With all of the changes to airline loyalty programs lately, the way we earn and spend points is evolving. This evolution means points are valued differently now. People have been able to buy points for a long time, and according to the points gurus there are times when this is a good deal. I was trying to explain this to the Home Warrior on a recent road trip, and we got into a Great Debate.
He just couldn’t fathom that people would be willing to pay for miles, getting no other benefit. I tried to explain that it was a rare thing for it to be worth it, but it was still hard for him to get. Eventually, he gave an alternate theory: that if people were given the option to pay less on the ticket and get no miles, most people would take it. The reasoning is that eventually you would save enough money to buy your ticket, making the points unnecessary. Per usual, this made me curious, so I have to ask you guys.
Assume this hypothetical. A round trip ticket costs $200. You are given the option to purchase the ticket for $175 but get no miles. You would still get credit toward status.
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I answered yes but with exceptions. With my main programs I’d say no or at least think harder about the choice. It would depend on what I needed the miles for and how much I would be getting. Last week I was flying Austrian Airline. I booked 4 much cheaper flights that were on a non earning rate. Participation in their program didn’t matter to me. If it was with one of my primary airlines, my choice might had been different. I fly completely on my own money.
If the cash difference is great enough, I would argue the majority of the people travelling would gladly opt for no miles. Low cost carrier travel is booming, after all.
I would consider the value of the points earned – if the trip was a US transcon earning ~5,000 miles, a $25 difference in fare would not make it worth it. If it was a 400 mile hop, then yet it would be worth it.
However, I recently did a US-Europe open jaw mostly purchased (50,000 of 60,000 miles) with US Airways points during a 100% transfer bonus promo for the equivalent (as if I bought all 60,000 points this way) of $820 after taxes and fees.
The cheapest airfare I could find for any similar open jaw trip on those dates was $1130. I’d value 8,000 miles at less than $310.
How many points, in which program 🙂
On a $200 fare I doubt the points you could earn would be worth more than $25.
But the real question is, why are you paying cash for the flight in the first place? $200 sounds like a short haul, book with Avios (big grin)
Omg, hb, I love avios so much. It’s such a good deal and I’m dreading the day the distance-based award disappears because I know they must be losing so much money on it. One of maybe 20 examples:
I desperately needed a last-minute flight to nyc (from DTW) a few months ago but couldn’t find anything that fit my schedule for less than $700, when I saw there was award space available on american (so lucky!) I bought 5000 avios for like $150. And then american cancelled the flight (so typical!) and re-booked me a revenue ticket, so i ended up getting the miles anyway (11% avios rebate? Haha)