Originally Posted by
lwildernorva
It's worthy of repeating: these loyalty programs have become their own profit center for hotel chains and airlines. Why? Because we all play by house rules, and the house rules can change at any time. And what are the house rules? You don't own your points and we can change the T&Cs of the program any time we want. That's a better situation for the airlines than Vegas. As a result, financial institutions have helped provide a good income flow to airlines through their loyalty programs. So, it's difficult for me to believe that FF programs only matter marginally.
In fact, I doubt that Deloitte would have pitched their proposal if they didn't see a chance to make a difference in something the airlines view as more than marginal.
Revenue-based programs are a two-way street: earning and redemption. You think Gary's business has a lot of folks who participate in Southwest's RR program?
And that's not just because Gary hasn't flown WN in over 20 years (as he likes to mention every week or so even while pumping the Chase CC) without understanding that for a domestic flight, the experience on WN is perfectly fine--mostly because of service and equipment degradation on the legacy carriers during that same time frame rather than because of marked improvements in Southwest's flight experience.
It's because under a revenue-based system, it's an easy conversion from how much a flight costs to how much it takes to redeem--there are no hidden sweet spots, there are no stopover rules, there are no free awards to tack on to the end of an international award. If the redemption ratio is 100 points per dollar for a fare, then a $100 flight costs you 10000 points and a $1000 flight costs you 100,000 points.
Even busy executives can trust their secretaries to take care of booking award flights under those conditions.
Ah, I see your point. I was thinking more along the lines of what some non-US carriers do in terms of a revenue-based system: giving only fractional or no miles at all for deeply discounted tickets, and full miles only on higher fare tickets.
You are absolutely correct that in a revenue-to-discount 'rebate' type system an award booking service would go the way of the buggy-whip.
I also agree with you that anyone who has not learned that the FF game is rigged and a long-term sucker's bet has not been paying attention. People tell me they have millions of miles they are saving for retirement or whatever and I shake my head in pity.
The best advice anyone can give to someone with points or miles is: "Smoke 'em if you got 'em." They will only go down in value over time. And they WILL go down in value.