week to stop sniffing glue.
I agree with CW
While the question has instant soundbite appeal, if you can linger for a second longer it is a bit silly.
The airlines are trying to incentivise people who actually fly with them, and who actually spend money on tickets, to continue to do so.
There are both flying and spending concerns with that, so they are trying to capture both parts.
The answer isn’t as appealing as the question to those with a microscopic attention span, but it is very obvious.
Qantas is doing EXACTLY that: they announced extending a set of status-holders’ perks to people who spend money on Qantas services and/or affiliated credit cards (it is called “Qantas Points Club”). They announced this back in mid-2019 with the launch day set for late 2019, which was later pushed to early 2020. Not much detail has yet been made available.
Press release is on (scroll down to Points Club section): https://www.qantasnewsroom.com.au/media-releases/qantas-rewards-frequent-flyers-in-program-overhaul/