Frequent Flyer

From Delta: "Even More Ways to Use Miles"


Tim Winship
Tim Winship
Delta Airplane Airfare Sale

    As any mileage-collector will readily confirm, the more options for redeeming points, the better. But the savvy mileage-collector will be quick to ask the follow-up question: When redeemed for _____ (fill in the blank), how much are my miles worth?

    Years ago, when the average price of a domestic roundtrip ticket was close to $500, the industry-standard price for a frequent-flyer award ticket was 25,000 miles. While a more detailed analysis would deduct somewhat for the hassle factor of booking a capacity-controlled award ticket versus a revenue ticket, the benchmark value of a frequent-flyer mile was generally assumed to be around 2 cents.

    Of course, you could get more or less per-mile value, by booking more or less expensive award flights. But the average traveler was more interested in convenience than in squeezing extra value from his points.



    Related: U.S. Carriers Fare Badly in Latest Global Airline Survey



    When redeemed for non-travel awards, the return-on-investment has always been much less. Want to cash in miles for an iPad? Fine, but expect to get less than 1 cent per mile in redemption value.

    In the years since 2-cents-a-mile was the standard, the value of a mile has steadily eroded, in the process significantly devaluing airline loyalty programs themselves, at least for average travelers who earn more of their miles from credit-card charges than from flying.



    New Delta Redemption Options



    Delta, for one, has signaled, both in public pronouncements and in its award pricing, that it wants the value of a SkyMiles mile pegged at 1 cent apiece.

    This week,

    Delta

    added the following to the list of services for which SkyMiles members can redeem their miles:


    • Upgrades to Delta Comfort+, first class, or Delta One
    • Selecting Preferred Seats
    • Ticket change fees
    • Award-ticket redeposit fees
    • Same-day confirmed fees
    • External ticket charges



      Looking at using miles to upgrade to Comfort+ or first class, 5,000 miles can be redeemed in exchange for a $50 discount on the upgrade price. So exactly 1 cent per mile. And that's best case. Because the pricing is based on 5,000-mile increments, you'll be getting less than 1 cent when redeeming for intermediate amounts.

      To the extent that it's possible to quantify, the other new redemption options also yield a per-mile value of 1 cent, or less.

      Bottom line: Assuming you're earning most of your miles for credit-card use, at a rate of one mile for every $1 spent, getting 1 cent per redeemed mile amounts to a 1 percent rebate.



      Reader Reality Check



      At what point do airline loyalty programs become irrelevant to you?
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  • After 20 years working in the travel industry, and 15 years writing about it, Tim Winship knows a thing or two about travel. Follow him on Twitter@twinship.