For 2020, GSTP will launch a new Wednesday column titled “calling BS”, where we take a look at something which just doesn’t quite seem right…
In my heart, I’ve always believed that frequent flyers are gluttons for punishment. If that’s to be true, these days, we’re really getting what we ultimately crave. Changes are everywhere, benefits are being slashed and now, United has gone a step further than any other airline program, fully equating travel benefits earned with spending given – and nothing else.
As of today, the ridiculous new system is live. I’m calling BS on these changes, because this no longer qualifies as a loyalty program. It has nothing to do with loyalty. If you’re unaware of the changes, catch up here for more. In short: it doesn’t matter if you fly around the world 100 times, it just matters what you spend.
Earning “premier’ elite status with United MileagePlus is now based purely on money, and nothing to do with how often you fly, or how far you go.
Unless, of course, you’re spending $24k a year on tickets.
Now before you go to the “well, people who pay more should get more argument”, save your breath. I agree. People who do pay more – even if it’s really just a corporate contract paying more – should get more, and really – they already do. Every airline has special services teams and rules that can be bent for corporate contract flyers and high value customers. That environment has existed for decades.
Someone spending $24,000 on one flight should be treated really well, and I don’t see why they can’t have major benefits instantly with an airline when they drop that kind of coin on January 1st, rather than waiting an entire year grinding it out. If you don’t have to grind, why would you? It only makes sense to offer someone spending a lot all the best perks with immediate effect. You want more spend. Duh. But uprooting the program for everyone else makes no sense.
In fact, there was a time not long ago (which probably still exists) where if you were willing to pre-pay roughly $50k of flying with an airline like American, they’d give you invite only ConciergeKey status from day one.
Of course, there were terms, stipulations and other things involved, but there has always been ways for big spenders to get rewarded in ways loyal flyers do not, and yet both continue to live harmoniously in other programs.
Money talks, no argument here – but how dare you marginalise those select loyal few who actually believe in your airline or your program most. Most high value customers don’t care who they fly with. Plus, it’s either not their money, or you just happened to be lucky.
In recent years, that hasn’t been an easy pill to swallow, either. Sure, you could say that they weeded out the bloated ranks of people receiving perks, but there were plenty of other creative ways to do that anyway, without making people feel abandoned. And since United, like other US based airline loyalty programs excluded its own top tier fliers from lounges domestically anyway, it’s not like they really did much in terms of physically clearing space.
Someone daring enough to fly via Chicago in winter, because their beloved United flies there is a promoter of a brand. They have bought into the ecosystem, probably tell their friends and at that point, United is owning the “wallet share” from that customer. The reason most people stick with a loyalty program isn’t because of how great it is, but rather how hard they feel it might be to go to a new program without the benefits they enjoy so much.
In other words, chances are that other airlines aren’t getting much, if anything from a loyal United flyer. That’s worth a lot, even if the person isn’t spending $24k a year. Money out of a competitors pocket is pretty valuable…
But when you say that the emotional connection is gone, and it’s just a transaction, as United has now done – it creates something United probably did not have the foresight to realise. If someone, or an entity they work for does have $24k, what might happen when they do a bit of research? Is United going to win the award for best economy seat? No. Premium economy? No. Business Class? Ha, no. Lounges, yeah – it’s a no, again.
So why would someone hand United $24k at that point? If it’s just about money, get as much for your money as you can. That definitely ain’t United…
As far as the future of loyalty programs goes, I actually think Accor, the hotel chain has it fairly right. You can qualify purely on money, or you can qualify the old fashioned way, with nights. Someone can stay 1 night in the Plaza Penthouse and earn top tier status on day one, but so can the road warrior staying in $60 a night hotels for 60+ nights. Everyone wins and money talks, but so does loyalty and owning the wallet share.
The exits are clearly marked, folks…
I actually love these changes. Separates the society into rich and the people that want to serve the rich ( or how think they will one day become rich.) I certainly hope they put cages in the economy class. You can never trust the poor while in flight.
Any republican that has a problem with this should be punched in the face.
I’m calling BS on your column: “Earning “premier’ elite status with United MileagePlus is now based purely on money, and nothing to do with how often you fly, or how far you go.” That’s false. You can spend $24K to attain 1K, or if you fly at least 54 segments with United or its partners, then the spend requirement is lowered by a quarter, to $18K. And partner flights that used to not count at all for spend now do (using a formula that can often be more favorable than United’s own flights.)
Now you’re perfectly entitled to your opinions, positive or negative, about any of these changes. But instead of actually looking at those, you just rant. That’s what I call BS!
So if I fly 54 times, I can get away with spending $18k, instead of $24k – you’ve really sold me.
Simple fact: United now has the highest revenue requirement of any US airline and does not count miles flown in any capacity.
Simple fact: Domestic frequent travellers don’t fly on partners, therefore it’s irrelevant for United’s core domestic audience. I say that, because anyone who does fly on partners would do better with virtually any other loyalty program in the world, particularly if they live outside of the USA.
You don’t need to fly 54 trips. Those are segments. If you connect once, that’s 4 segments out of one ticket. A lot of people will easily hit 54 flights.
I don’t know if your “simple facts” are actually facts, but since your blog presumably caters to more than just the people with the exact travel pattern as you, perhaps you could present the full picture of the changes, as I did in my earlier post, rather than only choosing the ones that suit you.
How many people do you think fly 54 segments in a year?
I travel quite a bit, more than I (or my family) would like.
Below is my *A activity for the last 5 years:
2019: 156k PQM on 46 segments (18 non-*A segments)
2018: 133k PQM on 41 segments (5 non-*A segments)
2017: 113k PQM on 36 segments (9 non-*A segments)
2016: 103k PQM on 32 segments (2 non-*A segments)
2015: 79k PQM on 22 segments (7 non-*A segments)
Adding in additional segment runs to reduce the revenue requirement might make sense if it was just 2 (maybe 4)… but beyond that is just insane. And arguing that I should fly *A for those non-*A segments listed above is folly because *A doesn’t fly everywhere, and I don’t have much of a choice when I travel for business. What I do have a choice on is personal trips, which at least until 2019, I have focused almost entirely on *A.
That said: I do agree with you that flying with partner airlines is a better approach for hitting that 24k goal (or 18k/54 segments), but the reality is that most Americans won’t have that opportunity, it’s primarily us expats that can leverage that… but for us expats, I’m guessing most of us won’t be able to easily add in enough *A segments without doing segment runs to inflate the numbers (I know I won’t).
I like these changes, too!
By the way, Gil, how is that Brexit working out for you!!!
Ha Ha!
I can understand your argument but my guess is that most us airlines realized that rewarding low spenders is not a good idea because they have the data. Apparently not enough people are leaving ua because of these changes or those people who left were not contributing to their profit margin. Otherwise they wouldn’t make these changes. I hope they are wrong but I feel like they are smart enough to know this from their data.
Ken, I agree that there definitely is data that suggests that outsized benefits have been had by those who are perhaps not deserving of such levels. Totally with you there.
My disagreement would be that it’s easy to stratify the most sensitive benefits to higher tiers, which somewhat already happened when revenue requirements were added. If we see Delta follow, we’ll know the data wasn’t skewed, but I personally don’t think we will any time soon. I think this is a one man band beating to the off beat sound of its own drum.
Honestly, I literally couldn’t care less about Mileage Plus or United anymore, and Newark (EWR) is my home airport and therefore we’re imprisoned by United to some extent. I’m a short distance away from lifetime Gold on UA, and lifetime Plat on AA.
United is the most recent and perverse example of these so called “Loyalty” programs decaying/morphing into something new, that benefits a tiny few, but broadly offers no value for the rest of us who no longer fly 2-6 times a week, which I did for 25 years.
Candidly, ALL the “Loyalty” programs have lost their reason for existing in most cases, for all but the corporate traveler traveling under a corporate purchasing program. There are no longer real “Benefits/Perks” like in the first few decades of these programs, when “frequent flier” actually meant something.
I have been a low spending 1K on UA for 10 years and now have lifetime Gold. UA used to offer outsize rewards for people like me. First they stripped away mileage earning, then mileage spending, then they squashed even the E+ seats together so that they are miserable on 10+ hour flights. I resolved to fly less but in more comfort and stay loyal: 6 Business Class returns instead of 10 Economy Class, with some of the Biz returns bought outright, some upgraded.
But these changes make that impossible. I can earn serious rewards in any other program with those purchases so I see no need to subject myself to UA again except to use this year’s upgrades. So it’s OneWorld and UA partners only in my future and I’m relieved not to have to defend UA, and my decision to fly it, ever again.
God save those of us who reside in a captive United hub market.
Been over United for two decades, after a decade as a Premier Executive, but they are literally the only non-stop option for a lot of routes that I need to fly.
Sigh…
Spending 24K on SWA gets me a ton more value on SWA and that’s where my 24K is going in 2020. Buh-bye United.
You will probably be able to count on one hand people who will spend that kind of money… their own money that is.
OPM rules, and United has smartly created a program where OPM will use tricks to book their flights to drive up their PQP (like wait to book their work flights till price goes up, etc).
Award $ to the entity paying, not the flyer, and you d eliminate 99% of “elites “
While I understand some of the business reasons United are doing this, I agree with opinions expressed in the article, and I feel like this decision will have some unforeseen (or unintended) consequences for United Airlines.
Usually, when a company changes something (increasing cost, etc) they position it in a way that at least takes the sting out of the change, by giving something of value to the consumer. “New and improved product X! That’s why it costs 10% more!” etc.
That did not happen, which means that the premise of the opinion is accurate: United has denigrated the loyalty relationship to be 100% fiscally based. Some may argue that the conversion of RPU and GPU to PP fit this role – however that change and Premier Qualification were rolled out at two different times and independently of each other. United marketing could probably take this as a learning exercise…
Regardless, for those who have commented that say they like these changes… have you actually gone back and analyzed your past travel and compare where your previous status would land under the new program?
I just did this exercise for the last 5 years, and it’s not pretty (at least personally).
And to the person who suggested to fly 54 segments… how reasonable do you think that really is? I flew more than 156k miles in 2019 on a total of 46 segments on *A steel. You’re really suggesting I artificially tack on an additional 8 segments? Spend more time away from my family than I already do? Please.
In 4 of the previous 5 years, I’ve qualified for 1k status (and platinum for the other), averaging 112k PQM per year with a waived PQD because I’m an American Expat living in India for business.
Under the new qualification requirements, I would only qualify for 1k once (in 2019, when most of my travel was on *A partner airlines – the final calculation had me at 25180.53 PQP’s…)
Net result:
2019: 1k -> 1k
2018: 1k -> platinum (despite having 133k PQM this year…)
2017: 1k -> gold (113k PQM)
2016: 1k -> gold (103k PQM)
2015: platinum -> silver (79k PQM)
When reviewing and analyzing the benefit of the UA tiers from a 2019 program perspective, the value drops off considerably after Gold and doesn’t pick back up (at least for me personally) until 1k. RPU’s are useless to me (I don’t live in the US). GPU’s are valuable to me.
Given the above analysis, and reviewing and analyzing the benefit of UA tiers from a 2020 program perspective, with the change to qualification requirements, plus points, addition of a new premium economy plus cabin, etc… the value of staying loyal to UA or even *A has been significantly diminished from my perspective.
* The biggest *AG perk is lounge access… which I can buy anyway. The United clubs are among the worst in the industry, but *A lounges outside North America are generally nice.
* Very few airports that I frequent have separate security lanes for *AG
* Most *A partners I fly with don’t honor the baggage benefits of being 1k or even *AG… so unless I’m flying United steel door to door (which rarely happens because I live in India), that benefit is worthless to me
* The dedicated 1k phone line has only actually helped me once in the 6 years I’ve qualified for 1k (to be fair, I’ve only called them a handful of times when I really needed help, but they couldn’t come through for me)
So, that leaves Plus Points as the primary value to me personally. I’ve got 580 to burn, but it’s not likely I’ll be adding many more to that given these changes.
Ironically, these changes will actually liberate how I manage my flights in the future, since I will no longer feel the need to be bound to United or even Star Alliance.
So, again, to the author’s original point… United changing the basis of the loyalty relationship to be fiscally based has actually cost them wallet share, at least with me and my family.
United doesn’t deliver any benefits anyway..so who cares.
1K upgrades are crazy low. I was 10-20%.. First Class food is now last place with crappy snacks being served on 3 hour flights during meal times instead of hot food. I think they know , no one wants to fly them anyway.
Another thing UA (and others) lost are brand ambassadors. I spent years advising staff, colleagues, friends to fly UA and make their lives easier by getting status even if it meant connections or other inconveniences. Now not so much. Last night had a conversation where I advised friends to not worry about loyalty or status and just take their business class spend to different airlines.
I’m sure it makes sense for the airlines based on business math, but since my decline in experience I no longer steer business and my positive vibes and stories no longer influence others.
Given the changes I’ll go from 1K to platinum if I fly/ spend as much in 2020 as in 2019. 2019 invoked some effort / extra spend. As a million miler, my choice is I) make an extra effort to hit platinum or ii) no effort and drop to Gold. My guess is I’ll lean towards ii (even if I live in a captive hub) due to choosing to minimize spend vs extra spend to hit platinum.
I agree with you completely. As a United loyalist who regularly gets 125k PQM on United but struggles with PQD, this change completely eliminates my loyalty to UA after the redemption side was decimated a couple of months ago. I am going to requalify in 2020 based on cheap PE flights on partners but I’m actively considering other airlines/alliances.
Whats the point of status anyway? Is it so you can sleep better at night? When I was 1K I saw them sell upgrades to the cheapest bidder. Why would I be loyal and spend so much with an airline when they would then rather get $79 then upgrade me for my loyalty.
Here is the truth… Cash is King… It always has been… period. In the past, the rules were written in a away where they could have been taken advantage of… IE. buying a super cheap ticket to get lots of miles.
Now, yes, the rules have been changed where you can’t but a cheap ticket and be rewarded for it more than the actual value of the ticket.
If I fly 25 SHORT round trips, each way consisting of 1 connection and 2 45 minute flights(4 segments per round trip, that cost me $400 each… That’s 100 segments and $10,000. But only 500 miles x 100 segments = 50,000 miles
So…
Why are you better for spending $3,000/$3500 on a 3 round trip flights to Australia or Singapore and getting 60,000 miles?
Who is more loyal?
I’m not going to complain about upgrades… I get upgraded all the time… and if I want 1st/business on a particular flight… I buy it upfront or use miles to upgrade… Cash is King, and nothing anything is free.
Untied leveled the playing ground… there, I said it…
Nobody has all the data. There are things you can’t easily measure. And decisions based on data are made by fallible humans, usually in a meeting, after pointless debating has burned off the sugar needed to make a good decision.
What does an airline want its loyalty program to do? I’m not sure you can get a room full of execs to agree on that.
But the best programs are those that drive revenue by giving customers who frequently make a purchase decision a reason not to look at the competition, and, when they do, a reason to think that an incrementally higher fare is “worth it”. The data may be getting better, but these things are hard to measure or predict.
Going for the biggest spenders is great; I’d want them too. I would not want, however, to encourage the people who will cheerfully find the most expensive solution for their corporate travel so that they personally benefit: you’ve already got them on board with miles. Now, you’re inviting the sociopathic people who will be sure to find ways to run up your airline’s costs as well. Hard to measure in advance.
So, will this improvement thin the UA herd? Sure. Will it encourage behavior profitable to the airline?
Here’s another data point to consider: what kinds of small talk transpire between strangers in the back? How much of that is about the airline? What are they saying?
I strongly disagree with your premise that this does away with “loyalty”. I’ve been flying since the mid 80s (around 8 million FF miles since then) so feel I can speak on this issue. There has NEVER been concern about loyalty as you seem to define it. From an airline perspective everything they have ever done with FF programs is to generate revenue and nothing else. They really don’t care how many flights you take or miles you travel, it is all about revenue. Let’s look at an extreme example – if this program attracted people that paid full price for business or first class seats, along with a mix of people in coach just trying to get from point A to point B, but UA lost all the “frequent flyers” that grind out miles or segments to get to a top tier level such that they generated the same revenue (through the higher priced tickets) but were able to cut flights, and associated cost, since all the grinders left. This would allow them to have the same revenue with less expense which is the goal of any business.
You and others who are either grinders or write blogs for grinders hate this but it is all about business. I love the new model (and I’m not a United flyer) and hope it spreads. It eliminates all the BS about FF programs and reduces it to simply revenue generation which is all that really matters in the end.
A poor argument because that loyalty still does in fact come down to cash. Even a person who was grinding has more value than a person who isn’t and has no brand loyalty to you anymore because the grind is no longer a factor.
The reason being is that these grinding plebeians were the folks who were going to pay marginally more on all their flights with UA to add to their grind as opposed to not flying the airline at all. Now, with insurmountable qualifications for status that wipe out the usefulness of the grind and only adds up to precisely how many dollars are spent, you lose a ton of those customers who would choose to spend slightly more on their flights to stay with United. And you don’t just lose the marginal amount more that they spent with United as opposed to going to a competitor, you lose the entire amount. It’s not as if United was the cheapest airline to begin with, so it’d be outrageous to assume they’d win on price alone. The perks, partnerships, and customer service also continue to get worse, so UA wasn’t winning any awards there and isn’t something they can compete with other airlines on toe to toe. So when you take away brand loyalty and are only looking at prices… Bye bye United.
Not sure if it needs to be spelled out any further than that but that decreased loyalty adds up significantly. Even if you keep your thousand customers who can drop $25000 a year (who, by the way, would have done so with or without these changes so it’s not like UA needed to capture that market), if UA loses or now has to compete on price alone, the one million travelers who were grinding on affordable $250 round trip tickets, well…I’ll let you do the math.
@ AC
Yes… 100%
“It eliminates all the BS about FF programs and reduces it to simply revenue generation which is all that really matters in the end.” – as it should…
It’s a terrible new system, but who is surprised? UA has long been telling customers in every other way imaginable that they do not give a damn about their loyalty. Now, the final nail in the coffin. What makes it worse is that other than on sites like this one and other points blogs, United has done a poor job of even informing tier members of these planned changes. And so where does that leave status members who were on the cusp of a higher tier who could have locked in a higher status prior to this new system where they have to spend an extra $2k at least, to reach the status that would have previously only taken an extra $200.
Methinks that lack of clear communication was purposeful, which makes this move that much more skeevy.
Dear Gil,
You are correct. We remain loyal because of concerns of moving to a different program. But they lost much of my business when they cut showers out of the lounges, which most staralliance lounges have. Now, you mention other programs. Which ones are good alternatives to United within the staralliance group? Or maybe even put of it?
Hey Denis,
Asiana is quite lucrative, with 2 years of status availability and access to lounges while flying domestically. They also have very valuable miles. ANA is another one which is tough to earn with, but the miles are extremely valuable, and same applies for domestic lounge access.
Hello Gilbert,
I want to congratulate you on articulating what many long time 1Ks think about these changes.
United and Delta are high right now because of an influx of American Airlines frequent flyers running away from that airline because they have had horrible reliability issues in the last few years. For the last 5 years United has gutted their frequent flyer program and made many changes we didn’t like. This will be my last year as 1K and I’ve prepared with every change they have made. Now have status with two other international airlines and where I travel really like the alternatives. We were all not put on this earth to pay United $24,000 a year. For what? To enjoy a snack basket in (usually fly paid) domestic first class or to enjoy a completely melted Sundae in Polaris. They consistently promise more than they deliver and then complain about frequent flyers who follow the program rules “gaming the system”. The Hubris at United is appalling. From almost 100% of my spend 5 years ago they will get less than 1% of my spend in 2020 and going forward. How that is good business is beyond me.
Dude, talk about jinxing it. Look at what Accor just did with their new Diamond tier…
Thanks for starting this conversation, Gilbert. I thought it was just me. After the Continental merger something broke. Travelling over 250K miles annually, I was always #1 or #2 on the upgrade list. Now I’m somewhere between 10 and 25. WTF? I get it, though. If I want to gouge my client or company to pay $11,000 for a $1000 ticket, I win, they lose. And I fly once each month, I get my top upgrade spot.
But if I’m a road warrior, on 6 flights each week on domestic-level equipment (not luxury level 1st-class international cabin pampering), then I fall back so far in the list I’ll never make an upgrade; even if 1st class empty!
I called 1K desk several times. Their response was revealing. “yeah, we’re hearing a lot of those complaints lately”
Well, there’s another option (although not as convenient but worth it). … Alaska.
The past 4 months I’ve been upgraded 95% of the time. Just like United years ago. For the first time in 20 years I’m giving up 1K
Great article!! So true! I achieved 1k status three times in the last five years. By new rules, never more! Time to walk out of the door.