Virgin America has announced that they will be introducing two elite tiers to their Elevate frequent flyer program, which will go into effect starting August 8, 2012.

The tiers are Silver, which requires 20,000 status points per year (the equivalent of $4,000 worth of spend), and Gold, which requires 50,000 status points per year (the equivalent of $10,000 worth of spend).

If you have the Virgin America Visa credit card, spending $25,000 on the card annually will get you 10,000 points towards status, which is half way to Silver status. Additional spend doesn’t get you any closer to status, though.

The benefits are as follows:

I always find it interesting when a low cost carrier introduces an elite program, since it’s tough for them to be quite as rewarding as legacy carriers can due to their lack of a global route network and alliances in many cases. It’s especially tough for an airline like Virgin America since they have an especially limited route network, and don’t have any North American partner airlines.

But as far as low cost carrier elite programs go, I’d say this is a pretty generous one — priority check-in, priority security, priority boarding, free checked bags, priority seating, “upgrades” to Main Cabin Select 12/24 hours before departure, a points bonus, and a discount on 1-2 tickets annually.

So given what they have to work with, I’m impressed. Still, these thresholds seem really high to me. $4,000-10,000 a year is a lot of spend on a carrier that has such a limited route network. For around $4,000 (and definitely under $10,000)  you can get top tier status with a legacy airline, which gets you substantially more benefits.

I feel like this is a nice “rewards” program for someone that flies Virgin America anyway, though I can’t imagine many people will be switching business to Virgin America because of the program, since I’m convinced benefits are still better with the legacies. So I can’t imagine the program itself will generate much loyalty.

The thing to keep in mind is that since the program is revenue based, it heavily favors those that already purchase Main Cabin Select or First Class seats. Those passengers would already be getting most of the above benefits, so the only real added value of this program is the bonus points and discount on 1-2 tickets annually. I can’t imagine there are that many people that drop $10,000+ on them per year and usually book coach (which is where the greatest benefit would be).

The other interesting thing is that this is a silent devaluation for those that are paying for Main Cabin Select. For those of you not familiar with the product, it’s basically the first row of coach and exit row (meaning you get lots of legroom) and you get free drinks/snacks and priority boarding. One of the other potential benefits is that it’s less likely someone will be in the middle seat since there’s a hefty premium for the seats, and I think now we’ll see the opposite — Main Cabin Select will be less likely to have an empty middle seat than coach, which makes you rethink the whole benefit.

Anyway, it’s not often I say this, but kudos to Virgin America. While it won’t get me to fly them, I commend them on at least trying to launch an elite program.

  1. July 24th, 2012 at 12:58 am

    David said,

    I’m no expert, but having priority for the cheap buy-ups to First may be useful for the trans-cons.

  2. July 24th, 2012 at 2:02 am

    Mac said,

    I think you hit the nail on the head. This is a big improvement for the low-status guy currently flying UA, AS or WN. Probably not anything to jump for the AA Exp’s or 1k’s since the route map is so limited. If you’re an MVP or UA Premier that never gets upgraded however its worth considering.

    While you’re right that main select won’t have empties anymore you’re also getting the chance to fly in F for only $39 o/w (current M-S to F u/g charge) and its a fantastic product for a 500-600 miles flight.

    For those that can hit the 25k in cc spend and take say 5-8 west coast roundtrips/yr that = $1000+ spend with the new VX plan they’ll earn status get free bags, free food, free drinks where as with UA/AS those 500-600 mile o/w’s would earn zilch for status.

    Even better, $1000 in annual airline spend on VX(assuming you could do $2k/mo cc spend) spread over 3 years would earn

    $25k x 3yr CC = 75k VX Points
    +9.25pt/$ x $3000 =~30k VX Points

    105,000 gets you 2 J SFO-LHR on VS if you can cough up the $1200 ea in YQ. An interesting value prop for the guy that needs to fly up and down the West coast every other month.

  3. July 24th, 2012 at 7:47 am

    jmd001 said,

    You didn’t mention the best gimmick of all: Earn the most points during the first year of the program, and get a free ride on Virgin Galactic!!! :) (Currently priced at $200K, I believe)

  4. July 24th, 2012 at 9:02 am

    Michael said,

    They are going after the studio contracts on the La-JFK runs

  5. July 24th, 2012 at 4:13 pm

    lucky said,

    @ Michael — You’re saying they’re going after studio contracts by creating a loyalty program? Not sure I follow.

  6. July 25th, 2012 at 12:42 am

    Nick said,

    There is actually quite a big class of business flyers who fly a few times a year but spend more than $4K domestic. But I’m quite happy buying more expensive fares on United and playing the upgrade game, I’m not spending out of my own pocket on upgrades.

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