For the first time in decades, the loyalty of Delta Air Lines’ elite frequent fliers isn’t being measured by miles or flying alone.
Instead, cold, hard cash has been added to the equation.
It will now take at least $2,500 in spending annually to reach Delta’s Medallion status — on top of the typical requirement of flying 25,000 miles.
The shift reflects airlines’ increasing focus on the most lucrative, high-spending corporate travelers. By making elite status even more exclusive, Atlanta-based Delta is reserving its best perks, best service, best seats and best food for them.
Effective Jan. 1 this year, Delta is requiring $2,500 of spending to reach silver Medallion status, $5,000 for gold, $7,500 for platinum and $12,500 for diamond — in addition to existing requirements to fly 25,000, 50,000, 75,000 and 125,000 miles, respectively, to reach those levels.
Delta is not alone in adding a spending requirement. United Airlines launched a similar standard, and Southwest Airlines’ frequent-flier program also has a spending component.
“Elite status, from the airlines’ perspective, has always been principally about rewarding customers for their revenue contribution to the company,” said Tim Winship, publisher of FrequentFlier.com. In the past, it was easier to use miles as a proxy. Now that technology has made it easier to track spending, he said, “this is … the realization of the original intent of elite status.”
Frequent-flier program watchers say the shift could eventually spread beyond elite status to the general frequent-flier program — with the possibility of points for free flights being based more on dollars spent, instead of miles flown.
For the Delta elite, spending this year — measured in “Medallion Qualification Dollars” — counts toward elite status for 2015. The spending requirement is waived for those who spend $25,000 a year on a SkyMiles American Express card.
“For the truly frequent travelers who spend the most on Delta, at platinum and diamond status, they’ll likely be happier about this, because there will be fewer people they have to fight with for upgrades and for getting on the plane first and that kind of thing,” said Chris McGinnis, publisher of The Ticket, an online newsletter for travelers.
But it’s also likely to leave some frequent fliers out in the cold next year. Those most likely to fall out of the elite ranks are air travel hobbyists who depend on cheap, circuitous flights to rack up more miles for elite status — known as mileage runs.
“People who game the system and have been able to create very high status by not spending very much — those are the people that I believe Delta is trying to weed out,” McGinnis said.
That might include people who fly a moderate amount for business, but are willing to invest lots of time and energy into earning miles, said Winship of FrequentFlier.com. “I don’t want to say they’re crazy, but there’s a little bit of an element of that in it,” Winship said.
Also at risk of falling out of the elite ranks are some small-business owners who look for cheaper fares because they pay for travel out of their own pockets. They could find it more difficult to reach the same elite status they once got, McGinnis said.
David Holyoke, president of travel management firm Travel Leaders Corporate, expects it could also affect frequent leisure travelers.
Corporate travelers, on the other hand, tend to buy higher-priced, last-minute tickets. “There’s a tendency to think, ‘Wow, maybe I need to purchase higher-priced tickets to qualify,’ because nobody wants to lose their elite status,” said Tim Kennedy, franchise owner of five Travel Leaders locations. But elite-level corporate travelers will likely easily meet the spending requirement, he said.
Source: MCT Information Services