How frequent flyers trade loyalty to currency
Like Pokemon Go loyalty programmes keep appearing in the most unlikely places, from your local coffee shop to the carwash. Sometimes the rewards don’t justify the effort of signing up, but when there’s an overseas trip or two on the line perhaps it’s worth paying attention.
The idea of rewarding customers for their loyalty is thought to date back to the late 18th century, when American retailers began offering copper tokens which could be redeemed for a future purchase. Stamps later replaced the costly copper, but it was only in 1981 that the first modern, mainstream loyalty programme was launched. It was American Airline’s Frequent Flyer programme.
Competitors soon rushed to embrace the idea and airline loyalty programmes eventually paved the way for that card in your wallet which might, someday, get you a free movie.
Of course airline loyalty programmes have evolved hugely over the past 35 years and members can now earn rewards for other travel-linked purchases such as car hire and hotel accommodation. The drawcard of travel as a reward has also led to other partners, from banks to fuel retailers, to align their programmes so customers can earn flights.
Edward Frost, British Airways commercial manager for southern and East Africa, concedes that the increased complexity as more partners and opportunities to earn and burn rewards have been added can be bewildering. He has four suggestions to ensure you’re getting the best from a loyalty programme.
Understand the difference between rewards and benefits
The most basic premise of loyalty programmes is they reward you for repeat custom with a company or any of the programme partners. Usually this takes the form of points, miles, or in the case of the British Airways’ Executive Club, Avios. Once you’ve accumulated enough of this ‘loyalty currency’ you can exchange it for reward such as a flight or cabin upgrade.
But many airline loyalty programmes also offer benefits over-and-above the rewards. These determine your level of membership, typically through tiers such as blue, bronze, silver and gold. As you progress through the tiers you earn more benefits. For example Executive Club Silver and Gold members get access to over 250 airline lounges across the world. Other benefits can include free seat selection from the time of booking, priority boarding and additional baggage allowances.
Executive Club members progress up the tiers by earning Tier Points. Unlike Avios, these cannot be bought, shared or spent – their sole purpose is to move you through the levels. The number that are earned on each flight depends on the ticket type, fare class and route. Generally you’ll earn more on longer flights, in premium cabins and on flexible fares.
Actively manage your account
This is the easiest way of keeping track of your mileage balances, redemption options, including the specials that many programmes offer from time to time, as well as making sure that all your flights are being tracked.
Besides being able to track transactions and book flights, The Manage My Account functionality on the Executive Club website also allows you to upload advance passenger information, saving you time at check-in.
Maximise your earning potential
Most of the larger loyalty programmes have multiple partners and members are unlikely to do business with them all. Still, it is worth familiarising yourself with the partners and earn the rewards where you can. For example if you need to hire a car, it makes sense to hire it from a programme partner and earn the rewards and also possibly benefits, such as fast-track service or an upgrade due to your tier status.
Some programmes also offer other ways to boost your rewards balance. The Executive Club has a Household Account. This enables up to six people in a family, including children, to pool their Avios.
Claim your rewards (early)
A common frustration members have with frequent flyer programmes is that they aren’t able to book redemption flights when they want them. One of the reasons for this is every member of the programme, anywhere in the world has access to the redemption seats on a flight. If you leave it until November to try and book a flight to London so you can visit relatives at Christmas, you could struggle. This is because someone visiting South Africa from New York via London booked the seat nine months earlier.
The universal top tip for booking redemption flights is to do it as early as possible. The other thing to bear in mind is that airline alliances now mean you have much more choice. For example if you’re planning a Mediterranean holiday and can’t get seats on the British Airways’ flights you want, you can try its oneworld partner, Iberia. Similarly, if you’re flying to the United States you have a choice of British Airways, American Airlines and US Airways across the Atlantic, all joint business partners.
Also consider that there are other ways of using Avios, including cabin upgrades.