Originally Posted by
dcpatti
While it may be a controversial program, it's quite possibly more profitable to sell the status uplift than to sell a cheap transcon to someone who is short of the next level qualifications.
More profit if you look only at immediate short-term effects (revenue in for buy-up vs opex for flight). FF programs drive profit on multiple levels. E.g., they generate immediate revenue from wholesale mileage to CC and other partners, they incentivize passengers to be loyal to attain status and hence upgrades and other perks. As in so many areas, this is a balance. Emphasize immediate revenue and you dilute the elite ranks and may drive away hugely profitable passengers. Same for skimping too much on upgrades and award seats. (E.g., AA has publicly available award seats, "hidden" award seats for top-tier elites, and on-request award seats that may be released based on who is asking.