lindros2

Apologies I don't want to post a paywalled article, but it's probably available via syndication. Again, sorry it's paywalled.

https://www.wsj.com/lifestyle/travel...d=hp_lead_pos8


alternatively: https://apple.news/AB0BwuPYOTJeFpzGqikpbIw

PHXflier

So, what does the article say? Both links are paywalled.

HDQDD

I don’t disagree with either of the anecdotes they put forth. However, neither are really a threat to most of the loyalty chasers here on FT.

Customer A runs a business on his CCs so hits DM on that spend. Customer B buys F tickets and a club membership anyway…I’d say Customer A isn’t a threat as he doesn’t fly much and customer B pays for F and the skyclub, so really isn’t relevant to the loyalty rewards game anyway.

IMO Customer A is a fool. Could be getting far more benes from a CC with that kind of spend. Seriously, leaving like tens of thousands of dollars on the table. But I suppose that’s the folks DL is courting with their changes…people who don’t yet realize that status doesnt mean much and means even less every devaluation.

Adelphos

This is a consistent theme across Flyertalk that I don't really like / agree with. Customer A may be leaving "tens of thousands" on the table - but what is tens of thousands of dollars annually to Customer A, who appears to be a very successful businessman? Maybe he likes his Delta lounges, flights to Hawaii, route network, etc. Maybe that is worth $10,000 a year to him, which may not be that money to him anyway.

It is the same situation with people who call those who put all spend on something like an Amex Platinum "fools" or "clueless." Some of the most intelligent, successful people out there spend zero time and effort maximizing credit cards.

sfozrhfco

This is exactly the crowd that DL is going after. People that are too busy to bother and don't comparison shop. People that want to get some value from Skymiles and notice when devaluations occur are officially tossed to the side.

richarddd

If tens of thousands don't matter to Customer A, he should be flying F or D1 and buying lounge access and wouldn't really need status. $350,000 spend is an easy $7,000 from a 2% cashback card and I wonder if the benefits of status are worth that. It does not take much focus to notice this, especially if you're focused enough to be aware of status and qualification criteria.

What Customer B gets from status is unclear.

Some hoped for more upgrades, but the main thread here on the changes notes that with FCM upgrades are hard to come by for everyone. As someone said, your odds of an upgrade might go from 1/60 to 1/30, but you're still not likely to get the upgrade.

Less crowded lounges would be nice, but DL could have changed lounge access without changing status criteria.

The article's writer said her email is running 10 to 1 against the changes.

steveholt

Those people may be very intelligent and successful in other walks of life, but when it comes to how they use their credit cards or parcel out their spending, they're objectively making foolish or clueless decisions if they're just putting it all on the AMEX Platinum card.

sydneyracquelle

This cardholder Customer A is no fool. He foregoes $7,000 in cashback but he gets 450,000 SM on the DL corporate reserve on $350k spend (corporate card pays 1.5 SM/$ spent after 150,000) with the 15% Amex discount this gives him $5,500+ of DL ticket value. The 4 GUCs plus the $500 choice benefit Amex payment plus the 25k RDM choice benefit plus the FC companion cert plus the unlimited SC plus DM status during IROPS and faster phone service is well worth the other $1,500. After $150k spend on the corporate reserve the 1.5 SM is worth about 2 cents with the 15% Amex discount.

sfozrhfco

This assumes that the person is also diligent about maximizing the most value from the points which is unlikely. That spend could also just yield a one way in business from JFK to LHR which could be purchased directly for $2,000 or less. This is DL's strategy to keep those people that don't pay attention to the value of the points within their ecosystem. Every year they can devalue points and monetize the "elite" benefits giving less and less value to it and a certain percentage of people will either not notice or not care.

A 15% discount off escalating award pricing is still not a great value. Being so attached to a brand that does not care about the majority of its customers is not a healthy relationship.

ty97

Delta PR working overtime to get that story run.

AJNEDC

The article is about those DL customers who do not mind the change. One such was asked for his comment . For the purpose of transparency, the following excerpt is taken from the article."It’s all noise to Mike K. He’s had Delta’s top Medallion status, diamond, for the past few years and has already sewn it up for 2024. He stopped worrying about the outlook for 2025 when Delta released details on Sept. 13.

Mike K, whose company sells hunting cameras and accessories online, runs enough business and personal expenses through his two premium Delta SkyMiles credit cards to earn top-tier status in the current program. He also meets the substantially higher threshold, $350,000 a year, of the new program and will be exempt from lounge-visit limits due to his card spending."
He states the following:

"He hopes the new steps reduce lounge waits, increase flight upgrades and, just maybe, lower mileage-redemption rates: “If the amount of people stick to their word and jump ship—which I doubt they will—then flight prices may go down and I can get more value to my miles.’’

The article also states the following:

"Big spenders

Beginning next year for the 2025 travel year, Delta will have just one metric for earning status: money. Money spent on Delta tickets, vacation packages, hotels and car rentals booked through Delta and spending on Delta’s SkyMiles credit cards.

The spending on Delta’s Amex cards is staggering—nearly 1% of the entire U.S. gross domestic product, Chief Executive Ed Bastian said in June. The airline hopes these changes generate an even larger gusher of cash.

Delta will collect nearly $7 billion in revenue from American Express this year from the sale of miles, ancillary services and brand fees. Its long-term goal is $10 billion. That’s nearly equal to the amount the airline generated from flying passengers in 2022."


https://www.wsj.com/lifestyle/travel...unges-1cbcbb66

BearX220

It is a standard delusion among elite HVFs that a program-wide devaluation will somehow translate into more / better benefits for them. Back during a big United program deval in the early Smisek era I remember a parade of elites crowing about how much better their flying lives would be without all those bourgeois middle-tier types competing for upgrades and award seats. Surprise: nothing much happened for them, a decade later upgrades are scarcer than ever because UA sells more F seats and monetizes everything in sight for anyone willing to pay, and nothing much is going to happen for thie guy in the article either. If he imagines SkyMiles are going to magically acquire more value as a result of all this, I shake my head sadly.

sydneyracquelle

You are assuming someone who can afford to spend $350k per year on a credit card is ignorant. I get at least 1.5-2 cents per mile of value on my RDMs on domestic travel after the 15% discount. Not everyone uses their SM on international business class flights.

sfozrhfco

It is not a question of ignorance, it is a question of not paying attention. Most people redeem miles for very low value. How do you think the programs stay afloat?

Having more competition in ATL would save him far more money than the miles earned on a DL credit card. If the goal is to get a free ticket to Hawaii, walk up fares from the West Coast to Hawaii have been going for $139 each way. Even from ATL they are not that high so charging $100,000s on a card to get a few free tickets to HI is great for DL, not so great a value for the passenger. Using an AMEX card to get hotel points even would gain far more value as the expensive part of a Hawaii trip is the place to stay, not the plane ticket to get there.

sydneyracquelle

Not everyone who lives on the east coast has Hawaii as a top travel destination. I’d prefer to go to the Caribbean in only 2-3 hours. For that 9-11- hour distance I’d much rather go to Europe. For families of 4-5 passengers domestic SM redemption with the 15% discount is great value.