It seems to me that the international carriers are seeing a modestly improving economy, and are crea

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[I]t is not a matter of if the legacy carriers will follow the current trend, but when. I m comfortable saying that at least one or all of the remaining legacy carriers will have announced a change or conversion to a new normal of how miles and other travel currencies are earned and burned within a year.
Let s be realistic, many don t place Southwest Rapid Rewards in the same category as other legacy carriers such as American and United. hotels on the riverwalk san antonio But the fact is they are one of the largest domestic carriers and as such actually have one of the largest frequent flyer programs. Granted, its appeal and practicality isn t for the global warrior and upgrades aren t even listed hotels on the riverwalk san antonio in the in-flight menu. But nonetheless, they did make the change, and as strange as it seems to some, painful adjustment aside, they seem to have not lost members of that program to competing carriers.
Not if, but when the same happens to legacy hotels on the riverwalk san antonio carriers, there will be a larger adjustment for many to make. But keep in mind, it s a change to the currency of the programs, not a change to the benefits and practices of the programs.
the idea has now gained substantial traction with Southwest s adoption and the rumors of Delta and US Airways following suit, as well as American and United. I can t imagine any reason why any of the legacy carriers haven t done some sort of research and developed contingency plans to adopt this new normal.
.. I feel a change comin and whether we like it or not we ll have to get on board. But until we see what it really looks like in a legacy program, the stress and anxiety is wearing on us here at InsideFlyer.
My own bet is that Delta does this, announced in 2013 for 2014 roll out. Others think this is coming more quickly, and Delta has certainly shown themselves willingness to make changes to their program without notice I do not believe they would purposely generate the customer confusion that would come from doing this out of the blue. So my guess it happens, just not immediately. It s certainly been rumored for awhile .
I also don t think it s coming down the pike with the rest of the legacy carriers as quickly as Randy seems to imply. They re generally preoccupied with other matters, many of them do hop onboard and mimic each others changes once a program takes the plunge, but for something of this magnitude I have to think that other programs would be foolish not to step back and watch how things unfold for the first legacy program adopter.
hotels on the riverwalk san antonio In that piece what I had in mind was the Southwest, JetBlue, and Virgin America model of earning a certain number of points based on your spending and redeeming those points based on the cost of the ticket. You get airline scrip on some sort of fixed rebate model, and that scrip can be used as cash with the airline.
hotels on the riverwalk san antonio That s not the only way to do what might be called a revenue-based program. And the devil in all of this is going to be in the details. If all programs hotels on the riverwalk san antonio did is increasingly bonus higher revenue fares (United already did this with changes to their program for 2012) and provide the option to book any seat desired with points hotels on the riverwalk san antonio at a fixed-value per point based on fare (in parallel to the award chart) this would be no big deal.
American offers something like the latter ( Dynamic Air Awards ) for its elite members only, presumably hotels on the riverwalk san antonio they rolled it out as a trial. United rolled out Choices to its co-branded credit card holders some years ago, it still exists but hasn t gotten much marketing attention in awhile. Delta has pay with miles for co-branded credit card holders hotels on the riverwalk san antonio as well already.
Expanding these options as long as these don t replace hotels on the riverwalk san antonio the award chart, or coincide with greater restrictions on inventory at the saver level would be a modest improvement in the eyes of some members. Not me so much, since at the point where I m receiving foxed-point value I m not longer interested, you no longer combine the rebate from travel or credit card spend with the leverage of the mileage program s bulk purchase of distressed inventory that allows you to take a small number of points and turn them into the sort of aspirational travel that would otherwise be out of reach. In other words, taking away the award chart that allows consumers access to the sort of value that s currently offered hotels on the riverwalk san antonio takes away the romance and allure of the programs and undermines their value proposition.
The key details to watch are hotel partner awards are priced, to the extent that airlines are still able to purchase those at a deep discount. If Delta adopts a revenue-based program, will they allow their points to be used at the same fixed value on partners like Korean and Czech to acquire revenue hotels on the riverwalk san antonio tickets? (And shouldn t those tickets earn miles ?) Other airlines around the world would -still be offering saver award inventory. Will Delta custmoers continue hotels on the riverwalk san antonio to have access to that inventory? And at what price?
How will earning from non-flight activity be treated? We have some clues from credit cards and other partners of programs like Southwest, JetBlue, and Virgin America although in general those programs hotels on the riverwalk san antonio have fewer partners hotels on the riverwalk san antonio than the legacies do. Certainly the co-branded credit cards of these airlines (big Southwest signup bonuses notwithstanding) are far less rewarding than their counterparts at United, American, hotels on the riverwalk san antonio or for that matter the hotel programs.
It will be interesting to watch if airlines move in this direction, ultimately gutting the value proposition of the credit hotels on the riverwalk san antonio card companies that are crucial to their survival. Alaska Airlines takes in 10 times as much revenue from selling miles to Bank of America as they will make or lose in a single hotels on the riverwalk san antonio year as an airline. Both United and Delta pre-sold over half a billion dollars of miles to their credit card sponsors in order to provide liquidity. United s debtor-in-possession financing and bankruptcy exit financing was provided by its co-branded credit hotels on the riverwalk san antonio card issuer. The banks hold massive sway here. It s possible they just go along with change, or are convinced that change is good. But I ll be curious to see how this plays out.
The hybrid model of fixed value redemptions OR award chart redemptions would not be bad. My main question is: what will airlines do with premium international seats if their currency is fixed value? No one will want to redeem hotels on the riverwalk san antonio one million points for a trip in international first.
A big reason Southwest would not have been affected adversely in terms of program loyalty is that people active in that program never were those interested in aspirational travel first class seats, trips to worldwide destinations, great hotels. If you were ever focused in the Southwest program you were after free domestic hotels on the riverwalk san antonio seats on Southwest very worthwhile hotels on the riverwalk san antonio to many, but not at all what many people are after in the United, American and other legacy airline programs.
So the other airlines could hardly see that as a model. If United were to follow the Southwest model, I d be all in with American in a minute, and vice versa, since they both serve my home airport hotels on the riverwalk san antonio equally well. The first legacy carrier to adopt this model will see a significant exodus to its rivals.
Although you believe that revenue-based models would be very bad for the airlines, they all seem to feel such a model would be a substantial improvement for them. So that comes down to whether you believe that the industry as a whole is run be competent people who are able to make rational hotels on the riverwalk san antonio business decisions or a bunch of self-destructive nudnicks.
Finally, while a revenue based program _might_ damage the loyalty of existing aspirational customers I presume the airlines would still retain their elite status systems. Isn t that, really, the major driver of loyalty? What if the redemption value were substantially better for elite customers?
It seems to me that the international carriers are seeing a modestly improving economy, and are creating a constrained supply. They are improving their premium cabin competitiveness at the same time. Their hope must be that the front cabin fills faster with revenue fares and there is some evidence that this is happening.
In that context, where the airlines have some confidence that they can actually sell business class seats, and a time horizon where they might be able to sell First Class on the few routes where that still flies, then I can see that the premium mileage awards on those seats will increase further. Or, same difference, the awards in economy decline. Ultimately hotels on the riverwalk san antonio what they want to do is align the rewards with the profitability to them of taking those passengers. I don t see that revenue is the key here. A cheap seat from SFO to SYD may not be profitable at all in $ terms than a relatively expensive seat from SFO to SAN so I would imagine that they will want to incent the more profitable fares. The only sensible way of doing this is to offer mileage gradations by fare class.
How this comes about is more difficult. The howls of protest hotels on the riverwalk san antonio will be huge from infrequent flyers, so I would guess that it will be done by inflation at the top end, rather than diminution at the bottom. It s possible also that the distinction between miles and elite qualifying activity will be magnified. But I should also imagine that the ultimate aim will be significantly less value to be earned hotels on the riverwalk san antonio from deep discount fares.
On the redemption hotels on the riverwalk san antonio front, I should think that the only real issue at present is managing the expectations of mile holders managing those expectations downwards to not expecting seats to be available nearly as often as was the case wh