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Alaska Selling Miles: How Much Do They Really Make?
I’ve just noticed over the years how often AS sells miles. Obviously this is a treasure trove for mileage brokers, and a great deal for actual frequent flyers of the airline. I’m glad they limited it to 150,000 for non-elites, and I wish they’d take further steps. Like only allowing non-elites to book J if they’re going to dilute the market and space so much with their miles.
But given how much fraud occurs, and their partners getting slightly P’Oed (hence what I think ultimately lead to the EK increase) why does Alaska always sell these miles constantly? Obviously it’s accounting for a pretty penny of their bottom line or they wouldn’t be doing it. But can’t there be a better way to do this than the way they’re currently executing it? For approximately $2,000 I can get a $30-$40,000 EK F seat, so it’s a terrific value and I love to take advantage of it. But shouldn’t that opportunity be limited to their most valued clients? I just wonder what the cost is, how their partners feel about it, the dilution of their “currency,” the fraud, and other aspects of it? Is it worth it? Are there further steps they could take to actually let the people who legitimately earn the miles the hard way have a leg up? I personally don’t like the fact that if I’m a 75K, I’m constantly going out of my way to give AS my business and money, and collect their miles. Only to have them be so diluted and space gone because they sell these miles. A large majority of which I’m sure ends up with mileage brokers. I feel slighted by this because I worked hard to earn these miles and now the space isn’t there because every Tom, Dick, and Harry have access and ability the same as me. Except I’m actually loyal to the airline and the purchasers just stumbled upon a good deal. I realize I’ll probably get a lot of people who take advantage of these deals yelling at me, and that’s fine; I’m more interested to hear from actual AS flyers. But do other elites also feel a certain sense that AS doesn’t care about you when they’re constantly giving out their miles and then having to limit your space on partner bookings? I just think a 75K/Gold bucket reserved for their top-tier elites on partners would be a good idea to keep the flyer who gives them the most dollars happy. And not some Asian blogger who found out a loophole and is taking full advantage of it, which is what happened/happening. |
Originally Posted by NWplatinum
(Post 31742723)
Obviously it’s accounting for a pretty penny of their bottom line or they wouldn’t be doing it. But can’t there be a better way to do this than the way they’re currently executing it? For approximately $2,000 I can get a $30-$40,000 EK F seat, so it’s a terrific value and I love to take advantage of it. But shouldn’t that opportunity be limited to their most valued clients?
(Also, EK doesn't expect to get 30-40k USD if they put a seat into award inventory, that's the entire point of award inventory- get more than $0 when the seat goes empty, because it's likely to go empty.)
Originally Posted by NWplatinum
(Post 31742723)
I personally don’t like the fact that if I’m a 75K, I’m constantly going out of my way to give AS my business and money, and collect their miles. Only to have them be so diluted and space gone because they sell these miles.
So, since apparently it's not enough: do you get mad that AA sells miles to multiple banks, and that a few credit card signups means that anyone can book JL F or EY F, just like how someone can buy AS miles to fly JL F or EK F? Do you get mad that someone can use AMEX MR from signups to fly EK F or JL F using Skywards if they want? Or is your mad only limited to AS because if the transaction some churner makes is washed through a bank you don't feel so bad about it? Keep in mind that churners/MS means that those people paid $0 for those airline tickets (well, maybe opportunity cost of using a 2% cashback card... except for the bonus). Someone who does that is "diluting" your opportunities too, just like someone who hands over $2000-3000 USD to AS for a pile of miles. Oh yeah, AA miles are available for purchase at ~the cost of AS miles. On the regular. Does that also devalue your AA EXP experience? Do you want AA to have an "sit in J on an award unless you're an EXP" rule too?
Originally Posted by NWplatinum
(Post 31742723)
feel a certain sense that AS doesn’t care about you
Originally Posted by NWplatinum
(Post 31742723)
I just think a 75K/Gold bucket reserved for their top-tier elites on partners would be a good idea to keep the flyer who gives them the most dollars happy.
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Originally Posted by eponymous_coward
(Post 31743000)
Ah, now it's the Classic Flyertalk move: "I want the rules changed to benefit ME".
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Originally Posted by Visconti
(Post 31743361)
Dude, took me a while, but now that I've finally gotten into the spirt of FT, I'm all for this. Now that I'm 75K, fully on board with whatever measures that benefit me, while making it more scarce for others.
Sound good? |
I have never bought AS miles. Guess when I run out next year and don’t make as many new ones as a lowly MVP (vs Gold this year) I should look into buying miles for my discounted premium travel. Thanks, OP! :cool:
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Originally Posted by eponymous_coward
(Post 31743390)
We could have beatings as passengers enter the plane, they would use clubs on non-elites, smaller ones used if you’re wearing a #3 Seahawks jersey or have the credit card, a slap to the face if you are MVP, a too-tight bone crushing handshake that makes you wince for Golds, and a red carpet and deep curtesy with trumpet flourish and 21 gun salute if you’re 75K.
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A miles or ticket purchase from AS is a simple business deal. Nothing more or less. You are an AS customer, not an AS BFF.
If you dislike AS, its business model, and its hard and soft product and are still flying AS, you are a marketer's dream come true. If the grass is greener somewhere else, fly that carrier. More and more people do that and wind up better-satisfied. |
Originally Posted by eponymous_coward
(Post 31743390)
We could have beatings as passengers enter the plane, they would use clubs on non-elites, smaller ones used if you’re wearing a #3 Seahawks jersey or have the credit card, a slap to the face if you are MVP, a too-tight bone crushing handshake that makes you wince for Golds, and a red carpet and deep curtesy with trumpet flourish and 21 gun salute if you’re 75K.
Sound good? |
Originally Posted by eponymous_coward
(Post 31743000)
It's a commercial transaction that the airline does because they think it's in their best interest, just like you buy miles when it's in your best interest.
(Also, EK doesn't expect to get 30-40k USD if they put a seat into award inventory, that's the entire point of award inventory- get more than $0 when the seat goes empty, because it's likely to go empty.) Why are you giving an airline your business if it's not a good deal for you? Your profile indicates that you do something on the order of 300,000+ miles of butt-in-seat flying on paid tickets every year: EK Plat (150k+), AA EXP (100k+), AS 75k (75k-90k). You're earning plenty of miles and you should be getting some EK op-ups as well. You have AA SWUs. You're getting that 50k AS bonus. Are you seriously telling us it's not enough, and all the little people are getting in the way of your Krug and Dom with showers at 35,000 feet? So, since apparently it's not enough: do you get mad that AA sells miles to multiple banks, and that a few credit card signups means that anyone can book JL F or EY F, just like how someone can buy AS miles to fly JL F or EK F? Do you get mad that someone can use AMEX MR from signups to fly EK F or JL F using Skywards if they want? Or is your mad only limited to AS because if the transaction some churner makes is washed through a bank you don't feel so bad about it? Keep in mind that churners/MS means that those people paid $0 for those airline tickets (well, maybe opportunity cost of using a 2% cashback card... except for the bonus). Someone who does that is "diluting" your opportunities too, just like someone who hands over $2000-3000 USD to AS for a pile of miles. Oh yeah, AA miles are available for purchase at ~the cost of AS miles. On the regular. Does that also devalue your AA EXP experience? Do you want AA to have an "sit in J on an award unless you're an EXP" rule too? It's a series of commercial transactions involving a corporation who has a duty to shareholders to make money running a business. There is no "care" here beyond what makes business sense. Don't let the shiny card with the precious metal on it fool you about that. Ah, now it's the Classic Flyertalk move: "I want the rules changed to benefit ME". The airline's out to make money, they'll change the rules to make more money, not to make people happier regardless of financial impact. You're free to walk to an airline that treats you right- someone who flies 300k+ a year with lots of international travel could easily walk to AF or LX, where their F cabin is unbookable except by a top elite (and apparently really spiff). Note that AF and LX don't sell miles like AS does (as well as having actual longhaul F cabins and lounges that are real "first class" experiences, not borrowed ones like AS does)... if you're really about the exclusivity of the experience, those sounds like good opportunities for you. |
Originally Posted by NWplatinum
(Post 31745178)
Thank you for the book response. I’m not mad, I’m just asking a question.
Not suggesting this is what AS is doing, but, if I were running the outfit, I'd love the free cash flow created by selling a fiat currency where I can devalue at any time (not to mention refuse to honor in cases of brokering) and for whatever reason. While this may not be appreciated by their partners or elites, it's essential for AS to increase FCF as a buffer, especially given the potentially cyclical nature of the business and their, at his point, possibly overpaying for VX. Personally, I love competition and fervently hope ALK's VX purchase will work out in the long term, since I'd hate to be reduced to just the big three. And, as a 75K, I will rebook all of my transcons to AS and likely have a significant amount of AS metal flights in Q4 and 2020. So, in my case, the VX Gold match and partner miles will translate to my using AS as my primary domestic option moving forward. |
Originally Posted by Visconti
(Post 31745202)
Jokes aside.
Not suggesting this is what AS is doing, but, if I were running the outfit, I'd love the free cash flow created by selling a fiat currency where I can devalue at any time (not to mention refuse to honor in cases of brokering) and for whatever reason. While this may not be appreciated by their partners or elites, it's essential for AS to increase FCF as a buffer, especially given the potentially cyclical nature of the business and their, at his point, possibly overpaying for VX. Personally, I love competition and fervently hope ALK's VX purchase will work out in the long term, since I'd hate to be reduced to just the big three. And, as a 75K, I will rebook all of my transcons to AS and likely have a significant amount of AS metal flights in Q4 and 2020. So, in my case, the VX Gold match and partner miles will translate to my using AS as my primary domestic option moving forward. i get the cash flow that’s great. But there’s so much devaluation to the AS miles i’m earning, what’s the point of me earning them if DL is more convenient? If I want an award I’ll just buy AS miles. |
Originally Posted by NWplatinum
(Post 31745211)
But there’s so much devaluation to the AS miles i’m earning, what’s the point of me earning them if DL is more convenient? If I want an award I’ll just buy AS miles.
If I were starting to fly today absent of Elite status with any airline, I'd probably choose DL. OP wise, I think they're the best and offer the general consumer the best bang or the buck--again, absent of any rewards or elite considerations. Disc - Personally and institutionally own DAL. PS - While this was almost a decade ago, post 08, most of us would just buy miles, rather than paying for flights. Still makes sense today, but the availability certainly wasn't what it had been. Unless the carriers find a way to narrow this arbitrage, it most assuredly makes more sense to buy miles rather than paying $$, in my view. |
A “simple question” consisting of five paragraphs and including suggestions on program changes.
Whatever you say. Again, your profile says you fly enough miles that programs with truly exclusive F cabins are well within your reach. Fly DL and AF, crediting to AF Flying Blue, achieve Platinum (draw down your AA/EK flying if need be), you’ll never have to worry about a lowly FB Silver flying in an AF F cabin. No mileage sales. Exquisite ground experience in CDG. LX works the same: SEN or better to book F. Is that short enough? |
Originally Posted by eponymous_coward
(Post 31745313)
A “simple question” consisting of five paragraphs and including suggestions on program changes.
Whatever you say. Again, your profile says you fly enough miles that programs with truly exclusive F cabins are well within your reach. Fly DL and AF, crediting to AF Flying Blue, achieve Platinum (draw down your AA/EK flying if need be), you’ll never have to worry about a lowly FB Silver flying in an AF F cabin. No mileage sales. Exquisite ground experience in CDG. LX works the same: SEN or better to book F. Is that short enough? |
Alaska Selling Miles: How Much Do They Really Make? Page 17: $1.1 billion |
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