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If you’re wondering whether it’s worth meeting the requirements for a specific frequent flyer status, it helps to know what sort of value you can expect as an elite member. Below, TPG Senior Points & Miles Contributor Nick Ewen kicks off a series on elite statuses by examining how much value you can get with the different levels of the AAdvantage program.
Here at TPG we’re constantly asked questions like, “Is it worth it for me to earn ____ status with ____ airline/hotel chain?” While there’s no easy answer to this question, it can be helpful to crunch the numbers and try to put a value on the elite status levels of each loyalty program. Today, I’m kicking off a revision of last year’s series that considers the various benefits of each tier of the major programs and tries to quantify the value of each. Our first subject: the American Airlines AAdvantage program.
Before we get to the analysis, a couple of disclaimers. First, it’s important to note that these mathematical analyses represent just one way of calculating the value you’d get out of a given elite status level. Everyone has his or her own way of valuing the various benefits of loyalty programs; some may always pay for first and business class and thus have no need for complimentary upgrades, while others may travel exclusively in the US and don’t care about free lounge access on international itineraries. As a result, feel free to adjust the numbers I use to make it more relevant to your own personal valuation.
Second, these numbers are all based on the benefits you’d enjoy after achieving the given status level and continuing to qualify each year thereafter. If you’re starting from scratch or if you suddenly have a drop-off in your travel, the calculations become significantly more complicated.
This brings me to the third and final critical part of this analysis: the underlying assumptions I’m making. To really hit a value for benefits, I have to assume a certain amount of flying and a corresponding amount of spending. For the sake of the airline portion of the series, I’m making the following assumptions:
- You earn 20% more Elite Qualifying Miles (EQMs) than the minimum required for the given status level.
- You spend an average of 15 cents per EQM.
- Your travel is evenly spaced across the year (which is critical for American, given the upcoming changes to the AAdvantage program).
As always, be sure to adjust these numbers based on your given travel patterns. Those who travel exclusively in the US may spend less than $0.15 per mile, while those who travel in paid first or business class internationally likely spend significantly more. You also may qualify on segments rather than miles, and you may have heavier travel in certain parts of the year.
Two final bits of information: For the sake of this analysis, I’m valuing any bonus miles earned based on TPG’s most recent valuations, which peg AAdvantage miles at 1.7 cents apiece. In addition, I’m rounding all of the individual benefit valuations to the nearest $5 to make the math a bit simpler.
So … all that being said, where do the three elite levels of the AAdvantage program land? Here’s my analysis:
AAdvantage Gold ($1,155)
The lowest tier in American’s program is AAdvantage Gold status, which normally requires 25,000 EQMs or 30 elite-qualifying segments. For this analysis, I will base my numbers on earning 30,000 EQMs at a cost of 15 cents per mile (so a total spend of $4,500).
- Upgrades on flights under 500 miles ($100): When the Dividend Miles and AAdvantage programs combined back in March 2015, this was a new benefit for AAdvantage elites. These upgrades clear after Executive Platinum and Platinum members and only within 24 hours of the flight, and unfortunately, you don’t have a ton of time to utilize in-flight perks on such short flights. Nevertheless, it’s still better than using stickers! Speaking of which…
- 500-mile upgrades ($320): AAdvantage elite members currently earn four 500-mile upgrades for every 10,000 EQMs flown, though this threshold jumps to 12,500 EQMs as of March 1, 2016. You can then redeem them toward upgrades on longer flights; each one covers 500 miles of flight distance, so a flight of 1,400 miles would require three 500-mile upgrades to confirm into first class. 30,000 EQMs during 2016 would earn you eight of these upgrades, though your priority would fall below Executive Platinum and Platinum members. Since you can purchase additional 500-mile upgrades for $40 (as of March 1), I’m pegging these at face value.
- 25% mileage bonus, first half of 2016 ($65): For the first half of 2016, you’ll still earn redeemable miles on American based on distance flown, and AAdvantage Gold members receive 25% more miles than members with no status. At 15,000 EQMs, that works out to an extra 3,750 miles, worth $63.75 based on TPG’s most recent valuations.
- Mileage bonus, second half of 2016 ($75): In the second half of 2016, American will revert to a revenue-based formula for earning miles on flights that it
copiedborrowed from United and Delta. Gold members will earn an extra 2 miles per dollar spent on base airfare when compared to members with no status, so with your travel evenly distributed across the year, you’d take home an extra 4,500 miles ([$4,500 / 2] x 2 miles per dollar = 4,500 miles), worth $76.50.
- Priority check-in, security and boarding ($100): With mobile check-in options and fast-track security options like TSA PreCheck, these benefits aren’t necessarily as valuable as they were in the past. Still, they can be a lifesaver if you’re running late or are trying to snag overhead space.
- Checked bag fee waiver ($95): A Gold member enjoys a free checked bag on all American flights, saving up to $50 on every domestic round-trip. However, this is also a benefit on most American co-branded credit cards (like the Citi / AAdvantage Platinum Select World Elite Mastercard), so it’s hard to value this higher than the $99 annual fee on that that card (which is waived for the first 12 months).
- Complimentary same-day standby ($75): Gold members can also standby on an earlier or later domestic flight for free, saving $75 each time they utilize this option. However, you’ll still need to pay if you want to confirm a seat on the new flight. I’ll assume that you’ll use this once each year, though if you frequently need or want to change your flight at the last minute, you may get more value out of it.
- Priority phone line ($50): This benefit may help out when you really need to make a change or are dealing with a significant weather event, but it’s likely not the most valuable perk out there.
- Complimentary preferred seats ($150): As an AAdvantage Gold member, you can choose preferred seats at the time of booking or enjoy a 50% discount off Main Cabin Extra seats (the latter of which become free within 24 hours of your flight).
- Waived award processing charge ($75): Gold members also won’t pay the $75 award processing charge when booking an award ticket within 21 days of departure. As with same-day standby, I’ll assume that you’ll utilize this once.
- Partner benefits ($50): When you travel on a Oneworld carrier, you’ll enjoy Ruby privileges, though that’s limited to priority check-in and standby. On Alaska Airlines flights, you’ll get priority check-in and boarding along with two free checked bags. If you regularly fly with these partners, of course, the value of these benefits can skyrocket.
AAdvantage Platinum ($2,840)
American’s mid-tier elite status level is AAdvantage Platinum, which normally requires 50,000 EQMs or 60 elite-qualifying segments. For this analysis, I will base my numbers on earning 60,000 EQMs at a cost of 15 cents per mile (so a total of $9,000 in spending).
- Upgrades on flights under 500 miles ($200): This is the same benefit offered to Gold members, though I’ve doubled the valuation based on the fact that you’re flying twice as much. These upgrades (as well as 500-mile upgrades) will start clearing three days prior to your flight.
- 500-mile upgrades ($800): As a Platinum AAdvantage member with 60,000 EQMs of flying evenly spaced across the year, you’d actually earn four 500-mile upgrades by March 1 and then another 16 over the rest of the year. Since you’re higher on American’s upgrade priority chart, these are likely a bit more useable, but I’m going to stick with my face-value number of $40 apiece.
- 100% mileage bonus, first half of 2016 ($510): AAdvantage Platinum members earn a 100% mileage bonus for the first half of the year. At 30,000 EQMs, that works out to an extra 30,000 miles, worth $510.
- Mileage bonus, second half of 2016 ($230): When American switches to a revenue-based model for accruing redeemable miles, Platinum members will earn an extra 3 miles per dollar spent on base airfare when compared to members with no status. Again, assuming your travel is evenly distributed across the year, you’d take home an extra 13,500 miles ([$9,000 / 2] x 3 miles per dollar = 13,500 miles), worth $229.50.
- Priority check-in, security, and boarding ($200): This benefit is the same as Gold members, though as with the short-haul upgrades, I’m doubling the value based on twice as much utilization.
- Checked bag fee waiver ($200): Platinum members can check two bags for free on American flights, saving up to $120 on round-trip domestic itineraries and up to $200 on round-trip transatlantic flights. If you regularly travel with a ton of gear or typically fly across the Atlantic in economy, this perk can be significantly more valuable.
- Priority baggage delivery ($25): I have personally found that priority baggage delivery is hit or miss across most airlines, but if you’re in a rush, this is a nice benefit to have.
- Complimentary same-day standby ($150): Like Gold members, Platinum flyers can standby on an earlier or later flight for free, saving $75 each time. I’ll assume that you’ll use this twice during the year.
- Priority phone line ($50): Having access to priority phone support can be huge when your travel is disrupted, and I’m again doubling the value based on double the travel.
- Complimentary preferred seats ($300): As a Platinum member, you can select both preferred seats and Main Cabin Extra seats at the time of booking. This can be a big moneysaver, especially on longer flights.
- Waived award processing charge ($75): Platinum members also won’t pay the $75 award processing charge for redemptions within 21 days of departure. I’m keeping the value at $75, since I don’t think many members book more than one award ticket that close to departure.
- Partner benefits ($100): Travel on Oneworld airlines gives you Sapphire benefits, which includes priority check-in, standby and boarding along with lounge access when flying internationally in any class. When traveling on Alaska, Platinums enjoy the same priority check-in and boarding as Gold members but also can access preferred seating for free.
AAdvantage Executive Platinum ($7,490)
American’s top-tier elite status level is AAdvantage Executive Platinum (one that TPG loves); it normally requires 100,000 EQMs or 120 elite-qualifying segments. For this analysis, I will base my numbers on earning 120,000 EQMs at a cost of 15 cents per mile (so a total spend of $18,000).
- Unlimited, complimentary upgrades ($1,500): Unlike other AAdvantage elite levels, Executive Platinum members enjoy complimentary upgrades on all American flights domestically and between the US and Canada, Mexico, the Caribbean and Central America. You’ll also enjoy the highest priority for these upgrades, as they’ll clear up to 100 hours in advance.
- Four systemwide upgrades ($2,000): American gives Executive Platinum members 4 systemwide upgrades each year (down from 8 in the 2015 program), and you can earn another four: two for hitting 150,000 EQMs and another two for hitting 200,000 EQMs. These can be used to upgrade any paid ticket on American metal with up to three segments and can be given to friends or family members as well. You just need to find upgradeable space (U for business class and Z for first class); ExpertFlyer can be a great tool for this endeavor. Though the difference between paid coach and paid business class can often be thousands of dollars, I’m going to peg these at $500 apiece.
- 100% mileage bonus, first half of 2016 ($1,020): AAdvantage Executive Platinum members earn a 100% mileage bonus for the first half of the year. At 60,000 EQMs, that works out to an extra 60,000 miles, worth $1,020.
- Mileage bonus, second half of 2016 ($920): Executive Platinum members will enjoy the best rates when American switches to a revenue-based model for redeemable miles, as they’ll earn an extra 6 miles per dollar spent on base airfare when compared to members with no status. Again, assuming your travel is evenly distributed across the year, you’d take home an extra 54,000 miles ([$18,000 / 2] x 6 miles per $ = 54,000 miles), worth $918.
- Priority check-in, security, and boarding ($400)
- Checked bag fee waiver ($300): As an Executive Platinum member, you can check up to three bags free on all American operated flights. This can come in handy when you need it but likely isn’t that valuable for the average traveler.
- Priority baggage delivery ($25)
- Complimentary same-day standby ($150): This is the same benefit offered to lower-level elites, but I’m pegging it at the same $150 as Platinum because of the next benefit…
- Complimentary same-day flight change ($150): There’s no need to do free standby when you can get confirmed on a flight without a fee! This usually costs $75 to non-Executive Platinum members (or $150 for flights between New York-JFK and London-Heathrow), but how much value you’ll get depends on how frequently you need to make these last-minute changes. I’m assuming a conservative utilization of twice per year.
- Priority phone line ($100)
- Complimentary preferred seats ($300): Executive Platinum members can select preferred and Main Cabin Extra seats at the time of ticketing, though I’m pegging this at the same value as Platinum flyers simply because you’ll likely be riding up front a decent amount of the time and thus won’t need this benefit.
- Complimentary alcoholic beverage and snack in the Main Cabin ($50): You’d ideally be traveling in first or business class most of the time as an Executive Platinum member, though if your upgrade doesn’t clear, it’s at least nice to have a drink and snack on the house.
- Waived award processing charge ($75)
- Waived award change and cancellation fees ($300): One of my favorite elite status benefits is the ability to change and cancel award tickets for free, and you’re able to do that as an AAdvantage Executive Platinum. Keep in mind that American already has one of the more generous change/cancellation policies out there, as any member can modify his/her date or routing without a fee. However, changes to the airline(s), award type or origin/destination would require a $150 fee, so these two fee waivers can help an Executive Platinum member really get the best itinerary possible.
- Oneworld benefits ($100): When you travel on Oneworld airlines as an Executive Platinum, you’ll enjoy Emerald benefits, including priority check-in, standby, boarding and security along with access to first and business class lounges when traveling internationally in any class of service.
- Alaska benefits ($100): Executive Platinum members have the same benefits on Alaska as Platinums: priority check-in/boarding, bag fee waivers and access to preferred seating.
Is It Worth It?
So given these values, is it worth it for you to push for that next elite level? As with any analysis, there isn’t an easy answer to that question, as it entirely depends on your travel patterns. Here are some questions to ask yourself to help make this decision:
1. How much will you be traveling in the future? If you go out of your way to earn a given elite status level, it would be a shame to not utilize the benefits as much as you’d like.
2. What’s the incremental value of one level over another? If you’re close to qualifying for the next level, consider the additional (or enhanced) benefits you’d get. There’s no sense in taking a mileage run to earn a higher status when the additional perks you’d get don’t matter to you.
3. Would you sacrifice price or convenience for elite status? One of the hardest things to quantify in this hobby is whether or not it’s worth booking with your preferred carrier if it isn’t the most convenient or cheapest. As the father of a fourteen-month-old, I have come to love the nonstop flight both when traveling for work and for fun. As a result, I typically don’t go out of my way to fly a particular airline; if JetBlue is the best option, I’ll do it!
While the answers to these questions won’t give you an absolute answer, they can help bring out the key considerations to be made as you’re deciding whether you want to push for the next status level (or whether you want to earn status at all).
Putting a concrete number on any elite status level is a challenging endeavor, as everyone has different ways of valuing each benefit and varying travel patterns. Still, it’s important to crunch the numbers to make sure that you’re making the most of your travel decisions, and hopefully this analysis has given you a framework to which you can apply your own logic to decide if American elite status is for you.
How do you value AAdvantage elite status?
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