PROGRAM

Are loyalty programs a fool’s game?

Today is Frequent Flier Appreciation Day, better known as April Fool’s Day.

At least that’s the way hundreds of thousands of disillusioned United Airlines Mileage Plus members see it after their program was unceremoniously devalued last month. One of them is Ben Lawrance, who, for more than a decade flew on United or one of its Star Alliance partners “almost exclusively” to build and maintain his elite status.
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Can Capital One really “erase” my debts? And while you’re at it, could you do another rant about loyalty programs?

When Capital One offers to “erase” part of her debts with award points, Kate Morrical calls on a loyalty program skeptic to clear things up. Find out what happens next.

Question: You’ve gone on record plenty of times with your feelings about loyalty programs, so I wondered if you’d seen this ad for Capital One’s “Purchase Eraser.” In it, Alec Baldwin implies that he can “erase” a $700 purchase with 30,000 miles.

But the program overview clearly states that any purchase over $600 is 100 miles per dollar to redeem.
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Fly a mile, earn a mile? No, that would make too much sense

James A. Harris / Shutterstock.com
James A. Harris / Shutterstock.com
Looking back, Jill Constable’s mistake wasn’t flying to Australia on American Airlines and Qantas. The connections from Dallas to Sydney, Ayers Rock, and Cairns made sense, from a scheduling point of view.

It was the reason she chose the so-called “codeshare” flights.

“I wanted the miles,” she confesses.

Constable assumed that she’d receive credit for all of her flights to and from Down Under, plus the domestic flights booked through American. (Codesharing, for the uninitiated, is the fundamentally dishonest act of selling another airline’s flight as if it was your own, but I’m not going down that rabbit hole today.)
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Betrayed by a company? Here are 5 secrets for avoiding it

Kimberly Palmer/Shutterstock
Kimberly Palmer/Shutterstock

The call between Frank Alioto and his favorite cruise line went down like something straight out of a made-for-TV drama. You know that turning point where the hero actually turns out to be the villain? Just like that.

He and his wife, Susan, had accumulated 130,000 loyalty points over the years, using a special credit card called an “affinity” card that lets you earn more loyalty points, but can come with a series of unfavorable terms, like a higher annual percentage rate or a yearly fee.

“The program promises, among other rewards, that 125,000 points can be redeemed for a free five- to seven-day Caribbean cruise for two,” he says. And the Aliotos had collected for years, assuming that once they earned enough “loyalty” points, they’d get their promised cruise vacation.
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No more mileage runs? That’s bad news for everyone

Jozef/Shutterstock
Jozef/Shutterstock
It may be too early to write the obituary for frequent-flier mileage runs — those legendary year-end flights that offer a shortcut to an airline’s coveted “elite” status — but it’s easy to see the end from here.

With Delta Air Lines and United Airlines tightening their loyalty program rules in 2014 to require more spending in order to get singled out for special treatment, many of these frivolous round trips could vanish after this winter.

“With the new revenue requirements in place, mileage running will rarely make economic sense, except in cases where a traveler is just a few miles and dollars short of an elite threshold,” says Tim Winship, publisher of FrequentFlier.com.
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Are loyalty programs worth belonging to?

Aleksandar/Shutterstock
Aleksandar/Shutterstock
It’s time to question one of the most basic tenets of travel: Everyone should participate in an airline loyalty program.

A tectonic shift in the world of travel rewards is forcing passengers to reconsider their allegiances — or whether it’s worth being loyal at all. Given the already hopelessly convoluted nature of these programs, I’m surprised it took so long.

Frequent fliers have been hardest hit. In recent months, both Delta Air Lines and United Airlines revised their programs so that only the biggest spenders get the best perks. Soon, flying often won’t be enough to reach an airline’s coveted elite status. Expect more companies to follow.

Experienced travelers are taking a hard look at their loyalty portfolios. They don’t always like what they see.
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The next bubble? Travel loyalty programs

Lexarts/Shutterstock
Lexarts/Shutterstock

Did anyone pay attention when Robert Shiller warned about the real estate bubble or Nouriel Roubini sounded the alarm bells about the impending global economic crisis? Probably not as much as they should have. So feel free to ignore this one, too: travel loyalty programs — and particularly airline programs — are a bubble. And it may be about to pop.

All the signs are there. Delta Air Lines’ recent, precipitous devaluation of its loyalty program is just the latest. Your hard-earned frequent flier miles now die with you, and can’t be inherited by your next of kin. (Yes, Delta can do that.) This follows a wholesale downgrade of its SkyMiles program. Several hotel chains, including Marriott and Hilton, have also decimated their programs in the last few weeks.
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