Part 2: The art of mastering airline loyalty programs -- Going for Elite
Part 2 of 2 on airline loyalty programs: How to master your own loyalty portfolio
Last week I talked about how airline loyalty programs are making a comeback. To piggy back on that, I wanted to offer my perspectives on which are the best programs and how you can master your own portfolio.
You may have seen lists out there for how best to maximize the value of your miles, but I wanted to focus how to maximize the value of the program, so that you can make the most of the overall experience in addition to the just using miles.
First off, here are my golden rules:
1) Never ever fly without earning miles. Even if you're on a new LCC you've never flown before, you may as well sign-up. You never know when those miles come in handy down the road if you fly them again (or not). It's just too easy not to.
2) Only belong to one program per major alliance. This way you can consolidate miles. Since you can earn and redeem on any carrier within an alliance, there's no need to have points across programs. However, it's always best to keep your points in the carrier you fly the most. Then you can use those points for upgrades and some other perks that might only be available to members of that program.
3) Pick a "dominant" program for you to focus on. Usually that will be the program of the airline you fly the most. If you're someone like me who moves around quite a bit, it might change based on where you live (I've migrated from Delta to US Airways to American to now United/Continental over the last 7 years). Ideally, you're not like me and you can focus on the same airline for several years running. Sign-up for all the alerts for this program so you know when there are mile specials and bonus point opportunities. Get a credit card of this program also so you can get the quick hit of 25k or 30k miles when you make your first purchase, and use it for purchasing tickets on that airline when you usually get 3-5x mies per dollar.
4) Go for Elite. That is the whole goal of airline loyalty. Yes, getting lots of miles is good also. But it's true they are hard to use, and while you can make good use of them to get magazines, upgrades, and travel -- loyalty programs can offer so much more. But they don't offer anything until you have status. Elite status gives you the ultimate travel experience. Even at the lowest tier, you generally get: Priority check-in, priority security, priority boarding, better seat selection, priority baggage, no baggage fees, special phone number for better service, need I go on? Talk about taking so many of the hassle points out of the travel experience!
My recommendation is to always go for elite. That means consolidating all your travel into one alliance, even if it costs a bit more from time to time. Ideally you've chosen the airline that offers you the most non-stop destinations that you frequent and competitive fares. But even if you have to pay a little more on occasion, think of the value of obtaining elite. Free baggage and perks like economy plus seats on United have actual real costs that you might pay for otherwise. You have to figure out how much elite is worth to you, but I'd hazard for lots of us out there (even only semi-frequent fliers), elite status is worth several hundred dollars over the course of a year. So why not put some of that benefit back into slightly more expensive airfare to get you on your favorite airline? It's a trade-off, but I think it's well worth it when you have to ante up an extra $20 or $50 here and there to make that happen.
Now, a lot of you out there might be thinking that you don't fly enough for elite status. That may be true, but when you consider all flights you take in a year, not just the ones on a specific carrier, you might be surprised how many miles you really fly. Base level elite status is 25k flown miles in one calendar year on nearly all airlines. Round trip LA or SF to NYC is 5k miles. So that's only 5 round trips coast to coast in a year. LA or SF to Europe is 10-12k miles r/t depending on routing. Do that twice and you're pretty much there. If you fly only up and down the west or east coasts -- yes, it might take A LOT of flights to make that happen. But if you happen to have a trip to Europe one year, it might push you over with your other domestic travel.
The other thing is you never know when you might have to fly. Trips tend to crop up, and if you're prepared by consolidating your miles, you won't miss out when a trip comes up late in the year and you haven't accrued enough miles in one place to make elite status a potential. Remember that elite status is based on a calendar year of miles -- Jan 1 to Dec 31 -- so it's best to keep that in mind and always start fresh at the beginning of the year. Finally, airlines now offer incentive to help you get to elite status faster. Some of them have credit cards where if you spend enough, you can earn EQM (elite qualifying miles). Additionally, if you're close to elite at the end of the year but don't quite make it, you are likely to get a marketing solicitation from the airline where for a cash payment or maybe one more flight on the airline anywhere (even a short hop), they'll give it to you. Additionally, there are programs like American AAdvantage's Challenge Program. It lowers the threshold for elite if you travel a lot on American in a short amount of time. If you call up an AAdvantage rep and tell them you want to sign-up for the challenge, it means you have 30 days to complete a certain amount of travel and they'll give you automatic elite (e.g. 5 or 10k miles in 30 days). Note they don't advertise this or promote it anywhere, you just have to call and ask!
Finally, Elite status isn't officially transferrable, but once you have elite on one airline, you can sometimes ask other airlines to match your status level. Call up and ask -- you usually have to fax or e-mail over a copy of your elite card from one airline before they comply with your request. It's well worth it to spread your benefits!
Finally -- my take on the best choice of program. Here are my criteria:
1) Points vs. Miles: Some programs use points, which are generally pegged to a monetary value or some set segment amount. These programs are often more flexible, but I find I can extract more value out of real mile programs. Additionally, when you fly long segments, you should prefer miles since you get more for your buck spent. So this means AirTran, Southwest, JetBlue, and Virgin America are out of the running (note Virgin and JetBlue also don't have elite status, so that's a definitely no-no anyways since clearly I view that as the best part of the program).
2) National network: This depends on where you fly, of course, but choose the airline that flies to your city the most and has easy connections for you. For example, don't choose US Airways if you live in Chicago. Similarly, don't choose Continental if you live in San Francisco. I'll leave this as a custom criteria.
3) Alliance: Especially if you travel abroad, find the best group of airlines for your international travel based on alliances. Personally, I choose Star because of Singapore to the far east and Lufthansa and Air Canada expanding options to Europe. SkyTeam is also compelling with KLM/Air France for Europe, and of course One World's newly merging British Airways and Iberia and anti-trust immunity with American mean great things for them also (plus Cathay to Asia and Qantas to Australia).
4) Airline specific perks: A lot of airlines offer a lot of the same service. But I've made no secret here than I'm a huge fan of the Economy Plus product on United. And an extra benefit is that it comes free with elite status. I also love Continental's overall product and service, so it's an added benefit that they're in Star even though I don't fly them that much living in San Francisco.
Verdict: Miles + SF hub + Star Alliance + Economy Plus = United Mileage Plus.
For you, it might be different. But follow the rules above, and whichever one you choose -- go for elite. I know a lot of people think they can't make it, but I'd hazard more people can do it than you think. And if you really don't fly anywhere near enough to make elite, than perhaps all the perks that come with it just aren't that important to you!
Feel free to offer your favorite program, tips, and tricks in the comments below. And if you won't make elite in 2010, gear up for Jan 1 2011 when all elite qualifying mileage balances reset to zero!
Posted by Evan
