Have you ever heard the old adage, “Don’t throw the baby out with the bathwater?” That’s what Alaska Airlines just did in its latest Mileage Plan devaluation.
Alaska Airlines now blocks partner redemptions on Cathay Pacific and JAL within 72 hours of travel. Citing rampant fraud, Alaska reasons it had no other choice…just like it claims it had no choice before its massive devaluation of Emirates awards in 2016.
Award Expert clients often ask me about buying miles on the grey market. If you think this is a small issue, think again. It’s a multi-million dollar industry around the world. And while there is potential value in purchasing miles, it is not something I encourage…especially because loyalty programs have shown a penchant for fiercely cracking down on those who engage in these practices.
But talk about a bizarre overreaction. That makes me think something else is at play here…partner redemption costs.
Cathay Pacific and JAL open up their best award seats at the last-minute. Both are dependable at releasing space in first and business class just days, sometimes hours before departure.
With the elimination of booking within 72-hours, Alaska miles are suddenly worth a lot less…even if the award chart remains unchanged.
If fraud was the issue, Alaska could have easily imposed a less draconian solution:
- Redemptions only for the member within 72 hours of travel
- Redemption only for the member or those with the same surname within 72 hours of travel
- Telephone-only redemption within 72 hours of travel.
There are other solutions: two-factor authentication or other security protocols that Alaska could invest in…if it wanted to.
Instead, I believe Alaska wanted a DPRK solution: oh you’ll be safe from fraud, but lose all your freedom in the process. I also believe that Alaska Airlines wanted to save money: less premium cabin partner redemptions mean less money out of their pockets.
I’m turning very cynical toward Alaska and its MileagePlan program. While there are still some gems on the award chart, the program has shown a willingness to blindside members with harsh, no-notice devaluation. That is not how any loyalty program should operate.
With CX it was already telephone-only anyway. Very disappointing.
Here’s another Alaska / Bank of America issue that I experienced. During my travels in November I applied for an Alaska Air credit card and was approved. In the month of December my father became gravely ill so I had to cancel much of my travel plans and remain on the West Coast until the beginning of the New Year (I live on the East Coast). During my stay in December Bank of America generated a statement for the annual fee of $75 and mailed it to my home address. When I arrived home (my father passed away on Dec 21), I noticed the statement and paid the amount in full on January 5th, but the payment was due on January 4th and didn’t clear until January 6th. This led to a $1.50 late payment fee which generated another statement which I didn’t see until returning back home in February. At the beginning of February I make what I thought was my required spend for the account but when I just received my “February” statement I see that the account is “late” once again because of the $1.50 “fee” and not I have to speak with a collection person at B of A to be able to pay the balance in full. Now, however, because I used the card in February I have close to $20 in interest charged! Needless to say I closed the account after paying the balance due in full. So much for Bank of America’s relationship management!
“a DPRK solution”
Alaska’s twitter account announced they were removing this restriction for flights other than those are inter-asia. Good on ’em for turning it around so quickly.
Korean Airlines has a good policy to prevent fraud. You can only use miles for family members.
Most banks will waive the late payment fee on a credit card account one time as a courtesy.
It would appear to me that they were trying to close a loophole that was being fraudulently exploited. Blocking short notice bookings is a nasty devaluation. Hope they learned from this and give notice next time they want to devalue.
I am troubled by the frequent disappointment about the Alaska FF program. Almost Delta-ish with sudden, poorly explained changes (Emirates) and erratic availability issues on partners, erosion of its partner airlines. Used to think of it as our last hope. Not so sure anymore.