Delta adds a redemption option, but not a very good one


After adding restrictions on the double miles redemption options (unrestricted for most carriers), Delta has added another redemption option for a subset of their members. For starters, you have to have a Delta SkyMiles AmEx Gold or Platinum card to take advantage of the new program, so that excludes a ton of folks.

The bigger problem, however, is that the value is rather terrible.

The scheme is “Pay with Points.” The general idea is that you redeem points for dollars off a fare, rather than a set number of points for a ticket. There is a minimum number of points per flight, depending on the fare, but the scheme is relatively simple. The best one can hope to achieve with the redemption value is one cent per point. That’s the bare minimum that most frequent fliers will accept for redemption value, so really it isn’t a very good deal.

On top of that, the tickets purchased using these points are considered reward seats, not paid seats, so you don’t earn miles for flying on those tickets. While that isn’t unusual for regular reward tickets, since there is a decent chance that these flights will be paid for using cash, so getting no credit for the flights isn’t completely unusual. There are other carriers that offer similar cash + points redemptions, most notably bmi’s Diamond Club program, and those flights don’t earn points when you travel on them. Then again, the points amount on those redemptions isn’t tied to dollar value of the ticket, so it is a pretty different scenario.

There’s been a lot of discussion of the new program over the past couple days. Many are concerned with the value. At least one is actually happy (or at least not upset) to see the development. He is excited that the “increased flexibility, transparency, and convenience provided by Pay with Miles will be welcomed by many SkyMiles members and sets a new industry standard for award availability.” Sure it is transparent, but if we have to trade transparency for actual value of the points, I’m not so sure it is actually good for the consumers, regardless of what they might think.

Ultimately, the real question this raises is whether the industry is shifting towards a setup where the “value” of miles is a fixed level tied to the cost of earning them, rather than a variable rate that benefits those who are flexible and/or willing to work within the system to extract higher values from them (I’ve got a couple trips booked so far this year with 2-3 cents/mile value, way better than the 1 cent/mile value that this program maxes out at). There are other carriers working in this direction (Air New Zealand does for domestic flights), but so far no major carriers in the US or Europe, other than Delta. I hope the followers are few, because this would make the game a lot less fun.

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Seth Miller

I'm Seth, also known as the Wandering Aramean. I was bit by the travel bug 30 years ago and there's no sign of a cure. I fly ~200,000 miles annually; these are my stories. You can connect with me on Twitter, Facebook, LinkedIn and .

One Comment

  1. ” the real question this raises is whether the industry is shifting towards a setup where the “value” of miles is a fixed level tied to the cost of earning them, rather than a variable rate that benefits those who are flexible and/or willing to work within the system to extract higher values from them ”

    I remember asking Randy Petersen this exact question in May 2006 (!) and he told me not to worry. Five years later I’m not so sure.

    I don’t think award charts are going away any time soon but there does seem to be a move in the direction you’re talking about, which frightens me.

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