Are travelers giving up on loyalty programs?

Shutterstock

It’s finally happening.

After years of putting up with blackout dates, broken promises and bait-and-switch games, American travelers — particularly air travelers — are saying “Enough!”

They’re refusing to play the loyalty-program game, jettisoning blind brand allegiance in favor of a more pragmatic view of travel. Price and convenience are trumping mindless devotion to an airline, a car rental company or a hotel.

In a recent survey, a plurality of travelers (38 percent) said that finding the best deal topped their list, a tectonic shift from previous years, when collecting credits in a frequent-flier or frequent-stayer program was more important. Only 9 percent of travelers will book their trips based on loyalty to an airline or hotel chain, according to the poll conducted by Wakefield Research on behalf of Capital One.

“It’s all about the bottom line,” says Nathan Richter, a partner at Wakefield Research. “Getting the best deal on a summer vacation is a priority for many consumers this year.”

Consumers in the past have been willing to endure the fine print and shifting goal posts that have defined most travel loyalty programs. They’ve looked the other way while program rules were quietly rewritten and their points expired, hopeful that they would someday get a “free” award ticket. But the latest reforms by such legacy airlines as Delta and United, which tied rewards to the amount that travelers spend rather than the number of points they earn, was a pill too hard to swallow.

So travelers are quitting.

April Thompson, a digital marketing consultant based in Atlanta, has been a loyal Delta SkyMiles member since she graduated from college in 2004. She discovered the value of accumulating miles and redeeming them through the airline’s expanding network of global partners — until the carrier decided to change the way it measured her loyalty, rewarding her based in part on how much she spends, instead of how much she flies. Those SkyMiles revisions, announced in February, will take effect on all flights departing after Jan. 1, 2015.

“I will definitely be loosening up my allegiance to Delta,” she says. “Value and convenience are now my top priorities.”

Thompson has already allowed her elite membership to lapse, slipping from platinum level to gold, and she’s shifting her spending to an American Express card that allows her to redeem her rewards on multiple airlines so that she’s no longer tied to Delta.

“Buh-bye,” says Jim Dailakis, a New York-based actor, who says he’s ditching his United loyalty program. “I no longer see the point in being loyal to any of these airlines and their mediocre rewards. They’re like a partner who only wants to stay with you because you have a lot of money. I’m dumping them just like I would a materialistic girlfriend.”

United’s changes, announced in June, take effect next March and mirror Delta’s changes, rewarding customers based on the fare paid rather than the number of miles flown. The biggest losers will be leisure travelers, says Brian Karimzad, director of the loyalty program site MileCards.com. “With average airfare around $300, you’ll earn fewer miles for that fare,” he says.

Ray Advani, founder of the money management blog Squirrelers.com, has watched the massive devaluation of loyalty programs and says that consumers’ behavioral changes make sense: It’s as if American travelers are slowly waking up from a three-decade slumber and realizing that the loyalty only ever went one way. Advani, who views this development as a consumer finance expert and a traveler, says that he’s changed the way he flies, too. “I’ve decided to focus on the actual prices rather than the rewards program when spending,” he says.

Most of these loyalty program breakups happen quietly, from the privacy of an office cubicle or a home study. But not all of them. Consider what happened to Ron Hingst, who works for a nonprofit agency in Brighton, Mich., and is an enthusiastic participant in La Quinta Inn & Suites’ Returns loyalty program. “When I travel on business, I usually stay near the airport, and there is usually a La Quinta there,” he says.

But on a recent stay, when he proudly presented his loyalty card at the desk, an employee delivered a little bad news: Because he’d found a discounted rate online, it didn’t qualify for points. “Silly me,” he says. “I’m trying to be loyal, and now we split hairs where you book.”

Hingst cut up the card right then and there.

The few remaining loyalty program fans have a ready answer for people like Hingst. Go ahead, they say. Throw out your card. That just means more “free” rooms and tickets for us. But their responses suggest that these holdouts are missing an unsettling truth: that they’re witnessing the end of loyalty programs as they know them. It’s an event that even their platinum cards are unlikely to survive unscathed.

It might be a positive change. If enough travelers can break the loyalty habit, then the corrosive effects of loyalty programs on the travel industry could be reversed. People will spend because they see real value, not because they’re slaves to their gold cards and perks. In time, the division between “haves” and “have-nots” might even narrow, and perhaps all passengers will get decent service, regardless of the color of their loyalty card.

As we move closer to the end of the year, expect more program breakups as travelers realize that their loyalty program never was, and never will be, loyal to them.

Too bad it’s taken so long.

Are loyalty programs a scam?

View Results

Loading ... Loading ...

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 Cavalry Travel Insurance

Cavalry takes the worry of out travel by providing 24/7 access to medical and security professionals combined with the best medical evacuation and security extraction services. Cavalry gets you home safely when you need it most. Learn more at Cavalrytravelinsurance.com.

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 AirHelp

AirHelp is the world’s leading flight delays compensation company, helping passengers apply for compensation following a delayed or canceled flight or when boarding has been denied. It is AirHelp’s mission to fight for passenger rights by holding airlines accountable for flights disruptions that are out of passengers’ control. AirHelp has already helped 5 million people, taking the stress out of applying for compensation and making it as hassle-free as possible for travelers around the world.

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 G1G.com

Since its inception over three decades ago, G1G has continued to revolutionize the travel insurance industry by being the only aggregator to operate a customer portal, placing all of the user's primary needs in one place. We have continued to innovate and disrupt the market by reimagining the way travel insurance can be delivered to the end user in ways no competition can. Simply put, no one knows the market as well as its founders and no one else shares G1G values and mission.

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

As a company that is constantly striving to simplify travel insurance, VisitorsCoverage, is on a mission to help travelers make the better decisions about purchasing travel insurance, quickly. VisitorsCoverage has helped millions of travelers globally to buy the suitable travel insurance and explore the world with confidence. Get insurance for your next trip at  VisitorsCoverage. Lowest Price Guaranteed.

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.

Send this to a friend