The Future of Miles and Points

Once there is a proven formula, the formula becomes broken.

This is true for airlines, blogs, miles and many other things. That’s because when everyone knows the magic formula, the formula stops working. It’s somehow bland and worthless, less novel, or spread too thin.

It’s why big public things will die, and why there will always be miles and points collectors doing crazy things. Why people will always innovate.

This is a “teach a man to fish” post.

For instance an airline innovating with a brand new way of doing a mileage program. In that case, I’ll give it to Delta. Delta is doing something new. Out of a freaking ton of airlines where you earn a mile per butt in the seat flown, Delta will be the only major airline earning based on dollars spent. This may actually attract a ton of business flyers who have bosses that spend way too much on tickets. It makes them stand out, it makes them different and unique.

However, if/when airlines copy Delta by going revenue based, it’s because Delta created a formula. And once everyone thinks it’s a formula, it’s dead. It’s no longer novel. There is no reason to fly United over Delta. And if every airline does it, there’s no reason to pick that airline over the others.

Same/same with miles.

Once everyone knows about the one-dollar coins, it’s dead. Right?

It’s not that it’s impossible to earn free miles. It’s just impossible for everyone to get free miles from it, because then it’s a broken system.

As soon as everyone knows about a fuel dumb, it’s dead.

As soon as everyone knows about anything that works in the user’s favor it’s dead. When a business creates any rewards program, runs a promo (like a BOGO) or whatever, they know that they may not come out ahead on a few, and they are fine with that. However, if a business is losing money on its promotion/program across the board, it’s dysfunctional and needs changed.

Proof

So I was just at the Ann Arbor Do listening to Tashir, who’s an incredibly clever kid, speak about manufactured spend. And on a break, my friend said to me “yea, I used to hit the ____ card really hard, but I’ve slowed down now.” He was talking about this gift card he discovered… that could liquidate… really easily. My guess is that he bought a ton of them. And when I say a ton, it could actually have been a ton.

Anyways, right after this friend tells me that he is slowing down with a certain card, the guys speaking get back up and pull up the next slide on the ____ card – the same card that this friend went freaking hard on and was now slowing down. And the speaker says, “I haven’t used this card much but I’m going to start.”

And I think that’s case in point. By the time this thing is big enough that it’s on the forums and public, some folks have already dried it up.

Although other times, people have something good going for years that no one knows about and then everyone else discovers it and it dies. The point at which it’s broken is different for everything, but for sure by the time the public knows, it’s in jeopardy.

And therefore everything is dying right?

Wrong.

Because airlines and the systems they create are broken, things will always change. But always for the better and worse.

Look at hotels, they have the exact same rewards programs. 10 points per dollar, categories of redemption, gold/plat/diamond status, etc… and to stand out, you have to do something different. Big promotions, new programs, etc… And whenever that happens, there will always be ways to win.

Furthermore, airlines have discovered more and more that selling miles is another revenue stream. And thus, things are always changing.

If every airline figures out how to have an anti mileage runner program, that system will be broken.

Innovation

Although, I’ve written a few times about innovation in this hobby.

I’m not worried about it, but I do think innovation is more valueable than ever. Relying on forums or blogs for ideas once worked. And it doesn’t anymore. The community is not as small as it used to be and it’s continuing to grow.

That’s not to say that there is no value in blogs or forums, because for most people, what is available is enough. But for those who got used to unlimited miles through another deal, blogs are not your friend.

Hopefully, I can still explain great redemptions. And along with that I want to explain the rules. People might prefer redemptions not the rules… but if you can understand why things work, you can understand what will and will not work.

It’s true with redemptions, MS, and many other situations. Knowing how things work, helps you figure out what works.

With earning any points…

So if you’re looking for MS advice, obviously Frequent Miler is the best blog out there. And I think seeing tactics over and over helps you understand concepts, but ultimately concept is king.

For this reason, I would love to read a post by him, not on tactics, but on theory. Might sound nerdy, but I mean explaining why things work. Also, what are the concepts when looking for a good MS? For example:

• Should be able to start small to test it.
• Should be able scale way up if it works.
• Should be able to liquidate in x days.

When earning I try to think about how to make it profitable. How can I add to the profit? How can I stack bonuses, or earn more?

Personally, I try to think of ways to earn from travel. This is why I love hotel and airline promotions… I’m going to travel anyways, so the process of earning is actually valuable in itself.

Idk…

But, for redemptions, I would say it’s more about why routes are allowed, than what routes are allowed. What’s the furthest you can take it, and why?

Sometimes, it’s really straight forward, like there is a max number of miles you can fly. And sometimes, the definition of an open-jaw is relative (like Delta). Unfortunately each airline is so different that the concepts are so specific. I’ve tried to write about reasonings, with United, ANA and more. And hopefully I’ll have a few more posts on interesting routes with new airlines soon… but there’s not a clear pattern for each program.

In general:

• What exactly are the routing/redemption limits in place?
• Why are the limits that are there in place?
• Are there exceptions?
• How are these limits enforced? or
• What happens when you go beyond the rules?
• What is the furthest you can stretch these limits?

Now when I look at a program, I don’t check list these. But I am curious, and end up saying to my self, “what happens when I?”, or “how do they define ___?”. How does an airline define stopover or open-jaw. What exactly does that mean?

I can’t tell you how many blog posts I’ve read that have the routing rules wrong or mis-explained. The real way to figure these things out is to: 1) read yourself the rules (assuming they exist) or, 2) test them out yourself.

Conclusion

Every time a door closes another opens up. Every time a site rebuilds, old glitches are gone and new ones are yet to be discovered. Yes, the community is bigger and things change quickly, but it will always favor those who get there first.

And that’s the question. Are you the type to follow or do it yourself?