Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world.
+1 212 318 2000
Europe, Middle East, & Africa
+44 20 7330 7500
+65 6212 1000
They lure millions of travelers each year with the promise of free vacations, first-class upgrades and a chance to cut the security line. But are frequent-flier programs really worthwhile?
Miles programs sound simple enough. Passengers typically earn one mile or point for every mile flown. Those miles can be redeemed for free trips, usually starting at 25,000 miles for a domestic, round-trip flight.
Loyalists say not participating is like leaving free money on the table. Free flights are the most obvious perk. Miles can also be traded in for things like magazine subscriptions.
Others argue the programs are difficult to maintain and aren't of much value to travelers who fly only once or twice a year. And they say there's no guarantee of getting the flight you want.
It's been 30 years since the first frequent-flier program was created. Today, airlines make more than $4 billion a year combined from program partnerships -- topping the reported revenue from baggage fees. There are an estimated 90 million U.S. frequent-flier members with 2 trillion unused miles.
As families head out on their summer vacations, they're once again debating the merits of signing up.
Here, Associated Press Airlines Writers Samantha Bomkamp and Scott Mayerowitz argue the programs' worth:
Mayerowitz: It's a no-brainer. Travelers taking only one or two trips in a year can benefit with minimal hassle and no cost. You won't be upgraded to first class, but there are still plenty of perks. Just one round-trip flight between Washington, D.C., and Orlando, Fla., earns enough miles for a magazine subscription.
Bomkamp: Most travelers don't care about getting a free Sports Illustrated or Entertainment Weekly in their mailbox. They're lured to the programs by upgrades that are hard to snag and free tickets that can be impossible to redeem. And if they focus too much on racking up miles, they may miss out on cheap flights.
Mayerowitz: Hey, free is free. And loyalty doesn't only pertain to the airlines. Some hotel programs are particularly generous to even the lowest-tiered members, giving away mini-bar credits or free Wi-Fi. With car rental companies, the perk is precious vacation minutes: you can skip the check-in counter and walk straight to a car.
Bomkamp: What's your time worth? With the sheer number and complicated nature of frequent-traveler programs, they're too much trouble to keep track of for too little gain. There are at least a dozen airline programs in the U.S. alone, and more than 20 hotel loyalty plans. Who wants a wallet full of cards and three dozen extra usernames and passwords?
Mayerowitz: Free sites like AwardWallet, MileTracker and Points.com keep track of login information, point balances and provide warnings about expiring points.
Bomkamp: Sure, that helps -- unless you have lots of time between tallies. If you travel twice a year like the average American, it would take you at least six years to be eligible for a free flight on most U.S. carriers.
Mayerowitz: There are plenty of ways for those average Americans to earn miles without traveling. Many credit cards offer a generous signup bonus -- often large enough for a free domestic flight -- and waive the annual fee the first year. For online shoppers, airline and hotel shopping portals allow you to earn points at retailers such as Best Buy, Gap and L.L. Bean. Linking your credit card to a Rewards Network account could get thousands of extra miles just for eating out. Banks such as BankDirect and stockbrokers including TD Ameritrade and Fidelity offer signup bonuses for new accounts.
Bomkamp: Most airline credit cards have higher interest rates and annual fees than traditional cards, making them a lousy deal and not worth the possible "free" trip down the road.
Mayerowitz: I will admit that if you can't pay your credit card bill in full each month, branded cards aren't a good option. You are right; the high interest rates aren't worth the free trips.
Bomkamp: Here's another problem: Miles and points with some airline and hotel programs expire in as little as a year.
Mayerowitz: It's easy to keep miles alive. Even without stepping on a plane. For example, miles with American expire after 18 months of inactivity. But just one 99-cent song purchase at iTunes -- though American's shopping portal -- keeps your miles active for another 18 months.
Bomkamp: Alright, fine. But good luck redeeming them. A recent industry survey showed that on some of the stingier airlines, passengers were only able to find award tickets doe one in every four flights they wanted.
Mayerowitz: Yeah, it's often a pain to redeem miles. But with some advance planning and flexibility on your travel dates you can get a free ticket. And airline partnerships do provide more choices to earn and redeem miles. So if you can't get a seat on Delta to Paris, maybe its partner Air France will have a seat. Maybe.
Bomkamp: See? That's a hassle. I'm just going to search for the cheapest tickets, and spend my spare time watching reruns of "Gilligan's Island."
Mayerowitz: Do what you want. I'll send you a postcard from Hawaii.
Samantha Bomkamp can be reached at http://twitter.com/SamWillTravel
Scott Mayerowitz can be reached at http://twitter.com/GlobeTrotScott