When it comes to airline credit cards, there is normally not a bunch of great reasons to hold most airline credit cards after the first year. Other credit cards typically offer more points for airfare booked (and in transferrable programs) than airline cards and lounges are not quite the great offering that they were pre-covid to justify free passes each year. But, if US airline cards picked up this perk from Korean Air, it could make it interesting!
US Airline Credit Cards Should Offer a Discount on Flights Booked
Here is the new perk on the Korean Air Skypass credit card: “Apply for a SKYPASS Visa® card today and you’ll receive a special one-time 3% discount coupon for a Korean Air ticket(s) purchase made within the first six months of account opening.”
I find this to be an interesting credit card bonus perk but I think US airline credit cards could take this a step further to make it a lasting benefit on their personal credit cards. I think it would help with card retention and give people an actual reason to book travel with that airline and to use the airline credit card when doing so.
A Win-Win for Airline and Customer
This is the balance that credit card companies/airlines want to find – something that moves the needle to attract customers and make the card have a superior place in the customer’s wallet and also brings in money for the company.
Let’s look at United Airlines. The terms on their United Explorer card (this is their mainstream card with the $95 annual fee) has, among other benefits, the free checked bag for the cardholder and one companion. However, according to the card’s details, you must purchase the ticket on United with that United card to earn that free checked bag.
Well, that means you miss out on the 5X points you could get from bookings with a different credit card. If you have elite status with the alliance the airline is in, you would get free checked bags anyway so that eliminates the need for that.
United is likely only getting people to use their card on flights that do not have other credit cards. But, if they want the more savvy credit card users to get, keep, and use their credit cards, they should consider something like this Korean Air perk.
Imagine if you could get a 3% discount on an airline credit card when booking with that airline! That would likely spur some more use on that card and it is easy enough for the airline since this is a product they set the price on and sell themselves. If they encourage card customers to use their own airline card directly with the airline, this means that the airline does not have to take a hit selling through a third party so they could afford to offer that discount directly to the customer.
Edit: to be more clear (as I said in response to a poster below) I don’t want to see such a benefit lasting only one-time or for just six months – that is Korean Air’s approach. I’m saying it is an interesting perk that US airline cards could adopt – NOT THE SAME EXACT WAY.
If there was 3-5% discount plus you get the 2X miles on the purchase of the ticket, that could definitely move the needle for many to use a card that may otherwise just sit in a drawer. That is my point and sorry for not making that more clear.
I am all for encouraging card issuers to get a little creativity. This is especially true when there are new credit card products coming out that are challenging the way things have been in this space for a long time. If something like this is of interest to you, mention it to your card issuer. I know for a fact that when things make enough noise, we do see changes that would answer the requests that come in.