Now that the dust has settled, I am trying to get a feel for how Delta Medallion elites will approach loyalty on Delta going forward. Will Delta Air Lines’ candor about its ultimate intentions deter loyalty now? When it comes down to it, will you fly Delta no matter what?
Will Candor From Delta Air Lines Be Rewarded With Continued Loyalty?
Delta Air Lines announced draconian changes to its SkyMiles loyalty program, then rolled them back partially after intense pushback. Next year, more spending than ever before will be required to attain status, but Delta – American Express co-branded spending will now count toward achieving that goal.
But Delta has been absolutely honest about its intention of making it far harder to earn elite status. This was again affirmed in a recent Bloomberg interview with Delta CEO Ed Bastian, as noted by Ross Feinstein:
“There were some things that we did that I thought were maybe too aggressive in trying to get to that equilibrium quickly. We pulled back and said we’ve got to go at this at a much more measured pace.”
That equilibrium per Bastian, is supply versus demand of premium amenities like front cabin seats and lounges. Delta saw too much demand for its limited supply and took steps to adjust it in a way that would reduce expectations while also promoting Delta’s best customer of all, American Express, by incentivizing more co-branded credit card spending.
And to Delta’s credit, it has been quite honest about this goal. In taking a measured pace, Bastian says Delta will continue to “build new premium clubs, new premium assets to allow the demand set to be satisfied, maybe in a little bit better manner.” That’s important too, as the most logical response to increased premium demand is to provide more premium cabin space aboard and in lounges.
There is some hope that as Delta increases its premium footprint, such a devaluation of its loyalty program will not be necessary.
But the sense I am getting is that Delta has little to worry about it. Because I know many readers who did follow though on cutting up their Delta credit cards, but far fewer who will stop flying Delta.
And that’s the point, isn’t it? Delta is banking on its image as a reliable, premium carrier (both claims are overrated) that with or without status, passengers will continue to fly. And they will also continue to credit on SkyMiles and use a Delta credit card because most folks will figure it is better than nothing.
I really question whether the high spenders on Delta co-branded credit cards will offset the many travelers who finally realize that using a credit card with flexible currency or even a cash back card makes so much more sense than collecting SkyMiles.
I focus on the redemption side of loyalty program, which is a huge driver of my own demand to seek elite status (on United Airlines or previously American Airlines). Both of those legacy carriers offer a far more valuable premium cabin redemption opportunity than Delta. In many cases, it is not even close.
And yet Delta’s flash sales in economy class offer value to the “average” customer and therefore my condemnation of the redemption side focuses on a narrow subset of the flying community.
Please, weigh in below. Because now I am feeling like Delta will get away with all these changes…and that makes it far more likely that American and United will follow. Furthermore, Delta’s positive changes to its Million Miler program will certainly encourage long-term loyalty.
Will Delta Air Lines get away with making it substantially more difficult to earn elite status? I tend to think so…but I would love to hear I am wrong. Let me know your thoughts on this and if you are staying with Delta, please help us understand why and what it would take to make you break away.