Travel loyalty programs are desperate now. Here’s what they’re doing

loyalty programs are desperate

Travel loyalty programs are desperate to keep you at a time when no one is traveling. Whether they are successful or not depends on people like Karen Kinnane and Mitchell Telsey.

Both frequent travelers have made one of the most difficult decisions of 2020, at least when it comes to their travel spending: whether to stay loyal to a preferred airline, hotel or points-earning credit card.

They know travel loyalty programs are desperate, but these are desperate times.

Why travel loyalty programs are desperate

Travel loyalty programs have been pulling out the stops to entice members to stay. They’ve reduced or waived annual fees on credit cards, added bonuses, and tapped the brakes on point devaluations. It’s part of an industry-wide effort to remain relevant at a time when the pandemic is redefining the concept of customer loyalty.

But it’s still too soon to tell whether their strategies will work.

“Since most people aren’t traveling, it might seem like travel credit card perks have lost a lot of their value,” says Ben Walker, a credit card expert for FinanceBuzz, a personal finance site. “Premium benefits like airport lounge access and annual travel credits aren’t very useful when you’re stuck at home. What’s the point of holding on to a travel credit card right now, especially when it might have a high annual fee?”

There’s a lot at stake. For some businesses, particularly airlines, the loyalty program is the most profitable part of the organization. If the program fails, so could the company.

Why some people are leaving and others are staying

Telsey, a sales manager from Philadelphia, says the annual fee on his Chase Sapphire Reserve card rose from $450 to $550 in January. Then the pandemic struck. Chase offered cardholders like him a $100 credit if they renewed, but he declined.

“There’s no way I’m going to re-enroll when I’m not traveling for business like I used to,” he says. The primary reasons for having the card, like lounge access and extra points, have vanished. And now, so has his card.

Kinnane, an antiques dealer from Pompton Plains, N.J., is keeping her United Airlines-branded personal and business credit cards — and, with it, her gold loyalty status. She usually flies to Germany every other month, and for her, the cards are worth it. Even now.

But Kinnane says she wasn’t swayed by any of United’s pandemic pitches, like its recent offer to sell miles at half price or a generous triple-miles offer when a card is used for grocery purchases. She’s keeping it because she believes that travel will bounce back soon and that United will be there for her when it does.

“I may occasionally pay a little more to use United, but the excellent customer service is priceless,” she says.

What travel loyalty programs are doing to keep you

Some changes in travel loyalty programs have been conservative. Enterprise Holdings — which owns the Alamo, National and Enterprise rental car brands — extended the expiration date on points and on elite tiers for National Car Rental’s Emerald Club and Enterprise Rent-A-Car’s Enterprise Plus. It’s also extending the deadline for redemption of days earned through National’s One Two Free promotion through the end of the year.

Patsy Rey, director of loyalty marketing at Enterprise Holdings, says the moves underscore the company’s commitment to its customers. “While travel has waned, customer loyalty has not,” she says.

Other programs shifted their focus away from travel benefits and created promotions that reward everyday purchases.

“With travel volume down, we shifted our strategy to promote non-travel offers such as earning points for future travel with our flower and shopping partners,” says Vicky Radke, senior director for Amtrak guest rewards. Amtrak also began promoting a no-fee co-branded credit card designed to keep members engaged even when they’re not riding the train.

Arline loyalty programs are desperate

Airlines were more aggressive — some might even say desperate — with their promotions. American Airlines, for example, extended elite status for AAdvantage members through Jan. 31, 2022. It also offered up to $400 in special credits on American Airlines Vacations packages for loyalty program members. And it waived award-reinstatement fees for travel through September.

“American was also one of a few major airlines that offered generous mileage bonuses for people who bought miles in recent promotions,” says Lelah Manz, a senior vice president at Akamai, an Internet services company that monitors travel loyalty programs.

And points-earning credit cards? There, the changes have been dizzying.These travel loyalty programs are desperate to stem the COVID-19 losses.

Chase Sapphire Reserve members are getting five times the points on up to $1,500 of gas station purchases through the end of September. And points are multiplied by a factor of 10 for subscription fees paid to services like Netflix and Spotify during the same period. Citi Prestige Card’s members can use their annual $250 travel credit at supermarkets and restaurants through the end of the year. Capital One Venture Rewards members can redeem miles as a credit for eligible food delivery, food takeout and streaming services.

Experts say the shift to streaming and food services is a response to “temporal discounting.”

“It’s the tendency for people to value immediate benefits more than those off in the distant future,” says Barry Kirk, vice president of strategic services at Maritz Motivation, a loyalty consulting company. “In times of uncertainty, this human default can be significantly intensified.”

But are these program changes working?

But are these offers keeping us loyal? Probably not, experts say.

“In general, loyalty program incentives during this time are actually not working,” says Alex Miller, founder of the loyalty program website UpgradedPoints.com. “At the end of the day, safety is king. Consumers are hesitant to travel, and won’t do so to earn a few more points or credits.”

And loyalty doesn’t always go both ways. Talk to a customer like Edward Gerety. He’ll tell you that all the offers in the world won’t sway him unless a company is willing to reciprocate his loyalty. Gerety, a financial manager who lives in Kaneohe, Hawaii, said he canceled American Airlines tickets to the mainland after a surge in covid-19 cases. “American said it would cost each family member $150 to redeposit our points,” he says. No amount of negotiation would make it budge.

Finally, he emailed several executives at American. A representative called him and waived the fees.

“These airlines will be hunting for bailouts soon,” he adds. “Congress should see this for what it is: private companies profiteering off the American taxpayer during a national emergency.”


Are you going to fall for it?

Are you planning to participate in a travel loyalty program this year? As a longtime critic of loyalty programs, my answer will always be: no. But what’s your answer? Are these generous credit card deals enough to keep you loyal to a company that may not exist next year? Are you willing to collect points that may be worthless soon?

Posted in The Navigator

Christopher Elliott is the founder of Elliott Advocacy, a 501(c)(3) nonprofit organization that empowers consumers to solve their problems and helps those who can’t. He’s the author of numerous books on consumer advocacy and writes weekly columns for King Features Syndicate, USA Today, and the Washington Post. If you have a consumer problem you can’t solve, contact him directly through his advocacy website. You can also follow him on Twitter, Facebook, and LinkedIn, or sign up for his daily newsletter.

Underwritten by

Elliott Advocacy is underwritten by AirportParkingReservations.com

With nearly 20 years in the industry, over 128 airport covered in the U.S. and Canada, and over 1,000 Hotel and Parking Partners-we provide travelers the best options on how to get to the airport when flying. Whether you want to; drive yourself and park near an Airport (Airport Parking), stay the night before your flight at an airport hotel and leave your car (Hotel and Parking Package), or take a shared Shuttle/Private Car/Limo to the Airport- we got you covered. The best deals can be found online, and booking a reservation has never been easier. You can explore all of our options by visiting us at AirportParkingReservations.com, ParkSleepFly.com, AirportParking.com, and ShuttleFinder.com.

Elliott Advocacy is underwritten by Generali Global Assistance

Generali Global Assistance has been a leading provider of travel insurance and other assistance services for more than 25 years. We offer a full suite of innovative, vertically integrated travel insurance and emergency services. Generali Global Assistance is part of The Europ Assistance (EA) Group, who pioneered the travel assistance industry in 1963 and continues to be the leader in providing real-time assistance anywhere in the world, delivering on our motto – You Live, We Care.

Elliott Advocacy is underwritten by Seven Corners

Seven Corners has helped customers all over the world with travel difficulties, big and small. As one of the few remaining privately owned travel insurance companies, Seven Corners provides insurance plans and 24/7 travel assistance services to more than a million people each year. Because we’re privately held, we can focus on the customer without the constraints that larger companies have. Visit Seven Corners to learn more.

Elliott Advocacy is underwritten by Sodexo North America

Sodexo North America Sodexo North America is part of a global, Fortune 500 company with a presence in 80 countries. Sodexo is a leading provider of integrated food, facilities management and other services that enhance organizational performance, contribute to local communities and improve quality of life for millions of customers in corporate, education, healthcare, senior living, sports and leisure, government and other environments daily. Learn more at Sodexoinsights.com.

Elliott Advocacy is underwritten by Travelex Insurance Services

Travelex Insurance Services is a leading travel insurance provider in the United States with over 55 years combined industry expertise of helping people dream, explore and travel with confidence. We offer comprehensive travel insurance plans with optional upgrades allowing travelers to customize the plans to fit their needs. Compare plans, get a quote and buy online at Travelexinsurance.com.

Elliott Advocacy is underwritten by Allianz Travel Insurance

The Allianz Travel Insurance company has built its reputation on partnering with agents all around the world to provide comprehensive travel insurance for their clients. Contact Allianz Travel Insurance for a comprehensive list of coverage.

Elliott Advocacy is underwritten by Chubb

Chubb is the world’s largest publicly traded property and casualty insurance company, and recognized as the premier provider of insurance for successful individuals and families in the U.S. and selected international markets, offering coverage for high-value automobile, homeowners, recreational marine/aviation, valuables and umbrella liability coverage. As an underwriting company, Chubb assesses, assumes and manages risk with insight and discipline, and combines the precision of craftsmanship with decades of experience to conceive, craft and deliver the best insurance coverage and services to individuals, families and business of all size.

Elliott Advocacy is underwritten by Fareportal

Fareportal’s portfolio of brands, which include  CheapOair and  OneTravel, are dedicated to helping customers enjoy their trip. Whether you want to call, click, or use one of our travel apps, one thing is clear: We make it easy to take it easy.

Elliott Advocacy is underwritten by Insuremyrentalcar.com

An independent provider of low cost CDW/LDW insurance for use with rental cars. Up to $100,000 cover with no deductible. Policies available on a per day, per trip or per year basis. Also works with overseas rentals. Try  Insuremyrentalcar.comnow.

Elliott Advocacy is underwritten by Mediacom Communications

The nation’s fifth-largest cable operator, serving the smaller cities and towns in the Midwest and Southern regions of the United States. We are a high-performance broadband, entertainment, and communications company that brings the power of modern technology and quality customer experience to life inside the connected home by combining ultra-fast gigabit speeds with personalized local and over-the-top entertainment choices that fit your lifestyle. Details at  Mediacomcable.com.

Elliott Advocacy is underwritten by Arch RoamRight

Arch RoamRight is one of the fastest growing, most-highly rated travel insurance companies in the United States. Travel advisors love working with us, and travelers feel protected with our trip cancellation and travel medical insurance coverage. We also make it easy to file a claim online with our fast, paperless claims website. Learn more about RoamRight travel insurance.

Elliott Advocacy is underwritten by Virtuoso

The leading global network for luxury and experiential travel. This invitation-only organization comprises over 1,000 travel agency locations with 17,500 advisors in over 45 countries, and holds preferred relationships with 1,700 of the world’s finest travel companies. Virtuoso advisors collaborate with their clients to create personalized itineraries featuring exclusive perks, while also providing advice, access, advocacy, and accountability. For more information, visit  Virtuoso.com.

Elliott Advocacy is underwritten by VisitorsCoverage

VisitorsCoverage is one of the world’s most trusted providers of travel insurance for millions of global travelers in over 175 countries. Working with top-rated travel insurance partner providers, VisitorsCoverage’s award-winning search, compare and purchase technology simplifies the travel insurance process and finds the best deals for the coverage you need to explore the world with confidence. Get insurance for your next trip at VisitorsCoverage.

Elliott Advocacy is underwritten by MedjetAssist

Medjet is the premier global air-medical transport, travel security and crisis response membership program for travelers. With a MedjetAssist membership, if you become hospitalized more than 150 miles from home, we will get you from that unfamiliar hospital all the way home to the hospital you trust. All you ever pay is your membership fee. MedjetHorizon members add 24/7 personal security and crisis response benefits. Elliott.org readers enjoy discounted rates. Travel safer with  MedjetAssist.

Elliott Advocacy is underwritten by Southwest Airlines

The mission of Southwest Airlines is dedication to the highest quality of Customer Service delivered with a sense of warmth, friendliness, individual pride, and Company Spirit. We are committed to provide our Employees a stable work environment with equal opportunity for learning and personal growth.

Elliott Advocacy is underwritten by TravelInsurance.com

TravelInsurance.com makes it fast and easy to compare and buy travel insurance online from top rated providers. Our unbiased comparison engine allows travelers to read reviews, compare pricing and benefits and buy the right policy with a price guarantee, every time. Compare and buy travel insurance now at  TravelInsurance.com.

Elliott Advocacy is underwritten by Squaremouth

Squaremouth helps travelers easily and instantly compare travel insurance policies from all major providers. Only companies that meet the strict requirements of Squaremouth’s Zero Complaint Guarantee are available on the website. Compare policies on  Squaremouth.com to save over 70 percent on your next purchase.

Elliott Advocacy is underwritten by Travel Leaders Group

Travel Leaders Group is transforming travel through its progressive approach toward each unique travel experience. Travel Leaders Group assists millions of travelers through its leisure, business and network travel operations under a variety of diversified divisions and brands including All Aboard Travel, Andrew Harper Travel, Colletts Travel, Corporate Travel Services, CruCon Cruise Outlet, Cruise Specialists, Nexion, Protravel International, SinglesCruise.com, Travel Leaders Corporate, Travel Leaders Network and Tzell Travel Group, and its merger with ALTOUR. With more than 7,000 agency locations and 52,000 travel advisors, Travel Leaders Group ranks as one of the industry’s largest retail travel agency companies.

Elliott Advocacy is underwritten by Travelers United

If you’ve been mistreated by the airlines, Travelers United is your voice in Washington. Join the #1 travel advocacy organization working with Congress to improve and protect travelers. Plus, get $400 of annual benefits you can use for travel for only $29/year. Add your voice to ours. Make travel better.  Join today.

Elliott Advocacy is underwritten by Generali Global Assistance

Generali Global Assistance has been a leading provider of travel insurance and other assistance services for more than 25 years. We offer a full suite of innovative, vertically integrated travel insurance and emergency services. Generali Global Assistance is part of The Europ Assistance (EA) Group, who pioneered the travel assistance industry in 1963 and continues to be the leader in providing real-time assistance anywhere in the world, delivering on our motto – You Live, We Care.

%d bloggers like this: