All You Need To Know About Frequent Flyer Privilege

The world of travel changed when the first frequent flyer privilege program was introduced in 1979. Back then, frequent flyer privilege programs were quite simple: take a few flights to earn a free flight. Fast forward 40 years later, you can earn discounts on airline tickets and redeem points to earn free car rentals, hotel stays, magazines, and much more! If you play your cards right and choose the right program, you can get much value from a frequent flyer privilege program. Here are some interesting facts you didn’t know about frequent flyer privileges.

1. Some flyers used to take longer flights just to earn more airline miles
   Previously, the system to earn airline miles was based purely on the number of flights flown. So, to exploit this system, flyers used to take multi-stop flights that used to take longer. But they were also cheaper. Imagine spending less to earn more airline miles!
   To resolve this, airlines were left with no alternative but to change their frequent flyer program from miles-based to spend-based. You now earn airline miles based on the actual money you spend.

2. Airlines earn a lot more through their frequent flyer programs than through ticket sales
   Airlines partner with many travel and non-travel companies to attract new customers and retain old customers. Car rentals, cruise companies, hotels, and retail outlet businesses buy points from the airlines and grant those to their customers as a reward for making transactions.
   The airlines also have strategic partnerships with financial organizations that issue credit and debit cards. These organizations let members earn points using co-branded credit and debit cards. So, the airlines make real money by selling virtual points!

3. The loyalty programs of some airlines are worth more than the airline’s market value
   American Airlines Advantage program is worth $37.6 billion, while its market value is just $21.2 billion. Similarly, United’s MileagePlus is worth approximately $28.7 billion, while its market value is $21.3 billion. These numbers show the value of loyalty programs to airlines. In fact, American Airlines used AAdvantage as collateral to get a federal loan during the COVID-19 crisis.

4. Airlines want you to earn a credit card welcome bonus
   When you get a bonus for signing up for a credit card, the partner bank that issued the credit card has to buy more miles from the airlines. This generates cash flow for the airlines and records some of the mileage sales as a profit. You couldn’t care less as long as you get the airline miles, right?

5. You can collect a points fortune without ever setting foot on a plane
   You can earn points simply by using credit and debit cards from organizations partnered with an airline. Since not all these partner organizations are travel businesses, building an airline miles fortune is possible without taking a single flight. Although this is possible, the G.O.A.T. frequent flyer has built his points fortune solely by taking flights.

6. The most frequent flyer has flown more than 22 million miles
   Tom Stuker has been flying with United Airlines since 1984. Tom completed a challenge to fly all 50 states within 50 days back in 1984, which earned him a free year of first-class travel. But that was just the beginning. He has flown from New York to Sydney more than three hundred times! He travels to Hawaii every three months. He has flown all the routes of United Airlines and has flown with all of its partner airlines.
   Since retiring, he’s been flying even more! Tom has spent all the points he’s earned to buy gift cards for others. The secret behind his extraordinary record? His desire to always be in the air as he’s “more afraid of being on the ground than being in the air.”

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