Horrible advice on award valuation from the Wall Street Journal


I’m generally a big fan of Scott McCartney’s The Middle Seat column in the Wall Street Journal so I was excited to read his post today about "Getting the Most Out of Your Frequent Flier Miles." I was hoping for some great insight into award pricing algorithms or inventory patterns. Instead I got a primer on how to not get any value from points. Such a disappointment.

There are a number of take-aways from the post but the main conclusion is this:

With domestic coach tickets, you generally get not much more than one penny per mile in value from airlines – that’s a $250 ticket for 25,000 miles. If the ticket now costs $400, you likely will have to pay 40,000 or 50,000 miles.

Not only is it simply wrong, but it is also very misleading in terms of getting the most from your points. Other than the programs of JetBlue, Virgin America and Southwest, (and also one option from Delta or American Airlines) the redemption rates are not tied directly to the selling price of the ticket. If there are no discounted seats left it is less likely that award flights will be available at the lower rates, but that’s tied to the inventory, not to the fare price. As the prices go up at the low end it actually means that the "value" realized for redeeming points is arguably higher since the cash option will be more expensive.

McCartney also picks a few random routes and tries to read into overall domestic award inventory based on his searches for economy class seats on one carrier for each route. His approach fails miserable in many ways.

First off, it appears that the searches he performed were based only on using the website of the carrier where the miles are sitting and then by just putting in the end points. This resulted in finding only a handful of seats for Boston-Ft. Lauderdale on Delta, Orlando-Seattle on American or Washington, DC – Austin on US Airways. For the Delta results this approach overlooks the issues that their website suffers from for award bookings; it is very limited, especially when searching for connections. For American I see very different results than McCartney did, with plenty of award seats open at the "Saver" level.

Both of those are questionable, but the US Airways one is the most egregious bad advice of the three:

And if you’re in Washington, D.C., and have US Airways miles you’d like to use to go to Austin, Texas, get ready to pay a heavy price—besides the $25 processing fee that US Airways charges for a “free’’ ticket. For the 10 months in the rest of this year, there are only five days when US Airways offered a flight to Austin at its basic mileage price.

In addition to only searching on US Airways’s website, McCartney ignores the fact that Dividend Miles can be redeemed for flights operated by United Airlines. Checking the award calendar there it is clear that finding an award seat from DCA-AUS is actually a rather trivial task on most days for the rest of the year. Yes, you’ll have to call in to book it, but that’s a small penalty for saving 25,000 points.

Sorry, Scott, but you missed the boat BIG TIME on this one.

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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 .

12 Comments

  1. This seems to be the trend these days. I first got this ignorance from Chris Elliot over at Nat Geo and this new Middle Seat article has taken it to the next level.

    I guess we know why so many people are scared away from frequent flyer miles. Hopefully with great rebuttles like yours we can demonstrate the real value of the

  2. I now use my miles almost entirely for international business class upgrades or for international first class and business class seats. But I do have an occasional need for an odd trip or a one way leg when it makes sense to use them for domestic flights, if not for me, for a family member. This article is very misleading. I recently needed a specific one way fare on a certain day and time and it would have cost $500 to buy and I was able to book a reward on United for 10,000 miles + $2.50. I always hear complaints about how difficult miles are to use, but I never have any trouble finding what I need if I am persistent and creative enough.

  3. Isn’t the fact that he scares the regular folks off frequent flyer miles good for the rest of us? More seats to redeem?

  4. You beat me to it. I think one of the worst parts of the article was leading in about how the woman was flexible with dates and separating passengers on different flights. But the most important thing to me is being flexible with the destination. If I can settle for X instead of Y, I can still have a great vacation and use half as many miles, which means I have enough to fly to Y later when the saver seats do open up.

  5. True, Julian, but it also makes it harder to convince friends and family about the value of collecting miles. Totally agree with this article: I booked 3 tix at 25k miles on United that would have cost me $470 each for this summer.

  6. Seth—

    Thanks for your comments on my coverage. I respect your opinion and appreciate the thoughtful criticism. But I also wanted to clarify a few things.

    First, there is a correlation between fare buckets and frequent-flier award buckets, thus fare and availability. Airlines have two ways to raise prices: increase the fare in particular buckets or close off a lower-priced fare level and bump inventory into a higher-priced level. As I’m sure you know, each flight has some 20 different fare buckets. So with oil prices high and inventory tight, the lowest priced buckets get cut off quicker. And as a result, the lowest-priced frequent flier award availability may get closed off as well.

    I also wanted to make clear that I was not suggesting a good strategy to redeem was for low-priced domestic tickets. Instead, the next paragraph after the one you quote says: “You can get better value using your miles for high-dollar tickets like international business-class and first-class upgrades, or by using them for last-minute trips, such as a family emergency, a funeral or just surprising someone unexpectedly. Business-class fares run so high that using miles instead gets you 6-7 cents or more for each mile. And I’ve long advocated, and employed, the last-minute strategy. Better to avoid those unexpected high-dollar tickets if you can.’’

    I studied nine routes looking at availability for every day of the rest of the year. (We ran six routes in the paper showing the percentage of days when standard-level awards were available, and I thought some of the numbers were quite enlightening.) That’s a more interesting look than something anecdotal – such as elite-level members on United saying they didn’t have any trouble finding inventory for a few trips. (Elite level fliers get better award inventory, as you know.) I think it’s quite valid to look at inventory airlines offer on their websites—that’s the portal most people start with.

    You’re correct, obviously, that a better option for US Airways miles on the Washington-Austin route I looked at is United, but United’s inventory was included. It was there. I hope you clicked through the blog post to look at the full story that ran in the paper. I do think it’s valid to look at US Airways offerings and not simply let the airline move its award responsibilities to partners.

    Bottom line, this was a macro look at the market involving four network carriers. The frequent flier world thrives on micro exceptions – yes, you can find what you want many times. Yes, you can call and get better inventory (but why should you have to do that?). I think it’s important to look sometimes at the bigger picture, and I think it’s important to hold airlines accountable for their award availability. It’s important to move past the anecdotal. There are lots of people who are happy with airline availability; there are many, many more I hear from regularly who are routinely disappointed.

    -Scott

    1. I appreciate the reply, Scott, though I still disagree with you on a few points.

      There are (at least) two reasons fares get more expensive and I believe we agree on this. One is that more of the lower fares are sold (i.e. lower fare buckets have no inventory). In those cases it is reasonable to expect that fewer “low” award seats will be available. The other reason it happens is because the airlines are raising their base fares at the low end. When that happens it does not necessarily mean that low awards are disappearing. And I believe that’s what we’re seeing right now. It is not that the low fare buckets are full, it is that the base fares are rising. I guess we are disagreeing on where the fare rises are coming from, though I believe I’m right that it is the lowest fares are higher now, not that they don’t have any lower inventory out there.

      As for ignoring partners and only looking at the website, I understand that’s what most people do. But I thought the point of your story was to help people “do it” better, not to reinforce their bad habits. I guess in the end that is what disappointed me so. You have a huge reach and the opportunity to help so many people to better find the seats that they are looking for. And I think you balked there. All these folks you hear from who are routinely disappointed would have benefited MUCH more from you suggesting that they learn about the partners of their program than your published suggestion, which was to get used to higher priced award flights.

  7. I’m interested in your statement about using US Airway miles to book United flights. I attempted this recently, about 2 weeks in advance (it was a last minute trip). However when I called US Airways, they told me there were no reward seats, even though I had checked the United site, and there were 25k mile routes available. These were not the “super saver” miles, just regular economy award for a domestic flight.

    A call to United to ask about their policy/availability for reward seats booked through partner miles just got me some lady who couldn’t speak english and kept telling me that United wasn’t the same as US Airways (no way…) until I hung up in frustration.

    So my question is, how do you all tie in the United award site search to US Airway booking? Are only the “super saver” award seats available for booking via US Airways?

    Thanks, I am still learning.

    1. The partner awards are only good for the saver level, not the rule-buster awards. If you’re seeing 25K one-way domestic coach awards those are only possible with the miles from that carrier. If you’re looking to redeem US miles and searching on United or Aeroplan (the two easiest and most comprehensive sites, along with ANA, which is slightly less easy) then you need to be looking only for saver level awards.

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