I am in the midst of a rather intense few weeks of work and travel. I’ll be posting new content regularly, but filling in some spots with “Best of” posts from time to time. How does a post get qualified as “Best of?” Pageviews, comments, and intuition. This post originally appeared on March 5, 2014.
I’ve been thinking about this since Delta first announced its transition to a new revenue based program last week. I really can’t fit all the words describing this post inside the space of a reasonable title. With that, let me try a full description – My Last Word on SkyMiles Until We See the New Award Chart and Three Reasons Why I Am Staying For Now Other Than I Live in Atlanta.” There, how’s that?
Let’s start with a few facts. First, SkyMiles is evolving and I don’t think there is a single thing all the noise in the world can do about it. Like it or not, Delta Air Lines has a different vision for their loyalty program. Many do not agree with that vision. Who is correct remains to be determined, but I do not think that any of the airline programs are immune from change in the long term. I’ve said this before, but the real contribution to the bottom line of an individual customer is going to figure heavily going forward, and a “mile” is no longer the measure of value it once was. I am under no illusion that I am all that valuable to Delta. That said, I’m a Platinum Medallion who spends more and costs less than other Platinum Medallions, and no doubt some Diamond Medallion members. Tell me I’m just doing things wrong if you want.
Second, whether I think Delta is right to consider spend as the primary (but not the only) factor in value or not (and for the record, I do think they are at least partially right), they haven’t done the best job of rolling out a change in the world of airline loyalty that is so different than things have been for so long. Introducing change so drastic without the complete picture, the award chart, was the wrong decision. I actually asked a Delta spokesperson about this, and the response was that “we’re looking at this feedback now.” Perhaps the yelling has been loud enough. We will see. Finally, Delta did not just make up something this huge overnight or on its own. Rumors and innuendo have been rolling around for years about concerns with ballooning amounts of outstanding miles, and I assure you that this is not just a Delta issue. I have no idea if the industry has been “over rewarding.” I’m pretty sure the balance of miles outstanding has grown beyond an ideal level, but that’s not entirely our fault, is it?
In the end, a lot of the drama surrounding this change will turn out to be nothing more than noise even if it could have been managed better. That’s not to say that I do not think Delta will lose any customers over this. I certainly think they will, and they will not all be “low value.” I just don’t know if the customers they lose will be missed all that much within a restructured Delta, and more importantly, a restructured industry. It is easy to say that this is just the result of too many mergers and a lack of competition. Surely, competition has been reduced in the airline industry, but has it been reduced that much? Right here in Atlanta, I can fly at least four carriers, and sometimes more to just about anywhere I want to go. Is that enough? I think so, even if I could once choose from 10. Given that I really do like my miles and elite status, all things being equal, I don’t look at making a connection as a deal breaker.
I can think of no other industry where so much wealth has been transferred from the pockets of shareholders, the companies they own, and the people they employ into the pockets of consumers than that of the U.S. airline industry in the last 30 years or so, especially since 9/11/01. What is happening now is merely one piece of the end game of a great balancing act, and if the pendulum ultimately swings too far I have a bit of faith that the market will correct things over time.
Now that you are good and exercised, I’ll share three reasons why I will continue to fly Delta. While a loyalty program can no doubt be leveraged to purchase customers, I have to wonder if the underlying service a company provides shouldn’t matter more?
# 1 – A reliable airline matters.
# 2 – I continue to be pleased with the level of care I receive as a SkyMiles Medallion.
# 3 – I’ve never walked off a Delta flight and said “wow, I can’t wait to fly someone else.”
In closing, do not call me a Delta “apologist” even if you want to. They absolutely can do enough to send me away. I’m just waiting for the mileage program end game to play out. In the end, I’ll do what’s best for me. As I’ve always said, that’s what you should do too.