how does selling products get you miles?
 

I have a product I wish to promote online and was wondering about trying to market it to people like me who really love getting miles.

The example would be that I sell you the item and when you buy it I offer say, 500 or 1000 frequent flier miles.

Maybe I talk to the airlines and find out more about how small businesses GET these certs or other paperwork that they are able to offer to their employees or best customers or new customers in the form of mile-incentives.

Example:

By my product X and you get 1000 AA miles or DL miles, etc.

price: $12 or $15.95...
...or something like that.

Something that we mile people know is worth the cost (because it costs more to buy miles on the airline but you dont even get anything extra for it) but also something that still makes me more easily sell my product.

I would thus be targeting people like FT users who want to get miles.

Does anyone know the feasibility of this type of thing, who to contact about getting these mile certs that I would basically be giving with my product to my potential buyers, or any costs associated with this sort of thing?

Thanks!
:)MM

I hope this is the right place to ask this question--if not kindly direct me. If it works, I would be thinking of FT users first!

Airlines like to do this. They sell their miles for more than the statistically expected cost of redeeming them for awards. For some, selling miles to partners is a major profit center.

Each airline has its own program. There's no central "get any airline's miles here" office. That's why only the largest affiliates, such as major hotel chains or car rental companies, offer customers a choice of airlines on which to get miles.

Contact the individual airline. If you don't have a name or a title within their frequent flyer program, any customer service agent should be able to aim you in the right general direction. It may take you two or three pass-alongs to get to the right individual.

Expect to pay in the general vicinity of 2¢ per mile. The cost goes down as the number of miles you want goes up. Figures as low as 1.6¢ have been mentioned for Hertz. At the level you're probably talking about, your cost per mile will be at the high end of the range, not much less than a member would pay to buy the same miles from the airline (if it's one of the airlines that allows individuals to buy miles).

You would buy the miles from the airline just like anything else you buy. There have been threads here in the past with the cost, I don't remember it off the top of my head. We use miles as an incentive here, and I believe we are in the two point two cents per mile range.

We upload a spreadsheet with the person's name, AAdvantage account number, and number of miles, and American transfers them into their account. I believe you can also purchase certificates for say 500 or 1000 miles the prople can fill out and mail into the airline.

For more details on the American program (it's what we use, I assume others are probably similar) visit

https://www.orderaamiles.com/orderAA...derAAmiles.htm

Full pricing and all the options are there.

thank you!
the information helps me and though there is an initial investment, my theory is that maybe the ability to market products to people like myself who are in here looking for ways to get miles AND something along with it, could be profitable in the end.

i will do my research!

:)MM

You've got competition...
 

Doing a quick analysis...

Using the AA link Mike provided, each mile costs 2.465 cents. $15.95 gets you 603 miles give or take a few feet. From a marketing perspective, I guarantee that you will sell a lot of whatever it is if you are giving away 1000 miles for $12 - $15.95.

That being said, people are selling "white envelopes" on ebay and giving away miles. If your propoduct is any better than a "white envelope" you'll sell millions.

never fully understood that ebay thing
 

do you suppose these ebay people had been persons or companies who had once bought the miles like you can in Mike's provided chart? And then they decided to unload them and do it this way? I have never looked at the ebay things because I have not yet had a need, but since you can only really assign awards to people and not individual miles in lots of say 1000 each, I started to figure that was what they were doing.

IS that so? If so, then yeah, I suppose that my product MAY be ok and could sell nicely... I still have to see if it is worth the initial upfront investment and do some sort of cost analysis based on time, etc.

thanks.
:)MM
the only ebay thing I understand well involving miles is that current thread in the AA forum about ebay anything points. totally different deal though.

Right. The general model is that the buyer buys an award that requires, say, 25,000 miles. The FF program member gets the award in the buyer's name and sends it to the buyer, who travels on the award ticket.

This is against the terms and conditions of most FF programs. Some sellers pretend they're selling a plain envelope that happens to contain an airline award as a free gift to the buyer, but this is a legally worthless sham.

Airlines vary in how diligently they go after people who sell awards. The risk to the seller is cancellation of his/her FF account, including forfeiture of all points/miles. The risk to the buyer is having the ticket invalidated at the airport and having to buy a new one at the last-minute walk-up price or not going on the trip. Many people are either not aware of these risks - despite airlines' efforts to publicize the cases in which they catch someone - or think they're small enough to be worth taking the chance.

___________________________
Most complexity results from not thinking a problem through carefully enough to realize how simple and elegant its solution can be.

At least some of the people selling on e-bay are doing just what yo say, buying a set of say 250 of the 1,000 mile certificates and then turning them around for what they hope is a profit online.

A few comments
 

If you were to offer 1000 miles for a $15 item, I would be your best customer! First order, $XXXXX, second order $XXXXXX, etc :D


You would be loosing money!

I can confirm that you would be paying around 2 cents per mile as a small business. You can find the info for AS on their website and other airlines by contacting the appropriate department.

(On the other hand, my guess is large customers like Citibank are only paying about 1 cent a mile)

So simple math shows that you would be paying the airline $20 for the 1000 miles you are offering me, the customer.

Essentially, you could only offer 1000 miles for a $15 item as a first time customer bonus - where you count the $ you loose as a marketing expense to gain a new long term customer.

Well, how about offering 500 miles instead for a $15 item? 500 miles = $10 cost to you, so you are now making a $5 profit. But, now the customer is paying $15 for 500 miles, so 3 cents/mile. This could work for you provided your customers really want your item (aren't just buying for the miles), and you can afford to only make $5 on per order (after $10 expense for the miles).

If I read your original post correctly, you were asking if you could make money giving FTers the type of oppurtunity Randy did with the famous Inside Flyer promotion - where FTers were buying the mag for the miles, not the mag. The answer is no - this cannot be done economically by a small business - not unless you have a way of getting buying the miles from the airline at a significantly lower cost than your customers are willing to pay.

Gee, I like this part:

"Most complexity results from not thinking a problem through carefully enough to realize how simple and elegant its solution can be."

funny but not original. Got your own?

Could also be that there are so many things to figure out in miles land that it needs collective assistence, which is what see this entire forum as in general.

I mean, take the gift card scheme. Have a simple way to explain THAT ONE to a person entirely new to it?

Didnt think so.
Ok so complexity does have its place...


ANYWAY, though selling of say, 25k awards is technically illegal and ebay is where airlines look for and catch people, I have raised questions on this one in the past. I have often been at odds with this one because everyone knows that if I were to give my award to say, my best friend or my brother, that person would PROBABLY give me something in return for it! Thus, something did in fact change hands and it could have been money or expensive wine, or even another award of some kind that I needed later on.

So who can really judge? Why is that more OK than me selling that same award online to someone I dont know? And how can an airline say that it is wrong when it is actually so blatantly set up to easily do it, that the flaw lies in their system rather than in the way people would naturally chose to handle it? I mean, sure, the rule is on there but what a dumb rule.

If I called and TOLD them "HEY, I AM SELLING THIS AWARD TO MY BROTHER" they could technically bust me for it if they wanted to. They probably woudnt though, because they can see his name, they realize it is a relative and they think that's more ok. But if I were to just try to get rid of it because I maybe had no living relatives or something--even at some low cost where I used ebay to advertise this fact--then they would bust me hands down even if the transaction resulted in a mere $1 gain. They would bust me if only for the princile ofthe thing... because that's the rules, sir! Sorry!

Seems they just dont like competition even if it'snot the intent, that's all. And ebay has put us on their sales level so they hate it. So that is what I never understood. I think instead they SHOULD allow the sale of awards but somehow find some way to put a fee on this which we are wiling to pay. Then they make money no matter what we do and we still win.

But as for the selling of the miles that one can buy in bulk as some sort of promotional tool or way to help sell a product as a reward bonus, it seems as though the people who do that would be less illegal. Think about it: who's to say that EBAY buyers are not their best client or new customers? After all, it seems to me that these 250,000 programs where you spend $6000+ on batches of miles 9as shown in chart from the link in previous post) are geared toward that kind of business model more than anything. What limits the product type being offered?

This went off base though--back to a simpler earth:

I am still trying to see if my product idea--which had nothing to do with selling miles or awards on ebay--will even fly... to make a pun.

cheers!

;)MM

this hits it on th ehead. I am thinking it is a no but am still weighing the ideas. thanks for these tips as well!

:)MM

It depends on your definition of the nail. ING bank, for example, has said over and over again it costs the average bank $63 in advertising and the rest to get a new customer. They pay $35, giving new customer $25 and the person who referred them $10. As you can open the account for a dollar, they lose $34 with every transaction.

But, wait, some people, like me, stay with them for many years. And we keep referring people, and we put money in there.

It's not just the cost of the product you have to figure in, it's what it would have cost you to get that person to purchase the product. If it's more then the $20 the miles cost, then it's worth it.

I work at a non profit, and the miles are used as gifts, prizes, awards, whatever you want to call them for our major events. Raise $1,500 get a golf shirt or 1,500 miles. Raise $7,000 get a $700 certificate for a day spa, or 12,500 miles.

The miles are an incentive for some people (me I would rather just get on a plane and go someplace for the weekend). You can't always look at what it cost to get them and how much you are getting in, in our case many of the people who qualify for the prizes say keep them, it's not important for me. Others watch their numbers daily to get to the next level.

If the miles get people in the door, then it may be worth it even if you lose money on the deal at first.

Exactly. But MM was thinking of miles being the primary purpose of the purchaser every time. That's why I said:

you are both right and that's why I have to decide!
 

Quote:
Originally Posted by cordelli

If the miles get people in the door, then it may be worth it even if you lose money on the deal at first.


Exactly. But MM was thinking of miles being the primary purpose of the purchaser every time. That's why I said:

Quote:
Originally Posted by wanaflyforless

Essentially, you could only offer 1000 miles for a $15 item as a first time customer bonus - where you count the $ you lose as a marketing expense to gain a new long term customer.


both of you have posted excellent and greatly appreciated thoughts on this one!

The reason why I started even thinking about it was because my friends and I started a small events and promotions biz a while back but were thinking of taking things to the next level. We have other activities and this sort of fell a bit short of where we wanted to go at first, but we do have ideas, have some product, and have some desires...

Check out my site--an entirely unrelated hobby, which I started to think COULD involve miles or some sort of bonus for purchase if done correctly:

http://www.LarryTheLizard.com

What if Larry was purchased--or shirts or other products that involve Larry-- and people who get one receive miles? Then maybe, just maybe, I would have a whole bunch of potential new customers by simply marketing it better to THIS forum!

However, it would have to be something people want too. AND, if I lose money at first, then I'd better have a secondary thing already in the works. Mabe some event where we set it up so that anyone who got a larry gets miles, but also, they now can come to the event and get more or something like that. It could even be an E-event or something. I dunno yet.

Not everything is on the site right now but one example of the events has been some Jimmy Buffett tailgate parties and things like that. Larry has done booze cruises and has been involved with travel too.

My question is this: do FT people like us point mongers primarily get products because they know they can get miles, or do they actually want the product and the mile offer ontop of it is the thing that pushes them over the edge. think the second one is more likely but if the product itself is something good, then maybe miles is a way of just getting it more widely known by a large audience, who by default, spreads the word to others.

Again, I do not yet know exactly how to do it all or where exactly to focus my efforts but the idea of giving miles or points out to people like FT users would be good because it does target a certain market of people who might also now know Larry. If that happens, I suddenly gain new loyalty in areas where it can later pay off and make back some of the losses from the miles gig, and then some.

Business expands from initial costs and that alone generates more money in the end.

I guess...

;)MM

share AA miles - they let you GIVE miles but TAX the gift $175/15k. other programs have same deal.