Since the OP is a noob, it stands to reason that he/she is using other sources for research - coming to get an opinion from frequent travelers is probably just one facet of his/her project.

Give the people on this board more credit: we come from all walks of life, most of us here on in business of one form or another, and some people here are actually in the airline industry. I don't really care whether you share your point or not, but the "You people are too biased to think straight" line is crap.

A lot of us here are playing the FF game because we have to. If I want to fly somewhere, I have to buy a plane ticket and I have to buy the frequent flier miles that are bundled with it. On 95% of the routes I fly, there is no viable unbundled product - I am forced to buy miles. So since the airlines have forced me to buy their currency on every transaction I make with them, yeah, I want to maximize my value from the currency. That's where this board comes in...

Maybe we're getting off-topic a bit, but notice that hotels have recently unbundled their product and their points-currencies. I can choose to a room+points, or just a room. There are a variety of non-opaque products to pick from. Airlines have yet to go down that path except in very controlled situations on certain routes, which again leads me to believe that they are very, very happy forcing us to buy their currency on the vast majority of our travels - because it is quite profitable to them.

I do hope so ...

Another thing worth noting is that there are two main types of threads on the forums; one is about how to earn and spend miles, and the other is about how to get premium treatment from an airline. In the old world business travellers flew business class and they got business class service -- which was significantly above the service level for tourists in tourist class. After the arrival of low cost carriers the airlines were forced to sell decently priced economy ticket to business travellers. In a sudden a significant part of the most frequent travellers were no longer found in the front cabin(s).

Now, if you are a traveller that is stuck in economy class due to corporate policy then the airline has lost you as a business/first class passenger, not because of your dislike of proper service but because of regulation. In any other business good customers are treated better than less good customers. The frequent flyer programmes doubles as a neat way to rank economy class passengers, and to give back some of the business/first class privileges to those who are good enough customers.

And then the win/win situation is obvious. I choose to fly with one airline (or one alliance) instead of five different ones simply because I seach recognition as a good customer of an airline, which in return will spare me the long queues on check-in and give me a nice chair and a drink while waiting for their delayed flight.

My best guess is that the most important reason to keep the frequent flyer programmes is centered around customer-relations management, and not around having a profit center around a fake currency.

I agree with you and I think it SHOULD be because of customer service management, BUT I believe the reality is that it is just NOT about that whatsoever. Sure there's some degree of it--they (any given airline) want to keep people on for some CS reasons. BUT the real reason is because numbers = money and money right now is what keeps them alive. We are numbers to them so their marketing strives to basically spam the world and spam us to keep us interested more and more so we fly more with them than another airline.

There's no loyalty anymore... it's just my airline trying to keep you on a string more than the other guy.
I get more money if I am successful--constantly.
AND, this sorce of partnership revenue keeps us afloat so the bankruptcy courts are happy. Besides, if things done in promos we put forth take 6-8 weeks to post to customers, then similarly, those who wanna see result sof our agressive marketing have go to wait for our monetary reports as well! That gives us more time to get new marketing going and thus make them wait longer.

Ok, here is a post that adresses the issue of the effect which FF schemes and benefits have on purchasing decisions and behavior.

I am an elite flyer for UA. I always book UA because of 2 primary reasons. 1) UA is the major carrier in Denver and 2) I am a 1K/MM/UGS flyer with them. To continue discussion on item 2, because of my travel pattern (a lot of last minute changes of return time/dates) my status literally guarantees me a seat on a flight to either a new destination or home. The benefits of the frequent flyer program keeps me loyal to UA. If there were no FF programs, I would fly anyone and everyone that benefits my travel. I would not be loyal.

ahh, but item 1 is llisted first which some may think means you value it more without even realizing it. What if there still ARE FF programs but UA decides to leave Denver, and then AA comes in for example?...

Would you be "loyal" to UA?

Is it because of your item #2 or #1?

Couldnt American Airlines eventually enable you to be in the same situation you are now with UA? And what, with the ability to get status matching, it should be relatively easy to convert one's loyalty almost over night should UA ever leave that airport on you.

Are we loyal because of what we have earned, who we got to know on the plane, the routes and conveniences and things we are used to, and how they treat us every time we fly, or are we loyal because another business was successful in both marketing to and proving to us that they can do all of that even better for our needs? If AA came along with the same thing or even better, ou may jump over! What is loyalty anyway? I work in recruiting. In the work force, there often is none! Sure, a candidate is expected to illustrate some of it in order to show that they are serious about their carrer, but companies will often hire from anywhere. Similarly, airlines do not care so much WHO you are, but if you show up and give them what they need to succeed. That is money. If their aggressive marketing gets you to jump over to them, they win. If the other airline happens to leave, you have to chose the new one anyway. What if AA is able to somehow get UA to fail and thus, have to leave Denver anyway. Then AA won.

I use AA as an example here only.

I hear ya...but....to play devil's advocate a little, even without the 1K perks, wouldn't you still be pretty much locked in to United? Assuming you fly to a reasonably diverse set of destinations out of Denver, Frontier probably can't support you...or could they?

There are some big cities where airlines have to compete intensely for O&D business - Chicago, LA area, etc. But there are other cities - like DEN, PIT, CLT, DFW, etc. - where one carrier has the city locked down. If you're a frequent traveler, they've gotcha with or without the FF programs.

Maybe I'm getting off-track a bit, but I've noticed recently that airlines have stopped competing really hard for MCI business. It's been gradual over the past year or so...perhaps because WN has been so successful here, they aren't doing as many battles over O&D customers as they used to. And if WN develops such a stronghold that others don't compete, that isn't much better than being in a place where 1 legacy carrier runs the show.

Then with all due respect, stop posting in this thread. Either state your position or stop wasting our time. I, for one, would love to hear your opinion because I may learn something I do not know. However, this "beating around the bush" discussion is not providing any answers, especially for the OP.

Thanks.

IMHO the FFP are going to change dramatically over the next few years.

The way FFP are designed is in my opinion a big error, as these programs were rewarding frequent flights instead of rewarding high spending. This was not that big a problem when they were introduced in the early 80s, as fares were substantially higher and less diverse than they are today. For example there were no 199$ transcons during that time.

The problem is that many FFPs, specially in the US, reward people the same, whether they have spend $2000 for 6 el-cheapo tickets to Europe or two walk-up fares for $2000. Most likely the guy buying the 6 el-cheapo tickets is even rewarded more in respect of miles and status. As an reward he most likely earns top-tier and can probably get a Award ticket in Business Class for his miles, which sells for at least $3000. The business guy buying the two expensive tickets hardly gets anything. This is in my opinion not smart business.

Although DL stepped back from their Skymiles "enhancement" with lower miles for lower fares, I think this is a general, worldwide trend. Many airlines all over the world, as LH, BA, SQ, TG and others either allow only limited mileage earning on lower fares or are currently in the process of implementing this.

An interesting scheme is Air New Zealands new Mileage program, in which you earn Airdollars. These Airdollars are awarded to you according to the fare you bought. You spend them on regular flights on regular fares, no more mileage redemption chart necessary. The airline even has the benefit of charging Airdollars according to the demand of the flight.

Take this one step further and award the miles according to the amount spend, you are at the scheme I am expecting over the next few years.

"Because I said that I don't want to debate the substantive issues here."

I second that...

You bring up an interesting point. I have not been a FF member in the early days of FF programs (AA in early 80s) nor did I fly before deregulation in the 70s, but I would imagine that at one time, airlines charged fares based on something more seemingly logical - how far you are actually flying. Many carriers in other countries do this - shorter flights cost less than longer ones because the internal costs are higher for longer journeys. If that was the case when FF programs started, then the miles being based on travel distance made sense, because it DID correspond to fares. Once deregulation set in and airlines started charging fares that have absolutely nothing to do with distance flown (and hence their costs of flying you there), the disjoint between spending and awarded miles started. The hotel programs, on the other hand, do it all based on revenue.

Thanks to these many replies on my post. It has been a great help to me so far. I would like to ask you guys a question (cause i'm not a FF):

Are you loyale to an airline/alliance because of the miles you get or because you really think that your prefered airline is superior (thus, the rewards are just a additional benefit). Or in a other way: Do FFP really create loyality or do they just create customer retention.

Cheers,
Flavio

where I live and where I fly helps determine and maintain my use of airlines I need to get those things done with more ease than some other carrier. If I build status in an airline, I would wish to continue to stay with it, but mostly, for me, if their rules and service are more to my liking, I stick around. But if they stop being nice and put too many restrictions on me or I get hung up too many times because of too many problems, I would drop em like a wet towel. If I have miles on them by that time, I unload them by taking some trips or something, and then zero the account not to use them again --til such time that they may come around and be better than say, the one I am using in place of them. Because the one I am using in place of them could also now become the bad guy. All the airlines have problems, and things seem to be only getting more tight and restrictive with this and that new rule and hurdle in using awards and upgrades. But you go with the one that best suits your current needs. I would like it to be about loyalty instead of hijacked loyalty, and I would like it to be about service instead of luck, but sometimes it just aint.

Like sands in the hour glass, so are the days of our lives!

-(who said that?)

MM