Some programs have offered status extensions, challenges, and double elite credit – are loyalty programs still struggling to get elite travelers back?
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Travel Has Been Back… Leisure Travel
There’s no question that travel is back this summer for leisure travelers. Rammed airports, long waits, cancellations, and full flights have been the hallmark of this summer travel season across the US and Europe.
Corporate travelers still lag. Delta reported that corporate bookings are still down by about 40% from 2019 numbers which is a great advance over the last couple of years, but not nearly enough for the lifeblood of airlines. Business travelers that fill last-minute seats at higher prices and often in premium cabins are still not on the road in the way they once were. United, which relies in part on its extensive Asian network to key business markets has seen no “meaningful recovery” for business clients in that region.
“Marriott said on its earnings call this month that the number of room nights booked by individual business travelers in the United States and Canada was down 10 to 15 percent in March compared with 2019 levels.” – New York Times
As summer comes to a close, children are back in school, and the weather changes, leisure travelers will begin to fall away. Without the same number of price-insensitive customers, even with fewer flights in the fall, pricing will fall. Lower prices mean fewer qualifying dollars, coupled with fewer corporate travelers taking fewer trips.
British Airways Status Extension
British Airways has offered status extensions to some of its members earlier this year. That was long before summer started, though many could understand if British Airways needed to do this anyway due to the hellish summer London Heathrow has had. That said, some of the incentive to extend status has to relate to where travelers are trending at the moment and how many elite travelers they expect to either retain or grow.
Hyatt Double Nights Credit
The World of Hyatt loyalty program has added double night credits in places. The brand’s new small business credit card is offering double elite nights booked with the card. This could be a temporary option to promote the new product, but it’s worth noting that Hyatt also recently offered double elite nights for bookings at their many all-inclusive properties.
Both of these examples are targeted but there are a number of other levers that Hyatt could have chosen to use. Hyatt could have instead chosen to offer double, triple, or quadruple points. They could have offered Category 1-4 free night awards. They could have tried the same promotion they used earlier in the year, offering a discount or rebate on award nights booked.
Instead, World of Hyatt chose to offer double elite credit nights and it would be foolish to ignore that the other options were passed over. Both of those promotions were launched in the last two weeks to the best of my knowledge.
Challenges, Status Matches, Extensions
LATAM, the largest carrier in South America, has announced a status match in an attempt to lure new customers. World of Hyatt is at it again, utilizing its relationship with the American Airlines loyalty program to offer key elite members a fast track of elite status to bring them into the brand. United Airlines quietly extended Plus Points (upgrade instruments) for its members who were set to lose them halfway through the year (I was one of them.)
American Airlines Loyalty Points has also offered Concierge Key to some business clients to lure them back to the extent that some employees attempted to sell those challenges on eBay. While it’s not an act of desperation nor unique for American Airlines to offer this to important business clients or targets, it usually isn’t when airplanes and revenue are at all-time highs.
Conclusion
Taken individually, these might be seen more as airlines and hotel chains trying to switch things up and attract or reward more loyal customers, but taken together, I’m not so sure. Customer loyalty programs, especially for airline partners, are incredibly important to the profitability of the brand. American Airlines often loses money flying people and cargo but makes money solely from their loyalty program and from the Aadvantage credit cards. Without as many corporate travelers to fill newly vacated seats in the fall it makes sense that brands are starting to look ahead and secure their ranks before it becomes an act of desperation later in the year.
What do you think? Are elite members down? Are these normal business measures, one-off situations, or part of a larger picture?
I think 2023 will be a clean up. It is disgusting to see how many Diamonds Delta has right now that are only Diamonds because of the extension of status from the pandemic. As a Diamond that earns it every year it is crazy to see my name in #30+ for an upgrade. That was never the case before the pandemic. Once the party of extension is over I expect to see it back to normal.
Agreed completely. As another DM who earned it throughout, it’s been a horrible year. We were promised to be ahead of the others but clearly this is not happening.
If you’ve already requalified this year, you should be listed ahead of DMs on extended status. Per Delta’s upgrade rules.
I’ve never seen a DM in the 30s in either case…
Not surprised. They’ve tried to cut every single corner, pare down every amenity and service when they can, raise prices, while accepting government handouts and still failing to resolve staffing issues. They’ve done almost every single thing wrong.
Airlines are pretty bad but the hotels seem to be even worse at this. This is why I just go for the cheapest nice boutique hotel instead of narrowing my choices to a Marriott or a Hyatt and look forward to new ways they can bone me.
“the cheapest nice boutique hotel”
Bloody hell. You must have won the lottery. You were in a hostel till yesterday.
In Asia I did hostels because they were more like capsule hotels. With covid and everything I opt for cheaper full room hotels in Europe (plus hostels in Europe look dingy)
Not trying to be rude, but how old are you? In my youth I did hostels to save money. Now I may not have more money, but I put a higher value on privacy and solitude, which you don’t get in a hostel or even a cheap hotel.
I am single and younger than probably most people here. Some of the dorks here that fight me over politics are probably twice my age.
Would you please clarify this statement regarding Hyatt’s small biz card? “business credit card is offering double elite nights booked with the card”. My understanding was that cardholders would receive double elite nights even for those stays booked with points – is that not the case?
@JakePB – In the linked post and in the email I received, I saw no mention of award nights. The rule specifically states nights “booked with the card” so that would lead me to believe that there would have to be a transaction associated with the stay to identify that it was booked with the card and thus some amount of money paid. It could qualify for award nights if there is some cost associated with the stay that trigger a charge but that seems to be more of a technicality exception rather than the intention which appears to be paid stays.
Jan your correct I think many other travelers are doing or beginning to shop around. Business travel in general has changed where it will settle no one knows but I venture less than pre pandemic levels. Rather than the continual irritation of getting less and less for your status look around. I have always contended that if the airlines/hotels stopped giving out points and status think how much less things will cost. Case in point when grocery stores stopped giving out green stamps prices stabilized / went down a bit.
The only real benefit of status at hotels for me was the breakfast now that is gone for the most part.
Agree 100% on the take. Used to put 100k (sometimes 150k) miles a year pre-pandemic, and this year have had less than a dozen business trips. However, about to re-qualify for Platinum Pro and possibly get EXP, and not because of corporate travel, but thanks to incredible J tickets bought directly with IB and BA, the shopping and hotel portals, and overall spend on my AA card for everyday items where all CCs usually only give 1/1 per dollar spent. Incredible how the new program has shifted my CC usage towards my AA cards! Also, the J class tickets credited to AA are still distance-based, and with generous cabin and status bonuses, I am getting 22k to 25k per ticket, about double the LPs if I had bought the ticket directly from AA. I think AA nailed it with their new approach, because I am going to get the 30 segments on business travel alone, but if I had only flown with AA, I would have probably only made PLAT. These incentives to shop via the portals and book hotels via their sites are working at least for me. The leisure traveler in me tends to book boutique hotels anyway, so instead of hotels.com, I am using AA portals and getting sometimes 6/7k LP per nights booked at around the same price as if I was booking through other online portals.
Hotel status is a whole different monster, and will probably stay mid-level with Bonvoy but might be able to squeeze another year of GLO from Hyatt if I plan my next few trips accordingly. Luckily, corp. travel is taking me to mainly metro areas, so booking a Hyatt is doable.
I am a business traveler. I was elite on multiple airlines and not just the bottom level. On 1/1/2023, I will be cattle level non-elite on every airline. I mourn that but also rejoice in that I will be a free agent.
Not taking the bait. Only dumb fishes take the bait. Then they get plucked from the water, asphyxiated as we watch and enjoy their suffering while pretending to be religious, skinned, filleted, grilled and eaten.
I am not a fish. Not taking the bait. Let others get filleted, grilled and eaten.
By the way I am sloghtly jealous of all you guys who get to travel for work.
Traveling for work is glamorous, exciting, and interesting.
Until you have to do it all the time. Then it’s easy to get sick of it really fast.
A lot of times it feels more like “work” than you’d think.
Well, I probably don’t want to be a sales/marketing type or similar either (who can rack 100+ segments in a year). I’ve worked in plants; I’m usually tied down 99.9% so every travel I do is for leisure and obviously on my own pesos.
I suppose grass is greener, etc!
The sweet spot is probably a couple/few times a month. You aren’t getting top tier status with that, but if you have family you aren’t missing them and you won’t get burned out on travel. You can still scratch the travel itch and get somewhat meaningful status that can benefit your personal trips.
DC is right – I don’t envy the road warriors who earn invite only status because they do so much volume flying and being away from home most of the month
Unless your a Ryan Bingham type.
Do you need to book with the Hyatt business card to get the double nights? Because my understanding is that award nights etc count.
I am not renewing my Hyatt Globalist status this year, staying mostly at non-points hotels. I re-qualified for Delta Diamond and will shortly for BA Gold, but those were somewhat accidental and I’ve only flown Delta twice since re-qualifying for Diamond. Status in all hotel and airline programs has limited benefit at this point, just seems easier and cheaper in the long run to pay for the service you want. However, I think airlines and hotels have gutted the programs to such an extent that they will be forced to let the pendulum swing back in a couple years, like 2024-2025. They’ve been happy to charge leisure travelers 2X or 3X typical prices for most of 2022 and they think it’s the new normal but that’s not going to last. These people who are stacking food 10 inches high on their plates in the lounge wearing flip-flops and backward baseball caps are not going to stick with this much beyond 2022. Just need to wait this out until the airlines get more desperate, and if they don’t then I am completely happy to continue free agency.
Until 2019, I was Platinum on FlyingBlue (Europe here), and also top level with Qatar, Hotels.com (most places where I travel have never seen a major brand) and mid-range with Miles&More.
As of 2023 I will keep hotels.com, be top level with Radisson Rewards out of anything, because I stay-cated at my local hotel with pool, but probably be rock bottom across airlines.
Used to have 65+ business class segments per year across airlines. Barely 12+ segments up to this point in 2022. So I do not expect anything else.
On the other hand since 2020, I can count on one hand the situations where status itself helped. Since I travel in paid business, everything that I could get via status is included.
So am I sad? Maybe, thinking of future leisure travel. But not much.
Although it’s likely highly secret, it would be interesting to see graphs of elite numbers by year for the past few years for each of the big 3 domestic airlines. At this point, it seems like status is less about rewarding than it is about retaining. As you mentioned, summer has been amazing for leisure travel, but summer is winding down now…
I’m curious about the number of elites too. Although I have AA EXP status, I don’t have much exposure to others because of where I’m typically traveling from (MSP) and to (PVD) – respectively a Delta hub and nowhere via one of several hubs. So things like upgrade lists aren’t particularly illuminating when they’re either very short or not present at all.
I just want to add that Marriott and major hotel chains in the US lost elite members because they used Covid as an excuse to cut back amenities, and while Covid is not 100% gone, it is no longer an acceptable excuse not to restore these elite benefits and basic items like daily housekeeping (or at least an option). There are less and less incentives to stay at these major hotels when you pay a high rate, while not getting anything in return. Hotels in North America are just the worse and I actually think airbnb will be more popular, unless these major hotel chains start to do something again.
We are still in a state of flux:
a) a recession is imminent, so corporations are hesitant to deploy the troops unless necessary
b) corporate budgets will be tight and this is the #1 killer of business travel
c) inflation is in the air, in your pocket book, and corporate governance
d) a wave of layoffs is in full swing, the bedlam of COVID has receded, reality is the new norm
e) video conferencing has proven itself; therefore, a certain % of business travel is permanently lost
f) airlines, credit cards, & hotels went crazy with givebacks and extensions to hold onto that last dollar and last customer. If in doubt, look at the encampment of those trying to get into Delta Sky Lounges at ATL.
All the above will clear out in the next year to 18 month. Road warriors will be in full swing, but the excess of COVID is over. The airlines, credit cards, and hotels will need to earn their keep in a rational environment and will focus on those who generate the most revenue.
Rewards await all, just a little patience is needed.