What’s The Right Way to Compare Frequent Flyer Programs?
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It’s not easy figuring out which travel loyalty programs are the good ones and which are lacking. That’s why we here at The Points Guy try to provide all the news, tools and reviews you need to make educated decisions about where to bank your points, which travel credit cards to get and what flights to take in order to truly maximize your frequent flyer miles.
But with so much information out there to digest, it’s important to know what’s accurate and what’s misleading. An example of the latter came out earlier this week when IdeaWorks released its most recent survey, sponsored by CarTrawler, on frequent flyer award availability. The report, which was covered by The Wall Street Journal and others, purports to rank airlines based on how easy it is to find an available award seat.
While we’re all for providing as much information as possible in the points and miles sphere, when it comes to the IdeaWorks survey, the company’s methodology is somewhat flawed. To understand how, let’s review some of the basics of frequent flyer programs and why trying to compare availability across multiple airlines isn’t as simple as IdeaWorks makes it out to be.
Not All Frequent Flyer Programs Work The Same Way
There are basically two different models when it comes to frequent flyer programs — chart-based programs and fixed-value programs. Chart-based programs rely on preset regions or distances to determine how many miles a trip will cost. In a chart-based program, an economy flight from the US to Europe might run 30,000 miles each way, regardless of whether the actual ticket is selling for $200 or $800 in cash. In addition to Alaska Airlines, the US legacy carriers such as American, Delta and United all use chart-based programs (even though Delta pulled its charts from public view a few years ago, it still uses region definitions internally).
On the other hand, fixed-value programs peg the value of each point to a fixed amount, and then allow the number of points required for a trip to fluctuate with the cash price of a ticket. So if each point is worth 1.3 cents, a $200 ticket will cost 15,384 points, but if that ticket climbs to $800, it will now cost 61,538 points. Southwest and JetBlue employ fixed-value systems.
How does this info factor into in a survey on award space? Well, when it comes to award availability, fixed-value programs always have nearly 100% availability, while chart-based programs don’t. That’s because fixed-value programs can increase the number of points required for popular (and therefore expensive) flights, so there’s no danger of those programs going bankrupt from cheap redemptions. On the other hand, chart-based programs control their costs by limiting seats, since they’re locked into a specific points price for each route. So comparing fixed-value availability to chart-based availability is like comparing apples and oranges.
The flip side of this equation is you can get a lot more value from chart-based programs than you can from fixed-value programs — you’re basically trading availability for value. Southwest, with its fixed-value points, has perfect availability in the IdeaWorks survey, but you’ll never get more than 1.5 cents per point in Southwest’s program no matter what you do. On the other hand, while an airline like United may not have an open award seat on the Friday before Memorial Day weekend, on the days it does have seats, you can get a lot more than 1.5 cents per mile for a redemption. Which brings us to…
Economy Availability vs. Premium Cabin Availability
One of the best features about points and miles is getting the chance to redeem them for fantastic first and business class seats that would otherwise cost thousands of dollars and be out of reach for many. But award availability in those premium cabins can be tricky to find. Economy availability is often easier, especially on international flights.
Yet oddly, the IdeaWorks survey doesn’t differentiate between the two — it just lumps “availability” all into one overall ranking. In fact, it’s not even clear if the study even looked at premium cabin availability, as it isn’t noted anywhere in the methodology section of the public release.
Yes, there are certainly travelers who are only interested in using their points and miles to fly in economy (though perhaps that’s a smaller percentage among TPG readers), but for an award availability study to assume that all availability is one and the same seems like an odd choice to make. It also leads us to another missing piece of the award space puzzle, which is that…
Partners Matter — They Really Matter
As intermediate and advanced points and miles collectors know, earning miles with a particular airline doesn’t mean you’ll necessarily want to redeem those miles on that same airline. In fact, the very best redemptions are often on an airline’s partners, especially for long-haul international flights.
For instance, the IdeaWorks survey reports that availability on American Airlines has drastically improved in the last year — by as much as 25% according to IdeaWorks. That might be the case if you ignore the fact that much of that new AA availability is only on married segments and/or multi-stop connections. But anyone who searches for AA award space on a regular basis (as we do here at TPG) can tell you for a fact that international premium cabin space on American’s own flights remains abysmal. If you’re hoping to fly to Europe or Asia on an AA plane with AAdvantage miles in business or first class, you definitely have not seen a 25% improvement in award availability over the past 12 months.
But that’s why partner availability is so important, because if you do want to use AAdvantage miles to fly to Asia, you’ll have much better luck using them to book in business or first class on Cathay Pacific or Japan Airlines. Of course, you won’t find that award space on aa.com — you’ll need to search for it another way and then call American to book it. You also won’t find it included in the IdeaWorks survey, which oddly ranks Cathay Pacific availability below American’s own availability in its long-haul rankings. But it’s there, and it’s a vastly better way to utilize your AA miles than burning them on a 2-stop connection from Tampa (TPA) to New York LaGuardia (LGA).
A Fair Ranking of Frequent Flyer Programs
Our purpose in analyzing this study isn’t to trash IdeaWorks — again, we appreciate that the company is adding to the points and miles discourse. Rather, it’s to remind you that award availability is just one variable in an overall frequent flyer program. A fair ranking needs to take into account both the value and type of each program’s points and miles, plus premium cabin and partner availability, and then also how many economy award seats are available on the airline’s own flights.
So what really is the best frequent flyer program? It depends on where you want to go and how you want to get there. Every program has its strengths and weaknesses — you probably don’t want to collect American miles if you want to go to Europe in business, but United miles can be great for booking Lufthansa first class to Frankfurt. But learning all the ins and outs by reading the resources here at TPG is how you’ll find the program that works best for you.
Featured photo of Japan Airlines (JAL) first class on the 777-300ER by Eric Rosen / The Points Guy.
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