Unintended consequences: Delta's new rewards plan

  • Article by: MARK WEBER
  • Updated: March 14, 2014 - 5:59 PM

There’s no advantage for individuals to book early, which could cost businesses.

hide

Photo: GLEN STUBBE • Star Tribune,

CameraStar Tribune photo galleries

Cameraview larger

There is no doubt the shift in awarding travel points based on ticket price instead of miles flown makes good business sense (“Rewards plan at Delta never made much sense,” Lee Schafer, March 5). Encouraging the biggest group of customers to spend more, especially if they aren’t the ones paying, will do wonders for corporate profits. There are however, negative behavioral changes that are inevitable, which the column failed to mention.

The Delta spokesman reasoned why the business traveler who paid $750 for his ticket should get “something more for their experience” than the leisure flier sitting next to him who planned ahead and paid only $200. What he failed to mention was that in all probability the business traveler incurred no personal out-of-pocket cost, while the leisure traveler paid for a ticket with his or her own money. One has to look no further than the current state of America’s health care system to see how advantageous it is for a business or industry when the end user is not directly paying for the product or service they receive.

Many business trips cannot be booked weeks in advance, but many can. What incentive does a businessperson have to book a trip sooner at a lower fare rather than later other than to be a good corporate citizen? Waiting until a few days before departure to buy the higher-priced ticket will not only earn many more frequent-flier points, but based on changes Delta made last year, it will give the buyer a better preferred status, earning points at an even higher rate and improving the chances of an upgrade to first class.

The column raised the question of what took Delta so long to make this change. A decade ago, these changes would have been far more difficult. At that time there were seven or eight major U.S. airlines, and consumers could always depend on one of them to respond with a less-than-prudent bottom-line decision that made it far more difficult for such changes to stick. With airline consolidation, only two other global U.S. carriers remain, and chances are good they will both follow Delta’s lead.

The big losers, of course, are small businesses and the semi-frequent leisure traveler. Such is life. But everyone, especially companies with high travel costs, will also be adversely affected. Corporate airline expense will increase and, more sadly, traveling employees will become less ethical.

Mark Weber lives in Minneapolis.

  • get related content delivered to your inbox

  • manage my email subscriptions

ADVERTISEMENT

  • about opinion

  • The Opinion section is produced by the Editorial Department to foster discussion about key issues. The Editorial Board represents the institutional voice of the Star Tribune and operates independently of the newsroom.

  • Submit a letter or commentary
Connect with twitterConnect with facebookConnect with Google+Connect with PinterestConnect with PinterestConnect with RssfeedConnect with email newsletters

ADVERTISEMENT

ADVERTISEMENT

ADVERTISEMENT

Question of the Day

Poll: Do you support or oppose US airstrikes in Iraq?

Weekly Question
 
Close