Tuesday, July 14th, 2015, 2:20 pm
The beauty of miles has long been the lack of correlation between mileage cost and cash cost. That has meant that a last minute coach ticket that would cost $2,000 cash can cost just 9,000 miles. A $15,000 first class suite can cost just 57,000 miles. They’re practical and aspirational to collect and use. And that’s been a boon to airlines, banks, and consumers all at the same time.
Delta’s miles (aka Skypesos) have long been among the least valuable in the industry. Then Delta hid their award charts earlier this year.
And now this,
“We know your miles are important, so we want to provide the most notice possible regarding Award price changes. For travel on or after June 1, 2016, the number of miles needed will change based on destination, demand and other considerations. But most Award prices will remain unchanged. To see the best availability and deals, search at least 21 days prior to departure and use our Award Calendar by selecting “flexible days” when searching for a flight.
Miles needed to upgrade will increase, and to provide greater access to these upgrades, we’ve expanded the eligible types of fares.”
I’m not even sure what they mean that “But most Award prices will remain unchanged.” They don’t even have a published award chart today and their award award chart already consists of 5 different levels!
To Delta’s credit, they have introduced awards starting at just 7.5K miles when booked 21 days in advance.
But the ballgame is changing. Delta clearly wants to put an end to outsized mileage redemption values, especially those within 21 days. Dynamic pricing will allow them to charge less for flights that cost less and more for flights that cost more. It’s a simple concept, but it eats away at the very value proposition of miles and can lead consumers to turn in their mileage cards for cashback cards.
Will Delta continue to allow partner redemptions within 21 days to be had at saver levels? It’s hard to say at this point.
We can hope this is just a one-off. But United loves copying Delta devaluations. We saw that when United copied Delta’s dreadful revenue based mileage earning scheme.
It’s hard to see United not copying Delta’s lead here. The only question is how far they’ll go.
My hope is that United is smart enough not to kill the golden goose and that they continue to have published saver award charts and that they continue to allow redemptions within 21 days.
If United introduces dynamic award levels for standard awards that won’t be the end of the world. But it will be a very sad day if they copy Delta here and delete their award charts for good in favor of dynamic pricing.