frequent flyer

Tag Archives for frequent flyer.

How Much Does The Value Of a Frequent Flyer Mile Change During The Current Crisis?

by Gary Leff on April 11, 2020

Apr 11 2020

These are the broad factors need to be taken into account when estimating the change in value of a mileage currency, and they’re likely to apply differently to each program based on, among other things, the tendency to print miles and the financial stability of the program in uncertain times.

We need to be thinking about how much we value miles – and how much they need to change – recognizing that there are forces pushing the value both up and down at the same time.

People Are Still Buying 100 Million Frequent Flyer Miles A Day

by Gary Leff on April 11, 2020

hand holding hundreds of dollars in cash

Apr 11 2020

Points.com says people are still buying on average 100 million frequent flyer miles a day.

And at an average of, say, 1.5 cents per point (hotel points generally go for less than airline miles) that’s just $1.5 million per day across all of those programs. What they haven’t told us is how the 100 million points total compares to what people were buying before. I’m guessing the mileage sales business is down by half.

U.S. Government Might Take Frequent Flyer Programs As Collateral For Bailout

by Gary Leff on April 8, 2020

Apr 08 2020

If airlines are going to receive a bailout, taxpayers should receive some assurance of recovering the funds when times are good. And any deal should be structured to incentivize airlines to get out from under partial nationalization as quickly as possible.

The Treasury Department is asking airlines seeking bailout funds to detail the economics of their frequent flyer programs as one source of collateral.

How Frequent Flyer Programs Will Save The Airlines

by Gary Leff on March 20, 2020

Mar 20 2020

Airlines will be able to lean on their loyalty programs both for short term cash, and to put butts back into airline seats as soon as fear subsides.

They have a history of turning to their loyalty programs as cash cows – either spinning off the business or pre-selling 9- and 10-figure dollar amounts worth of miles to their co-brand credit card issuing banks. They can sell miles at a discount now to passengers who will redeem them later. And there’s never been a more effective marketing vehicle than the frequent flyer program for influencing consumer behavior, just as soon as behavior can be influenced again.

Why American AAdvantage Is Better Than MileagePlus And SkyMiles

by Gary Leff on December 6, 2019

Dec 06 2019

I’ve been a frequent critic of American Airlines, and that’s largely because I believe no U.S. airline has greater potential to be better than it is today than American. I’m also frustrated with many things about its loyalty program, AAdvantage, but when I sit down to compare AAdvantage to the programs offered by United and by Delta it actually comes out ahead. Here’s why.

Why Spinning Off Frequent Flyer Programs is a Bad Idea

by Gary Leff on November 2, 2019

Nov 02 2019

On Wednesday morning I debated Stifel Managing Director Joseph DeNardi on whether or not to spin off frequent flyer programs at the Airline Information MEGA event in Florida.

Joe is the best-known face of the argument that loyalty programs are the primary drivers of revenue and value for airlines, and he’s argued that the overall businesses are undervalued because investors don’t clearly see how much good, high margin revenue is coming in from credit card partnerships versus from the airline as old-line industrial. He was charged with defending the idea of spinning programs off into a separate business, and I was charged with arguing against this.

Climate Activists Have a Really Dumb Idea: Banning Frequent Flyer Programs

by Gary Leff on October 14, 2019

Oct 14 2019

The drive to ban reward travel confuses the average and marginal effect of flying on the environment. Saver award travel has, by definition, the lowest environmental impact of any flying. Airlines make saver inventory available when they’re flying anyway and they believe a seat won’t sell.

USA Today Columnist Wants to Ban Frequent Flyer Programs, Blames Them For Everything Wrong With Travel

by Gary Leff on September 28, 2019

Sep 28 2019

Forget about bad opinions, for over 15 years Christopher Elliott has been writing columns that get their facts wrong. His pieces haven’t gotten any better as the years have gone on.

He keeps making weak arguments that attempt to use air travel as a vehicle for his claims about social inequality (even when the details don’t work, especially since loyalty programs give customers access to perks that would normally only be available to the wealthy) and telling readers to quit frequent flyer programs for years without correcting his errors or updating his facts.

Qantas is Seeing a Run on Redemptions Prior to Award Chart Devaluation

by Gary Leff on June 28, 2019

Jun 28 2019

Lower coach award prices are translating into greater redemptions for coach travel. That’s exactly what you’d expect. However it’s the changes in redemption patterns that are happening when prices have not (yet) changed that’s most revealing.

New Data-Driven Look at Which Frequent Flyer Programs Have the Best Award Availability

by Gary Leff on June 27, 2019

Jun 27 2019

The takeaway from the IdeaWorks study is that overall airlines have been making more economy award seats available at lower prices, although not all airlines do a good job at this. Here’s who’s best.