It is definitely not a secret that I prefer flexible points over airline miles. The name alone gives it away, I like flexibility. There is one thing airlines could do to make their miles more flexibility to their airline miles. This gives the consumers another option and could increase the chances of someone keeping an airline specific credit card.
Adding Flexibility to Airline Miles
Delta’s Unique Perk
Delta currently has a “perk” with their credit card called “pay with miles.” This allows you to redeem your Skymiles at 1 cent per point, but you must have their credit card. You must redeem in 5,000 point increments as well.
This isn’t talked about much, because I think it is viewed as a benefit many won’t use.
If you prefer premium awards, this probably isn’t even an option you would consider. As someone who flies coach, this option adds a level of flexibility to booking travel I otherwise wouldn’t have had.
As we see more devaluations occur across airline, having an option for better redemptions is always a plus. I don’t think anyone can really argue with the fact the more options consumers have, the better it is.
If you hold the United Airlines credit card, you have access to more “standard award” seating than someone who doesn’t. While that is nice, you are still paying double the saver amount, but at least you have access to seats.
American Airline’s doesn’t have better availability or flexible options when it comes to their miles. Some of the best uses for their miles is to be used on partners. Maybe we’ll see a positive change at some point, but I wouldn’t hold my breath.
I feel I spend a decent amount of time looking into award programs and credit card rewards. It is something I really enjoy doing, but I realize not everyone wants to spend hours booking their trips.
I definitely don’t know all the in’s and out’s of all the programs, but I feel I know enough for my own travel needs.
There comes a point when you need to ask yourself, is saving a couple of thousand of miles worth the extra couple of hours jumping through some hoops? I think for most people they would say no.
Just by reading people’s questions in different forums, most want to know the most efficient way to book their “free ticket.”
When I think of most efficient ticket booking, it comes down to a few things:
- Cost of the ticket
- Number of lay overs- including time
- Effort to book
When it comes to the cost, I would like to pay the least amount of points as possible. I have jumped through hoops to save 20,000+ points for tickets because that is a sizable amount. If the savings were just a couple thousand, I am less likely to jump through those hoops.
I have lounge access with my overrated American Express Business Platinum, but that doesn’t mean I want to fly into an airport for the lounge. Don’t get me wrong, if I have a lay over, I will definitely take full advantage of lounge access. But, I want to be at my destination as quickly as possible. This also circles to the cost of a ticket, because if I’ll gladly add in a lay over if it moved my ticket into the saver award section.
The effort is where I think people start to fall off. When booked our tickets to Hawaii a couple of years ago, I used Singapore Airline miles to book the same tickets I would have through United. In order to book those, I had to add people to my family list, call in (couldn’t book online), and spoon feed the customer service representative my flights.
That is a pretty “simple” booking, but still took extra effort (when compared to booking via United) in order to save 20,000 miles for my flights. There are plenty of people who would be just happy booking through United online for the convenience to save time.
Why Pay with Miles is Good
I think there are some who would see this as a big negative change if airline’s started to incorporate this into their programs. I see this as a positive though.
Have you seen ticket prices recently? There have been a lot of great cheap fares all over this world.
Not even to mention you have plenty of bloggers telling you about the American Express Business Platinum 50% (now 35%, unless you were grandfathered in for this year) rebate. Or, the Chase Sapphire Reserve redemption at 1.5 cents per point.
People are starting to use their points as more of a cash currency, than deal with award charts. Saver awards are becoming harder to find and ticket prices are becoming cheaper. I have used both options, but when “paying” with points cost fewer points, plus you earn miles for the flight, why use an award chart?
These cards have some huge sign up bonuses, which can still equal hundreds of dollars in value. The increased Delta credit card offers are still going on, although many bloggers told you there were over a few weeks ago. American Airlines has 2 card issuers which means lot of points.
This is one of the reasons, why I think cash back is becoming a better option than points. Although, I think points still hold the lead (slightly) due to their sign up bonuses being superior.
Anytime you add an option that increases flexibility, I am a fan of it.
Let’s take a look at a few examples. I am comparing the price of coach tickets. If you prefer business, this probably won’t work for you.
American Airlines: New York (JFK) to London
I was able to find saver availability for this flight, which would cost 60,000 American Airline miles, plus $172.56. I avoided British Airways, because those fuel surcharges are just ridiculous.
The same flight itinerary through Google Flights and you’ll see the cost is $587 for a round trip ticket.
If American Airlines had a pay with miles option, like Delta, then you could pay less miles and cash for the same ticket. Even if it followed Delta’s structure of requiring 5,000 increments, you are spending 55,000 miles and $37. Plus you’ll earn miles for your flight.
United Airlines: Newark to Hong Kong
Looking at flights to Hong Kong, there was saver availability for this trip. This prices out for a reasonable 80,000 United miles and $63.76.
For the same ticket, it would cost $770 out of pocket. If United has an option to pay with miles (assuming it followed Delta), it would cost 75,000 miles and $20. This would save you miles and cash.
Those were a couple of examples, and this doesn’t mean this option will always be best. You definitely need to compare these options when looking to book your airfare.
Negativity Surrounding Pay with Points
I mentioned earlier I think people would disagree with me that “pay with points” would be a great addition.
Assigning a floor value where the point has a value below the “experts” theoretical values, could be looked as making the points less valuable. The thought of, “if you aren’t redeeming at top value, you must be doing it wrong” is not something I believe in.
Knowing I won’t receive anything less than a penny per point is quite nice. My value can be higher, but no less than 1 cent per point.
There are many people who want to redeem at the highest value possible, even if that number is just inflated to make it look like an awesome redemption. It’s simply a numbers game to make things look and sound better.
The idea (in my mind) is to see the world for the least amount of points/cash possible. I don’t waste my points, but I also don’t go after the fares that make my redemption artificially inflated.
I think other airlines adding a “pay with miles” feature to their credit cards would be a great addition. As we see lower fares, this could actually give us added flexibility to redeem miles. It could also save us miles and cash too!
The more options we as consumers have the better. As the game changes we need to be able to adapt, this is just another way we can adapt to less friendly award charts.
Do you think this feature would be a positive or negative? Have you every used Delta’s “Pay with Miles?”
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