Which Airline Frequent Flyer Program Is The Best?

by on May 19, 2012 · 29 comments

in Travel Industry

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I get asked the question, “Which frequent flyer program is the best?” all the time. My response is always: “the one that works the best for you.” However, consulting groups always try to create surveys that definitively figure out which frequent flyer truly are the best. The only thing is, since frequent flyer programs confuse much of the general public, these results of these surveys just tend to confuse everyone even more.

The Wall Street Journal published an article the other day about the best airlines for redeeming frequent flyer miles based on research from a consultancy called Ideaworks. The key theme is that: “The survey also signals an emerging industry trend: Airline points are more rewarding than airline miles,” and I couldn’t disagree more. Fixed-value points programs do not offer the type of aspirational awards that traditional frequent flyer programs offer, however they do offer reliability, which apparently IdeaWorks values the most.

The Study
Here’s how it went down. IdeaWorks conducted a survey of award seat availability between April and October 2011. IdeaWorks made nearly 7,000 queries on 23 airline websites to test availability. It looked at each airline’s 10 busiest long routes and 10 busiest short routes on 14 different roundrip dates between June and October, making 280 queries on each airline, so that seems like a pretty broad swath, though I’m not sure exactly what routes they were looking at.

They found that Southwest has the best award seat availability among US airlines. The worst? A tie between Delta and US Airways. The survey found that those two had no award seats available at the lowest mileage level on over two thirds of the queries submitted.

The study found that award availability increased on British Airways and United, along with JetBlue, Southwest and AirTran, though it is harder to find even standard level award tickets on American these days, probably because of the bankruptcy.

IdeaWorks carried out (and the WSJ reported on) a similar study of award seat availability on 24 airlines last year, and Delta and US Airways were at the bottom of that list as well while Southwest and JetBlue were among the top airlines for availability. In fact, the two studies came to strikingly similar conclusions, which makes me wonder why they even bothered doing another one.

Points Versus Miles
As I mentioned, the main conclusion of the study was: “An emerging industry trend: Airline points are more rewarding than airline miles.”

The study found that airlines whose loyalty programs where points are earned based on how much a passenger spends (like Southwest or JetBlue) were better than traditional loyalty programs based on miles flown (like the legacy carriers). That’s because travelers can still use these fixed-value points to find seats when fares go higher and there aren’t the same blackout dates or capacity controls. They just have to spend more points to get that award seat. It’s just like buying a ticket for any available seat, only you’re using points to do so, rather than having to find scarce award seats available at low-mileage levels with traditional airline programs.

The article also predicts that more and more carriers will be converting their program to spend-based points systems in the next few years. The president of IdeaWorks says, “points-based systems provide better flexibility to the consumer, and they are going to become more prevalent. It’s just infinitely more efficient for everyone.” More efficient maybe…but more valuable? I’d argue not.

Here’s where I really take issue, though. The article implies that the single most important factor is award seat availability. For sure, that is a huge factor, but is it the only one? For travelers looking for the seat they want when they want it and are willing to pay the points necessary, it’s probably true.

However, for flyers who have some flexibility and want premium awards, I’d argue that, despite the lack of low-level award seats on short haul routes, there is still more value to be had from mileage-based systems. After all, a $3,000 business class ticket from the US to Europe would could cost you around 300,000 points if your points are worth a fixed value of 1 cent each, whereas you could find that same ticket for as low as 60,000 miles for an offpeak award using US Airways Dividend miles, for example.

Ups and Downs
Still, at least with the passengers flying those fixed-value airlines, these points systems seem to be quite popular. Southwest had 16% more award seat availability in 2011 compared to 2010, and the percentage of travelers redeeming points for them also increased, according to the article. Then again, United’s availability jumped nearly 16% as well—probably due to the increased capacity from the merger, despite what naysayers had predicted (and despite complaints from United and Continental elites!).

American’s low-level award seat availability dropped from almost 63% in 2010 to just 45.7% in 2011, while Delta was at a shameful 27.1%. No wonder I’m always having to defend the airline!

Another interesting fact to note from the article: in general, discount carriers had more availability than larger global carriers (93.5% compared to 62.9%, to be exact). Does anyone else find a figure in the 90% range suspicious? Are you really telling me that 93.5% of the time, you can find the award seat you want on a discount carrier?

IdeaWorks posits that this is the case because discount airlines have fewer other perks to hand out to loyal customers like upgrades and premium airport facilities. I’d also suggest that perhaps it is because fares on these airlines tend to be lower and thus require fewer fixed-value points for redemptions that they might be more popular options for redeeming points. Still, that figure seems high.

What This Study Ignores
In my opinion, the survey is bogus because it is about one single factor: award seat availability. While that is certainly a significant feature of mileage programs, to extrapolate an entire overview of the frequent flyer world and the relative value of miles from various programs based on this criterion alone while ignoring several other key facets of any mileage program seems irresponsible to me.

Partner awards: First, they did not factor in partner award availability, which is one of the most important aspects of any frequent flyer program. Yet this inventory is not included on most airline sites–especially, which is a horrible site to try to book awards on. However, you can use US Airways miles for great redemptions on Star Alliance partners like Air New Zealand, Singapore Airlines and Lufthansa, and these awards really should be ranked at about the same availability as United miles since they basically pull from the same inventory. That didn’t make it into this study because it was all about using miles to book award seats on the same airline those miles were generated on. So no using Delta miles on Air France or American miles on Cathay Pacific according to IdeaWorks’ methodology.

Miles to points is apples to oranges: Distance-based mileage programs are very different from revenue-based mileage programs, and this study oversimplifies those differences. First, as any mileage runner will tell you, you can get a lot more miles for your dollar on many distance-based carriers, while fixed-value miles are directly based on how much money you spend on the airline. And that’s not even counting lucrative mileage bonuses you can earn through the credit card bonuses I talk about on this site all the time, which tend to be more lucrative for distance-based programs (though hey, I’ll concede the Chase Southwest card 50,000 mile sign-up bonus is pretty great). I bet if you surveyed the savviest flyers, you’d find almost all of them value miles over points, and IdeaWorks just doesn’t seem to get that.

Online booking engines are broken: The study also based its findings on bookings made online–which means, as any of you who have done online booking searches with pretty much any of the legacy carriers but especially Delta whose booking engine I say is broken all the time, but all that means to me is that this is a study of how poorly airlines’ IT departments function rather than an overview of the actual award seat availability on an airline.

Miles’ real value: This also calls into question how best to value your miles. Again, is it a question of overall seat availability or seat availability for the particular routes and classes of service you want to fly? What suits your needs best? The value you get from your points/miles are directly affected by whether they get you where you want to go for your particular needs. Yes, you might be able to find an award seat on a Southwest flight anytime you like that ordinarily would cost you $159–and there are a lot of flyers like that out there and it’s great that this works for them. For my own travel preferences, I’d rather be able to find 1/10 seats in a premium class of service on a popular international route because I could literally get over 10 times the value out of my miles on such a route. To take the other side of this–award seat availability on carriers like JetBlue and Southwest is great because when the price of a ticket goes up, you just have to pay more miles to get that ticket. Well, you can do the same thing on legacies like Delta and American through their Standard/top-tier awards–it just seems more drastic because mileage costs go up higher faster on these for last-seat availability. You can still book them, though.

I do applaud IdeaWorks for trying to figure out what’s going on in the miles and points world and taking airlines to task for how frustrating many of them make it to use your miles. However, I have a hard time agreeing that fixed-value points programs are more valuable solely because they are simpler for the consumer.  What are your thoughts?

Disclaimer: The responses below are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser's responsibility to ensure all posts and/or questions are answered.

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  • D123

    “Well, you can do the same thing on legacies like Delta and American (not on United unless you’re an elite or a cardholder)” Can you clarify what you meant by this? I am interested in booking an award in F using United MP miles for transatlantic travel. My preference of carrier is either LX or LH, but I would consider booking my flight on UA if, after I was ticketed, I could later change carrier to my preferred airline (assuming their seats open up before my date of travel) without paying a penalty. Since I am not elite with United, I am wondering what being “a cardholder” does?

  • thepointsguy

    I was referencing the ability to book an Anytime award for a premium- United reserves that only for select credit cardholders and elites.

    Partner awards, like the ones you are trying to book on Swiss and Lufthansa, are always at the Saver level, so this doesn’t affect you.

  • Brendon McCarthy

    My thoughts in short…I agree with you. For some, points might be better – less frequent travelers?. For other, miles are better – more frequent travelers? In the world of flying, who are there more of?

    My vote. Miles. The day it all turns to points, I won’t care so much about loyalty anymore. I hope that never happens.

    Odd the WSJ posted this? Would not their readers be more of the “miles” types?

  • Baumgadx

    Agree 100% fixed point value systems are very convenient and “easy” to use but as far a “value” goes no question that the miles based system (legacy) are worth more if you’re flexible and diligent.

  • Stvr

    Frankly youre a bit biased because fixed-value systems are too simple to need a full-time BLOGGER to parse. They put you out of business!!!

  • David Lichtman

    “In fact, the two studies came to strikingly similar conclusions, which makes me wonder why they even bothered doing another one.”

    Well, they probably didn’t know the results of the second study before they did it….

  • arcticbull

    And prevent you from flying in business or first class – why I’m here.

  • MJLouise

    You make many interesting points. It just depends on what your goals are. However, their conclusions about certain carrier’s low mileage award availability seems accurate (*cough* Delta *cough*) That is why I am trying to diversity to several different programs — mileage for international trips and last-minute “funeral trips”, flexible programs like AmEx MR and Citi’s TY points and Chase’s UR points.

  • RakSiam

    If they all switched to points I would probably stop playing the game. For me it’s all about premium class seats to Asia.

  • Charlie

    Flexibility is Key. I was looking for a pre avios redemption to Brazil but couldn’t find seats on decent metal in business class. (no old UA recliners please). Instead we got stuck going Cathay Pacific to Bali. The Horror!

    I suppose if I had SW points I could get to Tampa on a milk run through Tulsa…

  • Gary Leff

    “First, they did not factor in partner award availability, which is one of the most important aspects of any frequent flyer program. …So no using Delta miles on Air France or American miles on Cathay Pacific according to IdeaWorks’ methodology.”

    Actually the study DID include partner awards when partner inventory was offered on the airline’s website.

    It’s a terrible study, and limiting to online searches leads to some screwy results as noted. But this wasn’t one of the study’s flaws.

    They limited the range of routes, but if the route in question searched for Delta was also served by Air France, that Air France inventory would have been included. And if US Airways offered a one-stop that was available on the United website, that counted in United’s favor. Some of United’s moving up could be the result of website improvements…

    Yes it’s silly when it doesn’t take into account partners that aren’t online, when it only looks at availability on a given airline’s top routes (when the best ways to redeem miles are often not on those routes, or even on the airline itself but on partners) and when it doesn’t account for how a member wants to use their miles (who cares how good United inventory is between New York and Los Angeles when you want to spend your miles on South America and American’s award inventory there is better?).

  • oldmanpeabody

    Hey TPG:
    It’s an interesting survey and I agree with some of the points you raise, though I do have to side with them on ranking Delta last. I’ve read your post about maximizing use of Skymiles and you have some good techniques but as an ATL resident, I have to Delta’s program overall really is terrible. Now I offer a different perspective because I typically always coach and am looking to maximize my points by using them at the lowest redemption levels, which I think is not an uncommon approach at all amongst non-frequent fliers.

    Anyway, practical example – in the last week, I’ve had occasion to check availability on AA and Delta for 3 separate trips I’m considering – the first is a short hop to Orlando most any weekend May, June or July. Second is a vacation to Costa Rica, Mexico, Belize or someplace like that for which we have tons of flexibility. The third, initiated as a result of the first two, was ATL-Hawaii on any date of the entire next eleven months.

    Obviously a much smaller sample size, but as a practical matter my results echoes their conclusion – AA could do ATL-MCO no problem (though obviously the connection in MIA makes it a bit ridiculous). AA had a decent amount of availability for Costa Rica, Mexico, etc next winter and early spring at their lowest levels – 15k each way, I believe…quite a deal. AA even had a decent amount of ATL-Honolulu flights available next winter/fall for 35k RT, which I thought was amazing (though some did require two stopovers)!!

    And then there was Delta. ZERO flights for any weekend for the ridiculously short hop from ATL-MCO for 25,000 miles. Zero. Out of their hub, Atlanta. A handful (not much selection at all on times) of flights for the (I would say outrageous) 32,500 points. Virtually no availability for Costa Rica, etc. unless we stayed for 8+ days, and even then flights were like 40000 points +. Then, my favorite, absolutely no low-level award availability for any day in the next 11 months to Hawaii. Zero. Not one single day. It’s Hawaii – yeah, I get that. But zero. Not one flight on one day ever

    I’m ready to resign myself to the fact that Delta is just horrible.

  • Dave

    I agree with the other comments here. Though I’m delta loyal, their award availability is awful! I hate hearing the credit card vendors in atl talk about how 25,000 miles is enough for a round trip ticket as if theyre so readily available Hopefully this article will convince them to open up more low award slots.

  • PJ

    Of course Southwest is the best ; this survey will break my wife’s rule: NO pushing on our married daughter and her husband to get the southwest 50K goodies.

    If you are a frugal traveler ( last class traveller), you’ve got to love their program especially with the 50K sign on bonus on Chase Southwest card . Moreover, now Sapphire preferred points can be trasnferred over to SOuthwest 1;1 ratio

  • AlexOlsen

    I agree with your conclusion that fixed value miles are not nearly as valuable. As a Delta Diamond, I will instantly drop them if their rumors of going to fixed value/revenue recognition are true.

    I do not agree with your point about award engines being broken. As an IT consultant, I know how tangible it would be to to ‘fix’ Delta’s award calendar. Delta CHOOSES to not fix it, and their status suffer as a result. So the article is correct in showing the pathetically low rates for Delta redemption.

  • Bob

    “Delta was at a shameful 27.1%. No wonder I’m always having to defend the airline!” Well quit taking free Business Class trips from them and maybe then you would not have to keep defending a company that has a total disregard for their customers…

  • ChiChi_LaRue

    Did this moron Brian Kelly look up who and what IdeaWorks is??? It does consulting to maximize revenues for the airlines, among them AirTran. This “research study” is merely a PR mouthpiece for their airline clients to advocate and influence public opinion moving towards a points-based fixed value systems.

  • J in NC

    I agree that you can get huge value on the international upgrades and if ones fly a lot of international the fixed value will be worst. However, as someone that flies domestic a lot, the Southwest program is awesome mainly because of the no change fee. If I book three tickets for my family on Delta or any other carrier with miles, it’s $450 to change the tickets even by one day (and a total loss if cancelled within 72 hours)! So Southwest allows me to book early when the fixed value is low, then if I wan’t to cancel, I maintain all of my points! I do think having both Delta and Southwest is great because when the miles are more valuable or Delta is the only carrier direct, I use miles, and most of the other times I use Southwest to avoid the change fees.

  • Umut

    For me it’s all about miles. I live in Anchorage, Alaska where it’s so hard to get anywhere in lower 48 under 500 $$ . Thanks to Alaska Airlines monopoly up here. But Unitedmiles are as worth as 5 cents/per mile especially I travel a lot to Istanbul 3 times a year from Anchorage.

  • Charles Clarke

    I thought that with the Delta AMEX, you could always use miles at $.01/mile on tickets. I think it starts at either 10K or 15K and is in chunks of 5K, so you end up paying less than $50 on the AMEX in addition to the points. There you have fixed value and flexible value.

    Having accounts with multiple carriers lets you choose based on the value to you at the time. Though I’m not sure that most folks can keep many programs active.

  • Sean Reeder

    Defending delta and sky pesos again….yawn

  • jobu22

    Great post, I could not agree more! Case in point: I just scored a one way, non stop TLV- LAX coach seat on EL Al for travel in early June using 45,000 AA miles. It was like winning the lottery! Out of curiosity, I priced it on El Al’s site- over $1,800- so what would that have cost in points? Seriously………..

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  • Bill

    after reading that I still have no idea which airline has the best mileage program which is the search I put in google.

  • airline miles programs

    We decided to put together this series, which will outline the process for 6 major programs. Today we are going to start with our favorite, SPG.

  • frjoles

    I have been an Alaska Airlines passenger for decades. Without my knowledge (they say they sent me an email to warn me but it never arrived), they canceled my account with more than 20,000 FF miles in it because I hadn’t flown with them in 2 years. Ridiculous.

    To get them back, I would either have to pay them $75 or sign up for one of their credit cards (I do not like credit cards and pay with cash whenever possible).

    This company used to have character and stood out from the crowd with its customer service. Today, it’s a shadow of its former self. Disappointing customer service, antiquated policies (expiring miles? charging for checked baggage?) and an unwillingness to help a long-standing customer.

    I recommend you use another airline. Or at least, use another FF program. Delta, in which I’ve had points for years, has not canceled my account. Others clearly appreciate their passengers more than Alaska Airlines. And that is unfortunate.

  • Paula Millard

    I have almost 500,000 American Express reward points and some other points on Lufthansa (40,000), United (40,000) British Airways (65,000). My goal is to get my entire family of 5 to Italy late next summer. I have never used any frequent flier miles and am looking for advice on the best way to use the miles. I would appreciate any advice.

  • News

    The answer is Airtran A+ rewards program. You can buy several low-fare tickets but still accrue the same 1 A+ reward per one-way flight (Sometimes they have promotions where you get 3x the points).

    You can also get “elite status” which gives complimentary upgrades and priority seating, after your first 10 flights. You have those flights within 90 days, and then you still need 24 flights for the year, but that totally beats SW, United, AA, and Delta who all require around 30 flights before you get the get these same benefits through their tiers.

    SW unfortunately is considering eliminating A+ rewards for Airtran.

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