Tough love is a really relevant application to the loyalty of frequent flyer miles. There are just times when one has to reward the love with a tough statement or action. Certainly most frequent flyer programs get defensive when they see a critical review of something they have instituted, but there is hope — OK, very slight hope — that they will see it as tough love.
The tough love? I started it with this editorial from InsideFlyer magazine:
The 2008 Dumb Decision Award goes to American AAdvantage. What were they thinking in adding a $5 online award booking fee for their program back on June 21? While this gem was quietly rescinded in early October, it nonetheless stands out for a few reasons. First of all, AAdvantage became the only loyalty program I know of in the world to require some sort of fee to redeem any award. There was no opportunity to redeem an award, no matter how simple or no matter the outlet, without paying at least $5. American suggested that the fee would help them offset the technology investment the airline has been making to its Web site. Correct me if I am wrong, but isn’t the Web site paid for by those members who don’t like to book online and still to this day call a service center and are charged $20? And correct me if I am wrong, but I can’t remember AAdvantage recently introducing anything specifically to their Web site that wasn’t an offshoot from the airlines’ normal reservations Web site. The award calendar? It was launched back in March of 2007. A little late to begin paying for that wouldn’t you think? And all the AAdvantage enhancements were offshoots of price-and-scheduling tools developed for the aa.com Web site. Did this 13-week period really pay for the technology investments? It could be argued that AAdvantage redeemed nearly 850,000 awards during this period. Assuming that 73 percent of these awards were redeemed online at $5 a redemption, minus the exception for their EXP members, that would mean roughly $3 million in special fees. I’m just not getting this decision–absolutely no way to redeem a single AAdvantage award without paying for the privilege. Sorry AAdvantage, love you, but hate seeing you act this dumb.
There are two other programs that can share in this award, but as the industry leader over the years, I place more responsibility for this dumb move in the hands of AAdvantage. But, as we have seen, they did wake up and rescinded that fee for online award redemption.
Today, I’m glad to say that peer pressure and tough love is alive and congrats to Frontier EarlyReturns. They have now seen the light and yesterday announced this:
To better serve our loyal flyers Frontier is eliminating the $25 redemption fee and $75 expedite fee for award redemptions booked on or after December 15, 2008.
So, we are now down to only a single frequent flyer program here in the U.S. that still has a Dumb and Dumber type fee to redeem from your mileage account. And to clarify, I’m not talking about redeeming by contacting the service center — this is about online redemption. The reaming holdout? Glad you asked and it is none other than US Airways Dividend Miles. Here is their last holdout policy:
Online Award Processing fee – $25 continental U.S./Alaska/Canada, $35 Latin America/Caribbean, $50 Hawaii/international
Considering where we were just a month or so ago, life for the frequent flyer is better (I didn’t say best!) but as long as US Airways tries to hold down the best interest of the frequent flyer, we’ll unfortunately have to judge the industry by its dumbest competitor. So what’s it going to be Dividend Miles, Scrooge or lose?
