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How Much Are Frequent Flyer Miles Really Worth?

MULTIZ321

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How Much Are Frequent Flyer Miles Really Worth?
By Dave Seminara/ The Getaway/ Travel/ The New York Times/ nytimes.com

"Merriam-Webster defines a mile as a unit of measurement equal to 5,280 feet. But in the increasingly byzantine world of frequent flier mileage reward programs, the term has little or no connection to physical distance. In 2015, United and Delta joined Southwest, Jet Blue and other airlines that award miles based upon ticket price and class, rather than distance traveled. American Airlines followed suit in August 2016.

I wasn’t aware of this reconfiguration when I booked a family trip to Australia and Indonesia on the United Airlines website last summer. I was seduced by the ticket price, $1,206 each, and the 21,393 frequent flier miles I thought we would accrue.

When I got home, I found the proverbial lump of coal in my United Mileage Plus account stocking: a paltry 2,120 miles earned for a six-flight trip that took us from Redmond, Ore., to Sydney, Australia, via San Francisco, with a side trip to and from Denpasar, Indonesia. I called United, assuming that they’d somehow left a zero off my mileage reward. “No, sir, 2,120 miles appears to be the correct reward for the trip,” the polite young woman who double-checked my flight activity said...."

18GETAWAY-master768.jpg

Wesley Bedrosian


Richard
 

MuranoJo

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Meanwhile, I could do my shopping on United Shopping and come out way ahead with ordinary purchases, if I watched for special incremental mileage deals. So you get mileage points for using your credit card, then you get bonus points for using the United Shopping portal--sometimes those bonus points are 8x+ for each dollar you spend.

Seems they'd want to reward actual fliers more than those using the card for non-flight purchases, but what do I know, ha.
 

isisdave

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It's probably better for them if you earn "miles" without actually taking up a seat.
 

MuranoJo

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It's probably better for them if you earn "miles" without actually taking up a seat.
Would you mind expanding on your suggestion? Maybe it's late and I'm tired, but it doesn't automatically make sense to me.
I thought all these people building up miles without flying--were a pain to the airlines, who in turn have to honor their programs and make at least some seats available to FF programs. Meanwhile, they're competing against the airlines' true loyal customers for limited FF seats.

Or does it have something to do with a kick-back the airlines get from the FF cards?
 

Jimster

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The minimization of actual miles awarded has been an on going thing for a least a year. Unless you pay for a ticket in a high fare bucket you are not going to get many miles or in the case of a partner the mileage can also be reduced. Your characterization of this as a lump of coal is accurate.
This is not true of all airlines especially Alaska Air but you must be very vigilent to plot in advance the number of miles you are going to get.

While this has become more popular lately, it also happened 15 years ago in some instances when you bought a low fare on a partner. I remember arguing with American about arguing about credit received while flying Iberia.

It is just another example of the airlines trying to find another way to maximize their profits while dumping the unsuspecting consumer. I am an advocate of letting Congress fair play if the airlines won't police themselves.
 

x3 skier

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From the article:

“But one could say you have no right to complain, because you got an unbelievable deal. This is how the world works now.”

I agree. I've been a member of FF Programs since they started. The world has changed and accruing miles is different than the past. I still fly mostly American now because it's usually the best routing for me and any miles I get is purely secondary. I'm down to my last 900000 and I've traveled to Europe countless times in Business and First Class. When those are gone, the party's over and I'll not complain.

Cheers
 

isisdave

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Would you mind expanding on your suggestion? Maybe it's late and I'm tired, but it doesn't automatically make sense to me.
I thought all these people building up miles without flying--were a pain to the airlines, who in turn have to honor their programs and make at least some seats available to FF programs. Meanwhile, they're competing against the airlines' true loyal customers for limited FF seats.

Or does it have something to do with a kick-back the airlines get from the FF cards?

Of course, when vendor X gives you miles, they have to buy them from the airline, which still has the seat they didn't sell you to offer to someone else.

I wasn't referring to kickbacks from use of the card, just the kind of thing where you get miles from car rentals or magazine subscriptions or who knows what else. Of course, they also get your annual fee if you sign up for their credit card.

Also, I think a lot of miles are lost to expiration, and more due to the need to pay the "anytime" rate rather than the "saver" rate due to planning too close to the travel date.
 

MuranoJo

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Got it. Thanks for the explanation.
 

jehb2

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American has made it so hard to get a frequent flyer ticket to Hawaii. But I had good run. For over 10 years we were able to use miles to fly to Hawaii.
 

WalnutBaron

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As others have previously referenced in other threads, I recommend The Points Guy. His entire website is devoted to best use of airline, hotel, and credit card points. At the beginning of each month, he releases a report estimating the value of those points from the various hotel, airline, and credit card companies.
 

Pathways

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Would you mind expanding on your suggestion? Maybe it's late and I'm tired, but it doesn't automatically make sense to me.
I thought all these people building up miles without flying--were a pain to the airlines, who in turn have to honor their programs and make at least some seats available to FF programs. Meanwhile, they're competing against the airlines' true loyal customers for limited FF seats.

Or does it have something to do with a kick-back the airlines get from the FF cards?

Of course, when vendor X gives you miles, they have to buy them from the airline, which still has the seat they didn't sell you to offer to someone else.

I wasn't referring to kickbacks from use of the card, just the kind of thing where you get miles from car rentals or magazine subscriptions or who knows what else. Of course, they also get your annual fee if you sign up for their credit card.

Also, I think a lot of miles are lost to expiration, and more due to the need to pay the "anytime" rate rather than the "saver" rate due to planning too close to the travel date.

Financial reports of airlines show up to 40% of their profits are now derived from simply selling miles to credit card companies. Definitely not a pain to the airlines
 

x3 skier

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As others have previously referenced in other threads, I recommend The Points Guy. His entire website is devoted to best use of airline, hotel, and credit card points. At the beginning of each month, he releases a report estimating the value of those points from the various hotel, airline, and credit card companies.

I get his daily email. Lots of junk but still worth it for the occasional nugget.

Cheers
 

bnoble

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“But one could say you have no right to complain, because you got an unbelievable deal. This is how the world works now.”

I agree. I've been a member of FF Programs since they started. The world has changed and accruing miles is different than the past.

I'm in this camp as well. I liked getting great leverage for low-fare/long-distance flights back in the day. But I don't really see a reason to complain that most airlines have shifted rewards to customers who spend more and are more profitable. If I were the airline, that's exactly who I'd want to be rewarding.
 

WalnutBaron

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From the article:

“But one could say you have no right to complain, because you got an unbelievable deal. This is how the world works now.”

I agree. I've been a member of FF Programs since they started. The world has changed and accruing miles is different than the past.
I, too, agree. That's the wisdom, actually, of the way the Hotel programs were originally structured--always based on actual dollars spent rather than nights spent at their properties. The airlines are trying to align their programs to operate more like the hotel programs--with miles awarded based on revenue per passenger rather than miles flown, and with multipliers and rewards targeted at Platinum members more than standard members.
 
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