While I can find my original post badly titled Sinkholes and Loyalty programs, I can't find the more aptly titled one about the 2015 Delta Skymiles program. (Some may say this is off topic, but I bet a lot of you fly Delta or Skyteam to get to your Marriott hotel.) I got InsideFlyer magazine today and was horrified to see the praise Randy Petersen gave to this Delta move; despite not knowing what the 5 tiers will be till late autumn or early winter; despite not being fully clear about how much we lose if we (as those of international travelers must) fly Skyteam partners to our ultimate destination; despite glossing over the fact that while miles simply counted, points will only be based on the actual revenue fare and NOT taxes. If anyone has looked at the tax structure lately on international fares, it is typically much more than the fare.
I am seriously disappointed, even to the point of considering cancelling my subscription since this was the main article ("Canary in the Coal Mine") and since I am mainly cutting my ties with loyalty programs so those little perks I always used to look for under Airlines and Hotels no longer matter.
This may not affect domestic flyers as much as it does international travelers, but I do not consider paying an average of about $1100-$1400 for a coach seat to Europe (with Plat Med Elite Plus Status) to be like a mileage runner. Again, I plugged in all of my international fares on Delta's calculator and I will now get a fraction of what I got before. KLM and Air France (we do know exactly by how much) will only count as partial points, and taxes (which are part of the total price and were calculated for miles) will not count at all, so those 11x base price matter very little to me (Plat +Amex) For everyone below Platinum, I think it's a complete loser.
So, unless the surprise part of Delta's package is really surprising in the 4Q (and do we really expect that?), I'm done after I use up my miles and my Platinum expires (because I am using my points rather than paying this year) -- oh, and BTW, it expires a month earlier than it did in the past -- end of January vs. end of February. And the SkyClub rates have gone up, you can bring fewer guests in (I never brought any, but for others this matters), etc.
I do not get where Randy Petersen is coming from unless he is excluding international travelers from the equation. But as all of you know by now, I may make idle threats about leaving Insiders once in a while, but come back. I don't make idle threats about leaving a loyalty program (or using it only when it's convenient rather than to rack up points).
Professor, you have unlocked the secret that all loyalty programs share: it belongs to the offeror, not the flier/customer, and as such it can be changed to the advantage of the company at any time.
As an article in the weekend's NYT so succinctly stated,
"This is one of those seismic changes that comes along in the world of customer loyalty programs every few years and prompts a couple of basic questions: What is the nature of this game that so many of us are playing? What does it mean to win now? And is it time to quit?
"Delta has been crystal clear about its two goals in its communications this week. First, it wants to reward its best customers. And its best customer by far is American Express, which is under contract with the airline to buy $675 million worth of Delta miles each year to give away to its credit card customers."
So unless you are an uber high-paying, no matter what it costs and gotta fly tomorrow flight booker, you are, in the words of the not so immortal Marie Antoinette, supposed to eat cake (without a utensil) because you are just an inconvenient loyal flier who does not meet their "new and improved" loyalty criteria. So there, na-na-na -boo-boo, as kids used to say. (now they swear like sailors).
I am not even so sure Amex will come out such a big winner, both because a lot of regular business flyers (I consider myself an irregular business flyers) don't or can't use it, but because when all the points become worthless, so does a $450 annual card. I use it to get double miles and lounge access. None of that will matter anymore some time after February 1, 2015, and so I will use my Sapphire card which gives me 2 points on ever travel dollar spent (even the bus to Boston).
You are right, anadyr, that it is the uberflyer who will win (the last minute business class traveler from JFK to, e.g., DC.) But even Petersen admitted there were anomalies in Delta's program he couldn't explain. And he predicted confidently that this was the way American will go.
I think we owe a whole lot of this to airline consolidation. Before that there was an incentive (that worked) for each airline to get as many people to join their FF programs as possible. While I have stood up for Delta, many if not most have referred to its redemption program as Skypesos.
Maybe this is a 'good business model' but I don't think they have a clue about the real repercussions once people see what happens. While (because Delta has made this so ridiculously complicated) you will still earn status based on miles (at least DELTA miles), you only earn points on the base fare, minus what they take away if you fly one of their partners. I imagine most flyers don't yet realize this yet, but when it hits home in January I think Delta may come to rue its decision.
Let's face it, the airlines have been giving away all and sundry miles for everything from shopping (which I have used) to hotels to car rentals and credit cards. But they have also benefitted enormously from people like me who refused to fly any other airline. Come next February, I will fly any safe airline to Europe.
Or they are us. The gist of Randy Petersen's article is that Delta sort of followed Southwest and one other airline's model (I forget since I fly neither) but changed odd aspects of it. If you look at the new Delta program it is amazingly complicated, and no one knows what anything will really be worth what with the partner issue, the tax issue, the different degrees of what you get x dollars paid for flight (mine are 11, second to highest, and I lose out by mostly more than 10,000 miles or more on every flight I flew to Europe and the Near East the last two years (I used their calculator scrupulously, and that part at least seems to be honest). And Petersen (I am utterly baffled by his take, since he has stood up for FFs these many years) admits since Delta will not release their supposed 5 - tier program for redemption till 4Q, that no one knows what anything will be worth.
So I'm flying business class the rest of the year, 5 flights booked already and am planning January travel soon and March when it's within a year and then I'll be gone.
Uberflyers (the few of you there are [I would guess the .00000001%] rejoice.
But if Petersen is right, Delta is setting the trend for all the others in the US. That's why I will look abroad first since KLM or Air France or Alitalia (my usual suspects) might just want to sweeten the pot for those relative few of us who only flight into and in Europe and beyond. If not, the travel sites it is!
We can give in mildly or we can speak with our virtual wallets. My wallet will be cancelling Delta (after I wring out every last mile) and cancelling American Express since Sapphire is better anyway.
It was a good ride till it wasn't.
I might be totally off base, but IAHFLYR, whether you think you're our expert or not, I consider you to be so. So weigh in.
Here's where I think the miscalculation went on Delta's end. Sure, they want to recoup revenues as much as possible, especially since they can't charge those of us at the highest elite levels for baggage fees, priority boarding, economy comfort etc.
What I think they are missing is that they are counting on a huge level of travel by the very rich. (I am not making this into a rich/poor thing, but I think Delta etc might be.) But people who can afford last minute horribly priced tickets in business class from say (to choose a different example) LA to Dallas are probably going to fly private jets.
Lowest level or occasional flyers won't care at all because they never get benefits. I suspect Silver get almost no benefits except occasional priority boarding. Where I think Delta is making its biggest mistake is hitting high Gold through high Platinums, especially internationally. That's where I don't think they've thought through the equation.
I am sure there are international flyers who pay to fly in business class (probably some Insiders). But I have gotten to know a lot of repeat flight attendants over the years and they have told me that most people seated in business class on an int'l flight are upgraded Diamonds and to a lesser degree nowadays Platinums, as well as crew members dressed in street clothing. Most of my recent int'l flights (3 to Italy in the past 5 months) have had business class less than half full. That's one of the main reasons I don't think this model will work.
We'll see, but I have my contingency plans firmly in place and by next January 31, before counting any flights I have yet taken I will have used 600,000 Skymiles for six flights, all but one in business (Edinburgh is the exception since it's such a short flight I opted for coach).
Woe are we!
I remember my earlier business days when I worked for large corporations and was issued an Air Travel Card, long before the advent of airline frequent flyer programs. The FFP have obviously helped airlines to develop "loyalties" by offering reward miles, million-mile gift and lifetime "Silver" status, although they continually find ways to modify these, often to their own benefit. I formerly concentrated on Delta, NW and US Air, before consolidations, but now primarily fly Delta. I use a Platinum Delta American Express Card for airline and other purchases to multiple flight miles, just as I do with Marriott Visa Signature Card for additional hotel points, and both of these continually increase annual fees.
If you're not already using a Marriott Visa Signature (Black) Card, you might consider the merits of this, even though annual fee is a bit high:
* DON'T FORGET TO MENTION I REFERRED YOU!
Reason: I have to fly out of Atlanta, and what other airline provides the best connections (domestic or international)?
Choosing an airline, I think, depends on not just reward programs, but which airport is most convenient for the traveler; that's why I primarily fly Delta. If I were in Charlotte, it would probably be US Air; Chicago, United or American, etc.
I'm not particularly upset by the latest Delta changes; I'm only thankful they have seemingly corrected their financial woes and my accumulated, reward miles are not in jeopardy at this time. Generally speaking, I've been pleased with Delta accommodations and service.
I would agree that the changes will not impact everyone. And I also see Delta's long-range strategy to reduce the burden of miles being earned. However, if this Delta change gets in place and there is no wholesale bolting from Delta to other airlines, the other big two will make the same adjustments, effectively deconstructing mileage earning programs as we know them.
Delta has backtracked for the second time on its draconian changes to the 2015 and 2016 Skymiles program and its perks (or lack thereof). They already backtracked on upgrades for most coast to coast flights, and now they're backtracking on Skyclub privileges (such as they are):
My hope is that when people start seeing the immediate impact of the changes (like how many miles they don't get), there will be more responses and reactions. DELTA=GREED (and overreach) as of this year.
Even though I couldn't see my new Delta post I found it by going back to the original. I was commenting on how Delta is starting to pull back on its draconian changes, albeit bit by bit: