Hi all,
I have posted this in the Aegean thread, not because it belongs here, but because I found no better place, and in alphabetical order this is the first in airlines.... Maybe the mods can rectify this? Will flag my own post to get this done.
In another thread I just read a post by Dave Noble where the concept of airline "loyalty" programs was challenged. This was in response to yet another post by another member saying that Qantas needs to start valuing "loyalty" from the other side - ie airlines valuing their customers. What struck me as so correct was the simple message Dave Noble had - that these programs simply entice their members to make irrational choices. This is the concept I would enjoy to foster debate about. Because I completely agree with Dave's angle.

It is in my belief that loyalty programs are always designed for one simple outcome - to entice the consumer to stick to the product of said "loyalty" program. This concept is marketed very skillfully. Of course it is - companies research this and hone their offered loyalty product to make consumers choose in their favour. The base thing offered is the accumulation of "points" in whatever fashion these are marketed as. Thus enticing consumers to favour their own product in the gaining of said points. And in the specific case of airlines, there is also the carrot of status - lounges, etc. I have fallen to this trap for endless years - making flight purchases that helped me gain/retain these privileges.

But is it worth it? I feel the clear defining way to evaluate this is simply if the airline grants you this. They are a business. They do noone any favours. So if you get something out of their loyalty program, you are getting less than what they gained from you. This is correct business. They may have crap booking systems, "ridiculous" rules and fares etc, but are they incompetent? If you feel, as many flyers do, that you have a better way of doing things, then you are disregarding the supreme fight they have every year just to stay afloat. And you are pitting their reality versus your own. If they could become better airlines, more profitable, etc, they would. That is their eternal fight.

They just use the modern version of marketing, as proven worthwhile, to gather people to choose them. Using every tool they have. And they all do it. You can march with your feet and choose another airline. The choice is yours. But your individual loss is not a big thing for them. Hence the perception that "loyalty" is one way. The next airline will simply entice you on the same path...

At the end of the day, travellers should, IMHO, recognize they are simple participants in a world that is governed by extremely savvy professionals. If you can find a chink, and extract value, great.

But anyone in this forum that feels they know more than the airlines themselves, you are deluding yourself. They ponder and work this everyday.....

Of course airlines are running a business with the aim of making money. Frequent flyer programmes are, for some airlines, a bigger money machine than the actual business of flying nowadays. This goes far beyond enticing customers to purchase tickets on their airline - this is about the business of buying and selling miles/points as currency. And in that game the FFP is the bank - and the one who decides the value of the currency. They sell their points to partner airlines, as well as Visa/MC/Amex for real cash. And only have you spend those points on a service that hardly costs them anything (i.e. seats that would otherwise go unsold). And of course depreciate the value of points when it suits them. Its a game that they know to play very well.

Having said that I do not believe that, as an individual, taking part in that game is a bad thing. When played correctly there is still value to be gained. It's important to not let yourself be blindly guided by what the airline or FFP tries to have you do. But when you understand the game there is nothing wrong with taking part. Just be aware of the decisions you are making.

So practically that, typically, results in a few general guidelines: Book the cheapest flight that suits you, in the lowest class that suits you, on any airline. Don't value earning miles and points at something higher what you can actually spend them for. And...spend your points. Devaluation is an ongoing thing, so don't keep them sitting in your account. Spend them because their value will only go down.

Xandrios, I agree and I agree.

Loyalty programs are marketing plans. Plain and simple. Not entitlements because you are gods gift to business. People are absolutely obsessed with feeling like they got a deal, something for free, "unlimited" access, etc. In general, companies that offer a more "premium" product and/or higher markup, tend to offer some better perks. If I had a dollar for every time I saw someone grossly overpay for something because it "came with something," I'd be quite well off. People will vehemently defend these choices to the death. Conveniences can be nice to have. We all have ones that are more important to us than others. Some take it a little too far.

I believe its best utility is for some frequent business/international travelers. Maybe your company has lax travel restrictions or a partnership with a specific brand. Perhaps you fly so much on the company dime that you have tons of points for leisure, or truly invaluable perks. Where all that money spent has no concern to you. It makes sense that these customers are marketed toward. That business is big big money for the airlines.

For me, no matter how many times I have tried to stay loyal or even avoid certain airlines, it rarely works out. For 90% of my travel, I'm going to be picking that 3 hour direct flight for $200 vs the 5 hour, with layover, for $450 to get on the plane first to "avoid the stress of stowing my included carry-on".

Loyalty programs are sort of a rebate program for those who jump on a hamster wheel that is supposedly a deal where "I scratch your back now, you scratch my back later"; but these programs have businesses hoping to prey on customer sentimentality to goose the revenue numbers and margins at the expense of customers.

I thought that most of us here on flyertalk realised that loyalty is a long gone concept and we're out to get the best deal (time, frequency, cost, comfort etc depending on the individual) instead. FF perks are an add-on that may be nice to have but not a main driver.

If this were true, I doubt FTers would be proudly declaring 1k/Medallion/whatever status if it's just about the best deal, or talking about mileage/mattress runs just to maintain status.
The way some grouse over the FF perks... I'd be hard pressed to say they aren't the main driver.

We must frequent different parts of flyertalk. Some do indeed behave as you say but from what I read, most have outgrown that stage.

I wouldn't say that I've outgrown loyalty, but loyalty hasn't been a deciding factor since Covid rode into town. I now have low tier status on a handful of airlines (as opposed to top tier on one), so I'm able to select flights based on convenience and price. Of course I continue to collect points. On occasion I use them. That having been said, I don't see any substantial difference between AA, DL, and UA. All three are okay enough.

The profit model for at least US airlines is selling miles to partners, not flying people from Point A to Point B. The new loyalty plans are moving that way. This is even more acute with business travel likely altered forever. To that end, the priority of the airlines (at least the legacies) seems to be moving away from the weekly road warrior and to the person that will sign up for their co-branded credit card. I was in a recent focus group for a major airline and that was definitely the direction I saw.

With airlines monetizing the premium cabins with more aggressive pricing chasing status is losing it's luster. At least in the US.

And then there are those of us who fly a lot, and our travel patterns and location just result in more flying concentrated on one airline or alliance (in my case, UA), and earning higher status on that airline because of it. That I buy a lot of paid F also helps. I'll take the perks if they give them to me, but no loyalty whatsoever. If AA, Alaska, AF or KLM has the best route or a cheap business or domestic first ticket, I will fly them, and I do have flights planned on them for this summer. If you are in the front cabin, you are treated about the same as someone with status anyway. (But I generally will not fly Southwest, Spirit or Frontier - no protection against IRROPs, poor service except Southwest.) I cannot even imagine doing a mileage run.