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Update 1/1/17: Following a change in policy, it is no longer possible to use hotel transfers to qualify for the Companion Pass.
Continuing his series on the value you’ll get from the various elite tiers in frequent flyer programs, TPG Senior Points & Miles Contributor Nick Ewen takes a look at Southwest Airlines’ Rapid Rewards.
Here at TPG we’re constantly asked questions like, “Is it worth it for me to earn ____ status with ____ airline/hotel chain?” This is an excessively challenging question to answer given the plethora of different traveler profiles out there, but it can be a useful exercise to consider how much each benefit is worth to the average traveler. Earlier this month, I kicked off a revision of last year’s series that quantified the elite status tiers of the major programs. Thus far I’ve analyzed the three major legacy carriers (American AAdvantage, Delta SkyMiles and United MileagePlus) as well as Alaska Airlines. Our next subject is the Southwest Airlines Rapid Rewards 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. You probably have your own way of calculating how much value you can get from these programs; if you (or your company) pays for first or business class, you probably don’t care about complimentary upgrades, while traveling exclusively within the US means you probably don’t care much about lounge access on international itineraries. Just like with any analysis, feel free to adjust the numbers to make it more relevant to your own personal situation.
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. Southwest is a bit different than the four airlines I’ve already considered, as the distance you fly has no bearing on your earning or elite status qualification. Instead you must take a certain number of paid one-way flights or earn a certain number of Tier-Qualifying Points (TQPs), which are based on how much you spend.
For the sake of this post, I’m making the following assumptions:
- You earn 20% more TQPs than the minimum required for the given status level.
- You spend an average of 15 cents per TQP.
- Your travel is evenly spaced across the year.
- You earn your Companion Pass solely through flying and after qualifying for A-List Preferred.
As always, be sure to adjust these numbers based on your given travel patterns. If you (or your company) regularly pays for Business Select, you may qualify for status with fewer flights and won’t utilize the perks as frequently. However, you’d likely have a much higher average than 15 cents per TQP. You also may earn the Companion Pass through other means (like with the Southwest Rapid Rewards Premier Credit Card or by transferring hotel points) and won’t be able to utilize the A-List or A-List Preferred benefits.
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 Southwest points at 1.5 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 Rapid Rewards program land? Here’s my analysis:
The lowest tier in Southwest’s program is A-List status, which normally requires 35,000 TQPs or 25 qualifying one-way flights. For this analysis, I’ll base my numbers on earning 42,000 TQPs at a cost of 15 cents per mile (so a total of $6,300 in spending).
- Priority boarding ($250): The first benefit of A-List status is priority boarding, which is a bit convoluted given Southwest’s boarding process. The official benefit states, “Be one of the first to board with the best available boarding pass,” but the actual details are captured in the program’s Terms & Conditions, which state that a boarding spot will be automatically assigned 36 hours prior to the flight. You are prioritized behind higher-tier elites and Business Select travelers, though ahead of those purchasing Early-Bird Check-In. This should guarantee a boarding pass in Group A, but if you somehow wind up in Group B, you’re still eligible to board with families between the A and B groups. Given that Southwest doesn’t assign seats, this is (in my opinion) a much more valuable benefit than the priority boarding offered by other airlines.
- 25% earning bonus ($160): A-List members enjoy 25% more points than a regular flyer without status. With 42,000 points in a year, that works out to an extra 10,500 points, worth $157.50.
- Standby priority ($100): As an A-List member, you’re prioritized over non-status flyers when standing by for a different flight. However, if you’re traveling on an inexpensive Wanna Get Away fare, you’ll likely need to pay a fare difference to “upgrade” to the new flight no longer has those low fares available.
- Priority check-in and security line access ($200): You’ll also be able to utilize priority lines for both check-in and security. Since Southwest doesn’t charge for checked bags, I have found that its check-in lines can get quite long, so this can be a pretty valuable perk.
- Priority phone line ($50): A-List members also have a dedicated phone line, which can work wonders when you are facing inclement weather or other irregular operations.
A-List Preferred ($2,960)
The second tier in Southwest’s program is A-List Preferred status, which normally requires 70,000 TQPs or 50 qualifying one-way flights. For this analysis, I’ll base my numbers on earning 84,000 points at a cost of 15 cents per mile (so a total of $12,600 in spending).
- Priority boarding ($600): A-List Preferred members also enjoy priority boarding spots assigned 36 hours before the flight, and they’ll be placed ahead of A-List members (though behind those on Business Select fares, who are typically assigned the A1 – A15 slots). I’ve thus upped the benefit to reflect this higher priority as well as double the utilization of A-List members.
- 100% earning bonus ($1,260): As an A-List Preferred member, you’ll take home 100% more points than a regular flyer without status. That’ll double your 84,000 points in a year, worth $1,260.
- Standby priority ($200): You’ll have the same standby priority as A-List members, though you’ll likely utilize it more frequently.
- Priority check-in and security line access ($400): Same benefit, more frequent usage.
- Priority phone line ($100)
- Free in-flight Wi-Fi ($400): One of the key differences between A-List and A-List Preferred is free in-flight Wi-Fi. You simply sign in using your Rapid Rewards account information and can surf the web on all of your flights. The regular price of this service is $8 per day, so I’ll assume a conservative 50 days of flying (which is likely quite low for A-List Preferred members).
Companion Pass ($10,150)
The final tier in Southwest’s program is the Companion Pass. This is technically not an actual elite status, since it can be earned exclusive of A-List or A-List Preferred and thus doesn’t automatically bring any extra benefits (aside from those of the pass itself). It normally requires 110,000 Companion Pass qualifying points or 100 qualifying one-way flights. Note that the flight requirement is the same, but points that count for the Companion Pass are different than TQPs. For example, base points earned from partners as well as all points earned from Southwest credit cards will count toward earning a Companion Pass; these will not count as TQPs for the sake of earning A-List or A-List Preferred status.
For this analysis, I’ll base my numbers on earning exactly 110,000 qualifying points through flying alone at a cost of 15 cents per point (so a total of $16,500 in spending). You’ll thus enjoy not only the benefits of the Companion Pass but also A-List Preferred. Note that if you earn the pass through other means and don’t get to enjoy the A-List Preferred perks, simply use the value from the first bullet.
- Companion Pass ($6,000): Pegging an exact value for the Companion Pass is exceedingly difficult, as it depends entirely on how frequently you utilize it. When I held the pass, my wife and I took a trip at least every two months, though our relatively inflexible work schedules prevented more frequent travel. In addition, when you qualify for the Companion Pass, it’s good for the rest of the year and the entire next calendar year, so you can easily extend the value. This figure assumes that you bring your companion on a total of 20 round-trip flights during the pass’ validity with an average price of $300 each.
- Priority boarding ($900)
- 100% earning bonus ($1,650): If you earn 110,000 points through flying, you’ll earn a 100% bonus as an A-List Preferred member. These extra 110,000 points are worth $1,650.
- Standby priority ($300): You’ll have the same standby priority as A-List members, though you’ll likely utilize it more frequently.
- Priority check-in and security line access ($600): Same benefit, more frequent usage.
- Priority phone line ($100)
- Free in-flight WiFi ($600)
Is It Worth It?
Given these values, is it worth it for you to push for that next elite level? Just like 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).
As I mentioned earlier, it’s incredibly complicated to come up with a specific value for a given program’s elite status levels, as everyone has a different way of quantifying the various benefits offered. Nevertheless, it’s essential to undertake this type of analysis, and I hope this post has given you a framework to apply as you evaluate the Southwest Rapid Rewards program and whether or not it makes sense for you to pursue A-List status.
How do you value Southwest elite status?