By Mitch Lipka
July 30 (Reuters) - Earning and using airline miles used to
be simple. Fly 25,000 miles and earn a free flight. It is not so
simple anymore.
The process of redeeming miles is changing in a way that
makes it more difficult for all but elite flyers to earn
rewards.
One key change: Delta Air Lines' DAL.N announcement in
mid-July that its SkyMiles rewards will be based on what you
spend, rather than on the distance you travel, and the cost will
be based on demand rather than a fixed amount.
Experts like Brian Kelly, known as The Points Guy (http://thepointsguy.com/),
expect more major airlines to follow suit.
To help sort out the changes to the miles game, Reuters
asked Kelly for his advice for travelers to best take advantage
of widely varying airline loyalty programs.
Q: Are airlines suddenly being less loyal to their loyal
customers?
A: The real answer is that loyalty is being redefined.
In the past it used to be that whoever flew the most was the
most loyal, but airlines are now saying it's whoever spends the
most.
Basically, the wealth gap is increasing between economy and
first class, which I guess makes senses as the industry keeps
changing.
Q: It seems like all the airlines are treating miles like
currency, and devaluing them.
A: Pretty much. Every month there are billions of points and
miles pumped into the system. But there are just not that many
flights, or hotels for that matter, so they are looking for ways
to have you redeem more miles and points for less value, and I
don't see that changing.
Q: What airlines are the most generous to their frequent
flyers right now?
A: It really depends on where you live and how much you fly,
but I still think American Airlines has the best top-tier elite
status. American is also the most generous, in my opinion, with
international upgrades giving eight system-wide upgrades, versus
six on United.
Q: What should travelers look for when they are deciding
which airline loyalty program to focus on?
A: Travelers should not have blind loyalty. The biggest
thing is don't put all your miles in one basket. You should get
a credit card that allows you to transfer to multiple programs.
You can be loyal to one airline, but don't over-expose
yourself because that program will probably change or that
airline won't fly where you want, so it's good to have points in
all different programs just like your stock portfolio.
Q: Is it even worth it to try to accumulate points with
credit cards?
A: Always do the math. If you're not getting at least 1-2
cents per mile in value you should really just think about
getting a cash-back card. The Citi Double Cash and Fidelity Amex
both give about 2 percent back. Why earn one airline mile that's
worth one cent when you could get 2 cents back in cash, which
you could use toward anything?
Also, don't always think that airline mileage cards -
especially ones where you're only earning one mile per dollar
spent - are the best value. Sometimes cash is king and the
ability to use that cash to purchase whatever you want is a
great option.
Q: What strategy should consumers employ for travel this
summer or fall?
A: I would recommend that people redeem miles in the near
term, don't hang on long-term in the next several years because
these programs are evolving and they are evolving quickly.
If you are spending a lot of money on short flights you
should take a look at Delta and United and the programs that
reward based on money.
If you're an economy traveler, especially international,
you're going to lose big time, so do the math and choose a
program that rewards you the most.
And, frankly, don't be loyal to an airline if they're not
loyal to you. If you're earning less miles and paying more and
not getting the perks, it's time to rethink your strategy.
(Editing by Dan Grebler)