Mileage Math: How To Beat Frequent Flyer Inflation

Mileage Math: How To Beat Frequent Flyer Inflation

MileageplusBack in college, I worked a United promotion to earn a free first class ticket to Hawaii by booking a transcon trip in six segments and 8,000 flown miles. The paid ticket cost me $306, a fraction of the value I earned from the trip, and it launched a lifetime addiction to the opium of free first class tickets and upgrades.  Today, frequent traveler points are a currency, and they’ve been devalued quickly, as cash-strapped travel companies try to reduce the cost of the loyalty those points were intended to create.

Devaluation takes place three ways:

1. Fewer “Saver” Seats Available
For years, frequent flyer programs promised “free ticket anywhere in the US for 25,000 miles.” But that redemption level quickly became a “saver” reward, with “standard” rewards pegged at 50,000 miles.  Of course, “saver” awards have become harder and harder to find. That’s a 50% devaluation right there.

2. Higher Redemption Levels
Airlines have kept that base 25,000 level constant, while business, first and international rewards have crept up.  International First class saver awards that might have been 120,000 miles five years ago, are more like 160,000 miles today. Standard awards – now 320,000.  That’s a 62.5% devaluation.

3. Lower Earning Levels
Double and triple miles, once ubiquitous, are rarely awarded on discounted coach tickets. When United and Continental merged this year, they cut the bonus level for their Premier Gold members from 100% to 50%. Another 25% devaluation.

For many years, it was easy to get 4-8¢ value per point on carefully redeemed points, and theoretically, it’s still possible in some instances.  Use 160,000 miles for a free first class ticket from New York To Sydney that would cost $22,000 and you’re getting more than 13¢/mile in value.  But use 50,000 miles for a domestic ticket you could buy for $400, and you’re getting 0.8¢/mile.

All frequent traveler programs, and the increasingly profitable credit cards attached to them, are inching their way towards a 1% valuation.  It’s already the  de facto valuation for the “no hassle” rewards programs, whose “any airline, any time” promise for a 25,000 free ticket is limited to tickets that cost up to $250. Most airlines are increasingly finding ways to tie the earnings level to the dollars paid, and not the miles flown.  It is a fairer way to measure our value to the airline, and though we’ve gotten accustomed to much more than a 1% “loyalty rebate” on our travel, it’s hard to argue that we deserved more, and there’s little indication that any airline is going to move in the opposite direction.  That leaves those of us addicted to frequent flyer rewards only two options: get used to it, and get smarter.

Maximizing Your Returns
Doing the mileage math is easy.  Divide what it would cost to buy a ticket by the number of miles it takes to redeem for it, and you have the value.  If you can get 2-3¢/mile these days, you’re doing well.  Never redeem for less than 1¢/mile. Find an international saver award in first or business class, and you’ll be looking at 6-8¢/mile.  It’s what I try to do, and I have a few tips to help you do the same:

1. Use A Service like ExpertFlyer
Airlines constantly fiddle with their inventory, releasing seats strategically to maximize their revenue.  Obsessed flyers like myself used to call daily to check availability, but now there’s a service that will do it for you.  ExpertFlyer checks constantly, and sends you an email or txt message when the seat you’re looking for comes available.

2. Check Alliance Carriers
Oneworld, Skyteam and StarAlliance all allow you to use your miles across all of the alliance partners.  Make sure to ask a reservations agent to check all possible alliance routings.

3. Be Flexible
The more flexibility you have, the more chances you’ll have at finding saver seats.  Not just dates and times, think alternate airports as well. Most awards allow you to fly into one city and out of another.

4. Fly Last Minute
Nothing’s worth less than an unsold airline seat at the time of departure.  Sometimes award seats are dropped in the last days or even hours before departure.

5. Check Right After Midnight
Or whenever the airline’s courtesy reservation holds expire.  Someone else’s loss can become your gain.

6. Book What You Can, Change it Later
If you can get the outbound flight but not the return, book any return you can find, and then try to change it.  A riskier strategy, and one you shouldn’t try without a backup plan, but I’ve found it usually works out.  Again, ExpertFlyer is a key tool for success here.

Other tips to share? I’d love to hear them!  Enter your comments here, or tweet them @billykolber.



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