7 Responses

  1. Nic
    Nic at |

    Of course they are not going to tell you the truth. I don’t buy it, those redemptions are a really bad deal, but people do it. I have seen people people redeem MR at such bad values. I can’t imagine miles will be any different.

  2. Bob
    Bob at |

    I agree with Nic. That said, when the program changes to all rev $$$ for earning miles next year on flights, most folks will be earning far less and those miles will (in my opinion at least) become much more valuable.

    Also given the purchase price for Award accelerator, it’s right now 115.00 for 5000 miles, a side car (on your screen shot) retails for 14.00 / 2000 miles.

    I have to imagine people seeing over this charade from UA,

  3. David
    David at |

    I’m confused (and was on your podcast, too). If United’s studies show that their business travelers want to redeem points for something other than travel, how does allowing them to redeem for food in an AIRPORT help further that goal? Perhaps the conclusion is that these business travelers are using points while traveling for work, but if these people are traveling for work, then presumably their expenses are paid.

  4. JB
    JB at |

    I have so internalized the game of maximizing loyalty programs that I forget some people consider miles to be found money. I immediately convert miles and points to a cash equivalency. This weekend I tried to convince the clerk at my local wine shop to give me the 20% off black friday/saturday case discount and let me pay with 24 $10 transactions. He told me the system wouldn’t allow that many splits so I had to settle merely 8% back (buy 12 get one free). I got upset that he was ripping me off, and then I remembered it was all free money (Amex).

  5. progapanda
    progapanda at |

    The redemption values on the menu don’t even make sense – a 17$ chocolate stout for 1,000 miles; or a 13$ escargot appetizer for 4,500 miles? What!

    Just how stupid does United think its “overentitled” customers are?

  6. Nick
    Nick at |

    They basically profit when you redeem for these low value options. Ideally they want the mileage business to be profitable in its own right. That doesn’t happen when you redeem for partner awards earning via cheap tickets. I suspect revenue based earning only gets them part of the way there and they still need to make partner redemptions more expensive.

  7. Michael D
    Michael D at |

    United wants to sell miles. People who do not redeem miles make more money for United. But they aren’t a rapidly growing segment. When you have a growing segment you can spend money today that you project you will have in five years because in ten years you will have so much more.

    I have always wondered what United’s definition of the elusive “Business” flyer is and how they determined who fits their definition given the information they collect. I can not imagine someone who pays for their Business travel or who is a Business flyer who also does non-Business flying naive enough to spend their miles on are anything else than award trips. I can see economic arguments for not doing so. I can’t see the economic argument for using a credit card with miles as an award versus cash or any other method of accumulating miles aside from ancillary flying.

    United is making a significant amount of cash from selling miles. Much more, I imagine, than from selling box or sandwiches on board. I they don’t keep the award miles river flowing they are very foolish to think they can keep selling miles to Chase and individuals at the rate they do today to the few who are happy to redeem miles on items other than war flights.