Last year, Star Alliance CEO Jeffrey Goh hinted of at least one additional tier of Star Alliance status above gold status. One year later, those plans have been shelved.
Speaking at the IATA Conference in Seoul, Goh noted a shifting priority:
The priority at this time is to pursue delivering additional benefits to existing tiers, either from the member airlines or things we can coordinate as an alliance through other travel partners.
Christian Draeger, Star Alliance’s Vice President of Customer Experience, also chimed in, telling the Australian Business Traveller:
We’re in the middle of a review on this, but it’s not only about new benefits: it’s also the extension and the upgrading of existing benefits.
Draeger added, “It might very well be that (the third tier) will be periodically looked at again. But right now, we’re just really focused on the benefit side.”
I am not of the opinion that alliances are out of fashion and largely irrelevant in 2019. Even as their mission has evolved over the years, alliances remain a powerful marketing tool for member carriers and a continuing opportunity for synergies and collaboration. The Star Alliance brand is still a very powerful, very valuable brand. Alliances have also made seamless award travel around the world possible, something we tend to take for granted.
But a Platinum or Diamond tier of Star Alliance status had inherent free-rider issues. Let’s assume, because I think it is reasonable to do so, that a central component of a higher Star Alliance status would be access to first class lounges. Who wouldn’t love having access to Lufthansa, Singapore, SWISS, and Thai First Class Lounges? I suspect that was precisely the problem.
There are 27 airlines in the alliance and only the following seven have first class:
- Air China
- Air India
(I left Asiana off the list because it will soon eliminate first class)
Let’s say that Diamond-tier status is awarded to top-tier members in airline loyalty programs. That may be fine for, say, Lufthansa HONs and United Global Services, which have high spending requirements. But what if top-tier members of programs like Aegean, which require only 48,000 miles/year were awarded Diamond status? Or what about those with Asiana Diamond Plus status, which requires only 100,000 miles over two years?
My point is that you would undoubtedly see more passengers in first class lounges, thereby making them less exclusive. To the purveyors of the world’s best first class lounges–Lufthansa, Singapore, SWISS, and Thai–I think this was a huge turnoff. For the same reason, passengers on partner first class tickets generally cannot access these first class lounges. For example, Singapore First Class passengers cannot use Lufthansa First Class lounges in Frankfurt, or vice-versa. There is simply no desire to make these lounges more accessible.
A Potential Solution
While this certainly implicates privacy concerns, imagine if Star Alliance Diamond status was awarded by the alliance itself, not individual airlines. What if airlines nominated their top 1% of spenders, subject to a a minimum spending of $50,000/year (I’m just throwing out numbers) to Diamond status? The cards would be sent by Star Alliance and benefits maintained by Star Alliance. Thus, the higher status would be beyond the airline itself and in the hands of a marketing company (because that’s essentially what alliances are) that could work as an agent for all members carriers. I’d wager that even Singapore and SWISS would probably like to show these sorts of passengers warm hospitality, in hopes that it would lead to direct business.
By truly placing strict controls on who receives Diamond status, the first class lounges need not become overcrowded. And by making Diamond status super-exclusive, the reputation of the brand would likely strengthen and interest would drive business.
The short-term solution remains what Star Alliance has already promised:
- Seamless partner seat assignments
- Paperless, efficient crediting of miles
- Baggage tracking using the Star Alliance app/carrier of your choice
- Online redemption for all 28 Star Alliance partners when using any Star Alliance loyalty program
Those improvements will indeed drive more customer satisfaction. A more dynamic upgrade system that is easy to confirm, even on a mobile device, would also be a welcome improvement.
But a higher tier status than gold still remains an interesting proposition.