And now, the talk you’ve been waiting for. Let’s talk SkyMiles. As someone who considers himself miles-agnostic (meaning it doesn’t impact my flight purchase decision), it’s kind of funny that I end up getting into the details with these programs. But I know that it’s a topic that’s important to a whole lot of you. And SkyMiles is one of the more talked about programs.
It’s a program that many elite members love to hate, but it hasn’t deterred them from actively participating. Sure, many former Northwest elites have put on the rose-colored glasses and miss the days of WorldPerks, and others have a long list of complaints as well. It’s a tough balancing act for the airline, and that was the chief topic of discussion when I sat down with Jeff Robertson, VP of SkyMiles.
Despite what you might imagine, Jeff doesn’t wear a bullseye on his back, but he really does enjoy debating what’s right for the program. I found him to be thoughtful, and when our allotted time was up, the conversation just continued, probably to the dismay of the people waiting outside for his next meeting.
As you might imagine, he began by saying that “we want to do what’s right for Delta.” Of course, that’s never going to please everyone, but I was particularly interested in what that meant for dealing with the competition. American and United/Continental were that ones that had me most interested because they are the main competitors, have more flexible award use and, in my opinion, have better availability at the lower levels. So what about them?
He admitted that it’s really difficult to compare availability across airlines without just manually looking at routes, but they have recently decided to work with a third party to help get better insight on what others are doing. So this isn’t something Delta is ignoring. Then, he went to the spreadsheet to talk about availability.
It seems that Jeff has his availability reports accessible at all times. He pulled one out to give me a snapshot of what he was seeing. “We were tight this summer with availability.” But things are now more open. It seems that this will be an ongoing struggle for the airline, but it is something that is constantly on the radar.
Some more interesting topics from our discussion . . .
On Eliminating Last Minute Award Fees
“When we eliminated the award redemption fee, the percent of increase in redemptions was tremendous. It was one of the best decisions we’ve made. That’s not coming back.”
On One Way Redemptions
“There’s no reason we haven’t done one-ways. It’s just not at the top of the priority list.”
On Having Three Redemption Tiers Instead of Two
“The purpose was to provide another pricepoint that wouldn’t require double miles. We felt like introducing 40,000 and 60,000 is the right solution. Really, 40,000 miles is becoming popular. We have 90% or greater availability in that tier. So instead of someone spending 50,000 miles to come back at 4p on the Sunday after Thanksgiving. They can spend 40,000 miles to come back in the morning on Sunday or 60,000 to come back at 4p. It helps us manage demand.”
On Upgrade Co-Pays
“It would be really easy for us to do a copay. I don’t like them, so it’s not a priority of mine. I have bigger fish to fry.”
On Only Allowing Elite Upgrades From High Coach Fare Classes
“We have looked at YBM [the three highest fare classes that are the only ones allowed to be upgraded on international flights]. The #1 ask in the elite program is to let us upgrade off discounted fares. Two reasons why we don’t.
1) We don’t historically because we have free domestic upgrades, so we don’t subsidize international upgrades by making people pay for domestic.
2) We measured upsell to M [so that the ticket could be upgraded] and it is hundreds of millions of dollars
So we continue to look at what things do we do to YBM to make it more valuable, provide a better service benefit.”
On Rollover Miles
“Rollover miles are paying off big time. Elites are significantly ahead of where they were last year excluding rollover.”
On Getting Feedback
“The most important feedback for us is what we get directly. We also do surveys, and yes, we look at FlyerTalk, blogs, news media.”
On Choice Seats
“When we rolled out Choice seats, we got killed [in the media]. But American rolled out the same program and there’s been nothing. Delta’s the only carrier not charging. Is it gaining us market share? At the same time, I hate them myself, so it’s tough. I do think seat assignments are the next horizon [for fees].”
On Mileage Earning
“We have the most generous earn program. We always give a full mile regardless of fare class. We always give 500 minimum miles per flight to every passengers. With that said, we’ve looked at recently how many miles we give per dollar – it’s about 5 miles per dollar spent with great variation. We’re looking at what to do.”
On the Future of the Frequent Flier Program
“The frequent flyer model of over-awarding is not sustainable and must be changed. It’s either going to be redemption or accrual or both.”
—
Yep, it was an interesting discussion. Now let the commenting begin. I know you all have plenty to say.
47 comments on “The Delta SkyMiles Discussion”
“The frequent flyer model of over-awarding is not sustainable and must be changed. It’s either going to be redemption or accrual or both.”
I am not sure what exactly is over-awarding in the current program. He should try to fly around (domestic+international) as a GM.
Basically that guy is telling us that Delta is going to charge us more and that we will get less. That would be a tremendous opportunity for me to leave Delta (to which i have been ridiculously faithful so far) to see if the grass is greener on the other side. I do not have any problem with accrual which is fine as is but redemption is already way too difficult.
Well, maybe the model becomes one where accrual gets tighter but that enables easier redemption? I tend to agree with Jeff that the current model isn’t the best way to do it, but there are so many people invested in it that it’s hard to change. But it’s certainly worth discussing, no?
Did you bring up the broken online award calendar, or was that something only the web guy would discuss?
Only the web guy. In fact, I went straight from the web conversation to the SkyMiles conversation, and when I got there, they said, “Hey, did you ask Bob about the award calendar?” with a sheepish grin. So clearly the web guys are the ones who have to take care of that and the SkyMiles folks would like to see that happen sooner rather than later.
Was there any discussion about the Skymiles AMEX card? I’ve been very pleased with the free checked baggage benefit, which pays for itself quickly on leisure travel where going carry-on only is difficult. It’s a good gimmick that can attract a family once and eventually get them hooked on the crack that is Skymiles. Very savvy, but it will backfire if award travel is difficult or the redemption tier is too high. Does Delta make it a priorty to open up more award seats on flights to leisure spots like Florida?
Didn’t Delta just sign up a program with Master Card yesterday? I thought I saw a news headline about that.
I read that too. Supposedly a debit card agreement so I doubt it will carry all the same benefits the AMEX credit card holders get.
Ok, I saw the bi-liine about DL and Master Card but forgot to go back and read the story.
Now that is interesting as Debit cards are being used more (so I read) then credit cards by people who are watching their money in these hard times. That would mean DL is thinking about those people and trying to get them to switch to their branded debit card to get miles. But the people watching their money in these hard time would tend to purchase lower priced fares that none of the major carriers what people to do, and would not be flying much if they don’t have the cash in their bank accounts so they are not who DL is treating well by reading some of the other comments. Guess DL is trying to trick these people into thinking that if they keep flying on DL with those debit cards they will get free trips. But by the comments, higher mileage holders are having trouble getting free trips so what chance do the fly 1 or 2 times a years debit card users have.
It’s for debit. There’s no way DL’s overlord/sugar momma AMEX will let them get in bed with another CC company.
I saw in the newest Skymiles magazine, that Delta did have a M/C cc offer but it’s for Canadian citizens I think.
We didn’t get into the Amex deal, but that would have been a good way to go. If only I had more time. As for more seats to Florida, we didn’t get into that specifically, but they know there are certain leisure destinations that are going to have higher redemption demand than others, and that’s definitely one of them.
Here’s the info on the debit card deal with MasterCard.
“””””So instead of someone spending 50,000 miles to come back at 4p on the Sunday after Thanksgiving. They can spend 40,000 miles to come back in the morning on Sunday or 60,000 to come back at 4p. It helps us manage demand.”””””
More like it gets more miles from the people who still want to come back later in the day on that Sunday.
Exactly. I think you and Jeff agree 100%. What’s the problem? Delta is putting a premium on the most-desired flights and offering those customers with flexibility the opportunity to save. Makes perfect sense to me. In fact, it’s better for everyone that they do it in such a way.
Yes but think of this, instead of giving up the more valuable ticket for less miles, they take more but offer a less expensive option on a slightly less valuable (but still desirable) ticket.
Cranky here’s a question for you about these type interviews.
Do you ever get feedback from the airlines after you blog these interviews? I know comments are left that are not always postitive towards the airline who gave the interview. But you know they or their people are going to follow them.
Has any airline said they wouldn’t give you an interview as they don’t want their airline to be blasted in the comment section?
I actually rarely get feedback, but sometimes I hear from them. I don’t think I’ve ever received a negative response from anyone because, well, it’s their words and for once, I’m not editorializing! The comments may not be all positive, but that’s not really the concern. The number of people who read the comments are far less than the number who read the post itself. I think this is a good opportunity for airlines to explain their positions on things, and even though comments tend to sway negatively (on every subject), there are far more people who read the post and come away with a different feeling.
“Really, 40,000 miles is becoming popular.” Well, yes, if that’s what you’re going to make available. Try making a bunch of 25,000 mile seats available and tell me how that compares to the 40k award ;)
As for his last comment, I don’t know how to take it in the context of “what’s best for delta” because there are a couple of problems here:
1) If supply (seats) doesn’t match demand (miles) the airline has an image problem with their customers. In this regard, it would make more sense to restrict the miles available so that customers can be confident they can use the miles they have in a manner acceptable to them. However…
2) The airlines make bank selling miles to banks and other affiliate programs, so I don’t know how restricting mileage availability will impact the bottom line. However…
3) If Delta chooses not to restrict demand (miles) and ups the cost of award redemption, they’re back to an image problem wrt the competition. If Delta’s “standard” award is really 40k, and the others still have decent availability at 25k, then there’s that pesky little PR issue again.
So I don’t know what the right answer is. One thing that I do know is that Jeff should do a better job engaging his customers — he likes to post his spin on Flyer Talk, but then never hangs around for some follow up. It’s rather annoying.
I think what you’re missing is that the 40k seats aren’t being left on the table. Why on earth would DL sell something for 25k miles that a customer is willing to buy for 40k? That’s just stupid. As long as someone is paying, you’re not charging too much. Basic capitalism. When people stop buying at all, you know you’re charging too much.
I think you’re right Dan (well, not about the FlyerTalk stuff, since I haven’t really watch that very closely, but on the rest of it). The problem with FF programs is that they aren’t set up ideally, but anytime you make a change the reduces consumer benefit, people flip out and get angry. So it’s hard to make any change at all without pissing people off except for the rare positive change that is good for both airlines and customers. What you really need is a bold airline to say, “this is broken. We need to fix it.” But with the competitive battle between the legacies, it’s hard to do that for fear you’ll lose people. For an airline like Delta which is trying to “win” hyper-competitive New York, that’s a huge concern.
I am in ATL and fly Delta a lot to travel to cities 500 (+or-) miles away from Atlanta.
I am glad to be a SkyMiles member (since 1990), although I do sense that Delta doesn’t care a bunch about those of us who primarily do “local” traffic on their network.
I am headed to Silver Medallion status this year due to frequencies (as opposed to mileage) and pay for a Delta Reserve Amex card.
But do Silver Medallions or even matter to Delta anymore? The introduction of the Diamond Medallion status (and the onboard announcements which no longer thank Silver Medallions) lead me to think not.
Perhaps this is because, based on the statements they make to local media, Richard Anderson and company are almost wholly focused on international passengers.
Locals like me seem to no longer fit Delta’s profile of the “ideal” passenger. Airtran senses that, has stepped into that void, and has won over many locals here in ATL (believe it or not, American is also doing the same and has a loyal following here).
Like others, who have posted, I am not sure what the right answer is here for DL, either.
But I do have one idea and quite honestly, what I would like most most would be inexpensive for DL to implement.
It would be nice if Delta simply thanked me for my business once in a while.
I agree that DL shows it no longer values you unless you fly at least 50k miles a year. Silver Medallions are no longer thanked on board, they are not invited to board early with the rest of the Medallions, they may no longer use the priority security lanes at the airport, etc. I wonder if Silvers were “demoted” because there were simply too many of them and Delta needed to raise the bar. At the height of the recession when no one was flying, the airlines were tripping over themselves offering double and triple elite-qualifying miles to entice people to fly. Even casual travelers could earn elite status with just a handful of trips. The result? Too many silver medallions. The solution? Create a new fourth tier that makes 25k passengers look like unloyal DL fliers who aren’t worth the airline’s time. I was lucky enough to earn gold status this year, so I guess I’m still (barely) valued–for now–until Titanium or some other new level for 250k a year road warriors is introduced. After being Silver for 5 years running, I will never forget the moment I approached the priority security lane at LGA earlier this year, only to be told, “oh, you’re ONLY silver. Please board with the general population.” Thanks, Delta.
From JM: “””””The introduction of the Diamond Medallion status (and the onboard announcements which no longer thank Silver Medallions) lead me to think not. “””””
Anytime you single out a certain group among a larger group, all that does is tell the lesser of the group that they mean nothing. Any airline on the P.A. that thanks Diamond members (or whatever) is just saying to everyone else that they could case less about them. That is like inviting 3 couples to your home for dinner and ignoring 1 couple because you like the other 2 couples better.
If that is how DL is treating people then they need to loose business to AirTran. But it could be their way of getting the cheap buying peons on the plane to fly AirTran so they can raise prices to people who purchase higher fare tickets.
From David SF eastbay: “”””If that is how DL is treating people then they need to loose business to AirTran. But it could be their way of getting the cheap buying peons on the plane to fly AirTran so they can raise prices to people who purchase higher fare tickets.””””
Yes, but DL currently matches AirTran on pricing– meaning cheap! DL is tone deaf to the fact that there are other ways to sell tickets to the locals besides price, namely loyalty, service, and perks.
I would gladly pay more for tickets on Delta than competitor AirTran because of: 1) SkyClubs/Crown Rooms, 2) Loyalty (they are Atlanta-based and generously support my employer, a nonprofit, among other reasons), 3) a better FF program than AirTran, and, 4) better frequencies.
However, since I don’t fit the “profile”, DL could care less– even as a Silver Medallion. Shouldn’t they try to play ball with passengers like me?
Meanwhile, even US Airways (my “backup” airline, which I fly sometimes), offers me many more ways to get elite miles, like their current Hop, Skip and A Jump promotion and otherwise aggressively seeks my business on a basis **other** than price.
Indeed, US also thanks me for my business out of ATL– which Delta does not. Go figure.
Has Delta forgetten it’s southern roots? What happen to southern hospitality and southern manners? Shows what can happen when you try and be the big cheese in New York, you start acting like those yankees in the north……LOL
“I would gladly pay more for tickets on Delta than competitor AirTran because of: 1) SkyClubs/Crown Rooms, 2) Loyalty (they are Atlanta-based and generously support my employer, a nonprofit, among other reasons), 3) a better FF program than AirTran, and, 4) better frequencies.”
I suspect there aren’t enough people that will pay more for these things to make it worthwhile. In other words, the revenue they’d lose by people going to AirTran, et. al. would be greater than the extra revenue they’d get from higher fares and targeting the customers who will pay for them to get the extras.
You’re probably right, sadly.
Guess I am flying US via Charlotte for everything starting next year!
I think just about every legacy airline has turned their entry level (Silver, Premier, etc) elite status into simply a fee waiver and not much more. You’re not going to get upgrades because you’re in the back of a very long line of higher tier elites. But not having to pay a variety of fees is a nice benefit even if it’s not as much of a benefit as it used to be. As we learned last week in the reservations guest post (and as I’ve heard anecdotally for years), silver elites tend to be the most demanding and difficult to deal with as well.
When I talked to Jeff about how there are potentially some Platinums who simply game the system and fly a lot of miles but are horribly unprofitable while there are some Silvers who are probably more deserving of being higher, he half agreed. He said he had very little concern about the top tier elites not belonging there, but he did have great concern about the silvers who are much more valuable and should be at higher levels.
This goes back to the system being broken. When you give away too many miles, you end up with too many people in your elite program, and they aren’t necessarily in the right place.
Forget the issue of 25K vs 40K/60K awards: does Jeff care that former Northwest elites who were used to 100K and sometimes 150K Int’l Biz awards to Europe & Asia now are quoted 280K+ for similar awards? That’s a hefty increase that I wonder if the spreadsheets he has handy are showing? Do they expect to retain the NW customers based on these kinds of increases?
280K to Europe is an anomaly and YOU know it. They need to fix the pricing engine and stop having it price your trips as Domestic mid tier F + Mid Tier TATL = 280k. It should price at 200k.
I see very much where you are coming from and don’t forget about Fake cheese…
Jeff doesn’t get it. AAdvantage is still the best around. he should be using that program as a comparative point.
+1 to that
Well, perhaps there’s a reason why AA is struggling financially. ;-) It’s certainly not because of AAdvantage alone — don’t get me wrong. I’m just saying… look at YX… “best care in the air” for sure but they couldn’t make money providing it these days.
I may be wrong, but I think Jeff came from AA? Can anyone confirm that. I’d hope that AAdvantage at least figures into the equation with him. And I agree, I think AA’s availability and overall program are hard to beat.
Yes, Jeff was at American, so he knows that program very well.
When you can fly one way in First Class from the US to Asia for 67,500 AA miles, Jeff’s comment about:
“The frequent flyer model of over-awarding is not sustainable and must be changed. It’s either going to be redemption or accrual or both.”
must apply to AAdvantage and how unsustainable it makes Skymiles look.
He doesn’t seem to care much for Delta’s most frequent customers.
D-E-L-T-A Don’t Expect Luggage To Arrive and Doesn’t Even Leave The Airport. I fly from DFW. It’s pretty much AA on longer trips and Southwest on shorter trips. Dl, UA, US,CO and others all require going way out of your way to change planes and at extra cost. On AA you can fly nonstop all over. Actually, I’ve been pretty much satisfied with all the frequent flier programs. A bad thing About AAdvantage. If you try to book award travel overseas online, the message comes up that AA doesn’t fly there. (Hello-Oneworld). You have to call up and pay the fee to get trips. Another bad thing is that AA doubles the miles to fly overseas between May 15 and Oct. 15. I don’t know if any other airline does that. I called to use AA miles to go to Hong Kong and was told not available at that time. I asked about Bangkok and it was available….with change of planes in Hong Kong.
I spent 1998 to 1008 as Gold Medallion every year (only flown holiday’s in ’09 not at all this year). But I have never had a problem with SkyMiles, maybe things have changed, I don’t know. But what I remember most, I had a flight scheduled from CDG-ATL on 11 Spet 2001…that flight never took place, but when flight’s resumed, I had priority, and was able to return on the 19th (thanks to Medallion status).
I have never had a problem getting a reward ticket (I remember one flight, I got a ATL-HNL ticket for 30k miles, but the fare dropped to $250, so they let me redeposit the miles without a problem).
I can’t speak to other programs, but skymiles is great (granted in recent years, even as gold upgrades wre becoming scarce, so silver must be almost impossible)
I even remember one glight (LON-MAN) on a reward ticket, where I was upgraded on both segments to business (and even SAS upgraded me to business on MAN-CPH anfter my flight arrived in MAN an hour late). Again, I don’t know what the other’s offer, but DL has been great for me…except for that year where the pilots where doing sick out at Christmas time and I caught that flight two days later…but having to go and spend each day at Hartsfield running from gate to gate hoping to finally catch a flight (Christmas 2000 I think)
It’s going to be hard for be this year with no status, oh the humanity
Cranky, did you get any information as to whether members might one day be able to redeem one way awards (at half the price of a round trip award)? It seems to me that some of these problems might be overcome by doing that.
That’s in the interview. He says that there’s no reason it hasn’t been done other than the fact that it’s not the highest priority. So we may (hopefully) see that someday, but he wouldn’t say that for sure.
Ooops – missed it the first time. Much appreciated.
I have back to back international flights and I’m 6000 miles from Gold. How long will it take for Delta miles to post after flying on Delta partner ALITALIA? Need it to be fast since I want the computer to show that I’m Gold on my second trip. Has Delta linked the computer systems between partners? I hope its not 30 days and a fax or two for the miles to show on my account.
I know with AF, KLM, and KAL miles are posted as quickly as with DL, Atilia, I don’t know. However, Delta only updates the status database on weekends. Yes, I’ve been on a flight where I had 53,000 MQM miles whowing in my account, but was only considered Silver until the next weekend. Fortunately I showed that to the gate agent and she put me at the top of the list of Silver’s for an upgade (won’t help with mileage bonus, but better than nothing)
I just hit Silver status for the first time ever, pretty excited about it. Can fly back and forth to EU without paying for a second bag! I been flying Delta/Skyteam (boy do I miss Continental when they were part of Skyteam) for over 5 years now, all my tickets have been on my dime which makes it all the more enjoyable. I’m thankful for being zone 2 now instead of zone 3 or 4 on some flights. Since I travel light 90% of the time (carry on only) it’s nice to have early pick on overhead bins ;). I don’t know if SM get luggage tags like they used to back in the day, I wish we could. I’m sticking with DL regardless. Air travel has become a patience game at times, and there are times where things don’t go as we planned unfortunately. I’m content on getting to my destination safe and sound, because in the end that is all that matters.
Hi,
Today is March 1, 2014. I just read your article and the comments that go back to 2010. Well I’ve been a Delta Skymiles member since 2007 and I’ve been talking with Delta Medallion agents for two years about the award calendar being lacking of quality. They continue to tell me they know of the problem etc.,etc.,etc. but nothing gets corrected
When the new rewards plan takes effect in 2015 I will be dropping Delta and switching to Alaska Airlines. I’ve had enough with Delta’s degradation of their program and insulting behavior toward their most loyal passengers.
Jeff Topping
Dubai, UAE