Making the Most Out of (Devaluing?) Membership Rewards Points

Ronald A. asks how to get the most out of Membership Rewards points, in light of recent changes to their program — no more bonus to pay for airline tickets directly with points (which was never a good value to begin with), fewer transfer bonuses in the past, and partners that mostly add fuel surcharges onto awards. They’ve also eliminated their shopping portal that allowed accumulation of Membership Rewards points for online purchases.

I’ve written frequently in the past that the biggest devaluations to Membership Rewards have come from external changes rather than changes to Membership Rewards itself —

  • Aeroplan gutting its award chart and adding furcharges to most partners
  • British Airways gutting its award chart for long haul/connections
  • ANA adding fuel surcharges onto Virgin Atlantic awards
  • Singapore Airlines increasing award chart pricing
  • Loss of Continental as a transfer partner (due to their merger with United and Chase’s sway at that latter carrier)

At the same time they must be feeling constrained in what they can do to combat this, having taken a charge of more than $300 million for higher than anticipated costs associated with redeeming awards.

Still, it’s the partners they happen to have in the current program that lead to the biggest limitations i value. American Express has mostly foreign points transfer partnerships, and most foreign airlines add fuel surcharges.

Delta isn’t as bad with fuel surcharges as they used to be, eg they stopped charging them on Virgin Australia redemptions.

And oddly Air France’s Flying Blue doesn’t charge them on Delta redemptions (of course the constraint here is award space).

British Airways Avios is a decent use for short non-stop flights. US-South America has no fuel surcharges, East Coast to most of South America is 50,000 points each way in business. When there are transfer bonuses that’s awesome.

I love Singapore Airlines transfers because of the world of availability that exists for Singapore’s own premium cabin, but that they don’t make available to their partners. I’ve written in the past that it’s possible to grab two first class award seats to Singapore just about every single day! You do pay fuel surcharges, but I consider that worth it for Singapore first class. They don’t really do transfer bonuses though.

There are some gems in the Alitalia award chart such as:

  • North America-North Asia 90,000 miles roundtrip in business
  • North America-Southeast Asia 95,000 miles roundtrip in business
  • North America-India 100,000 miles roundtrip in business
  • North America-Southern South America 75,000 miles roundtrip in business
  • North America-Tahiti 90,000 miles roundtrip in business

And Alitalia does offer a double miles option to redeem for most seats on its own metal, something few non-US programs do or charge even more for (Air France limits premium cabin double miles redemptions to their own elites, BA doesn’t offer it, Singapore requires too many miles for it).

And there are strategic uses for Delta miles, if I want to go to Australia or Tahiti it’s the program I look to. If I want to get a family of four to India in a premium cabin from New York or DC it’s the program I look to (and there are no fuel surcharges on Saudia). When it isn’t a Korea Air blackout date (on ANY route in their system) then availability from SOME U.S. gateway can usually be found.

I do like Ultimate Rewards the most these days because of the flexibility to transfer to United (great for business class awards, much harder to get awards in first — though Asiana has seats when it’s not a blackout for them, Thai has seats) as well as British Airways (like Membership Rewards) and especially Korean (fuel surcharges, but amazing availability, and you can’t use Delta miles to get into their first class cabin which preserves those seats for Chase cardmembers and Korean’s own members for the most part — that’s how I grabbed one-stop back from Malaysia on Korean for the Sunday after Thanksgiving even).

Oddly enough I cherish my Membership Rewards and Ultimate Rewards points more than my Starwood points, even though Starwood has more transfer partners and a built in 25% transfer bonus (5000 bonus miles for each 20,000 transferred) because of the speed with which points transfer — several partners are ‘live’ (instant, you can set an award up on the phone with an agent, hit transfer online, and they see the points in your account instantly) and others transfer in a day or two like Singapore. Starwood points can take several days to weeks to show up in a mileage account, with the risk of award space being lost by the time they do.

It’s that speed and especially the ability to transfer to Singapore that keeps me loyal to Membership Rewards.

But the program does risk alienating customers, death by a thousand cuts, as much or more from the changes made by their partners are by reductions in the programs own generosity such as transfer bonuses. Most of the new programs added in recent times have had limited utility, and losses of Continental (and Southwest and Marriott etc) ultimately hurt a lot.

About Gary Leff

Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel - a topic he has covered since 2002. Co-founder of frequent flyer community InsideFlyer.com, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

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Comments

  1. Don’t you think it’s a bit strange how everything is hanging by a thread?
    If you want aspirational redemptions, then all you need is UA to start charging YQ, and then everything will go kaput.
    And given the upcoming aa/us deval, it’s just getting worse.
    Sort of like AP.

  2. @Andy I don’t see it that way at all. United doesn’t get you first class on SQ, NH very much of the time, LX, LH until 14 days from departure at the earliest. UA is great for business class, and first class on Thai, Asiana (when they don’t have blackout dates, on those few routes with first), its own metal (if you can call that first class), and Air China.

    I think Singapore even with fuel surcharges is great for aspirational awards. I still expect to see American miles as good for aspirational awards on Cathay et al. And we have new options to redeem for Emirates first class (A380 with showers, and they don’t add fuel surcharges).

  3. @DrNo ‘international origination surcharge’ aka “because your home country airline does so we can stick it to you, too’

  4. It’s nice that Asia has so many options, but many of just want to to go to Italy or secondary cities in Europe, and it’s getting almost impossible to find a pair of non-stop business seats (even from NYC) for points. When they are available it’s almost always double point awards (except London, where it’s just high fees to contend with). I’m deep into Membership Rewards, but haven’t found the great partners to transfer too. Already have some miles rotting with Delta and Aeroplan.

  5. Points are only worth what you value them at. I feel that being educated has made my miles more valuable than ever. I see that totally depends on what you need to use them for. For me, I don’t fly for a living or even that often (only 3 trips this year). However, I was able to book Upper Class for my wife and I on VS for 136,000 MR points through ANA. All of those points were from sign up bonuses (AMEX PLAT and Business RP Gold). I did have to pay the tax on the fights, which was steep. However we were going on this trip anyway and the taxes were less than the cost of the lowest airfare in coach. So in my view I’m paying the miles, which only cost me the fee for the card, for a upgrade which would have cost me $8000. Which BTW I never would have paid by myself. Now if I was looking for the ability to transfer miles for flights on many carriers worldwide with low fees and good availability, then I might feel different. For me I’m going to enjoy what I can still get. YMMV

  6. Gary, above on Aeroplan, how much do the “furcharges” you mention usually run, as I often travel with my mink coat onboard?

  7. The biggest MR devalution in my eyes is the loss of all those wonderful xfer to Delta bonuses of 30, 40, and even 50%. I’ve had the Amex Gold Business for 17 years (!), but for what it costs now, and the number of points I earn….I’m not renewing. I can do better with Chase UR.

  8. Gary: can you say more about the Alitalia double miles option? I’ m not familiar with it and wasn’t clear on what that means. Thank you.

  9. I still work for a living M-F so being able to book far ahead for an aspirational vacation is very important………and I have miles parked on AA, BA, UA, US Air and Membership Rewards….(UR coming)………and without a doubt and not even close was the award availability on BA for a May-June trip SFO-LHR-Lyon, Nice-LHR-SFO………their First Class choices were plentiful at the 300-330 days out and despite the $900 surcharge per ticket I have to say that being able to actually use the miles is worth the surcharge…….add to that that only 168k was needed because of the VISA companion ticket from credit charge usage………so if there is another program that beats that deal and AVAILABILITY then I’d love to see it……..

  10. I currently have a personal Platinum card (it’s my only MR card), if I get approved for the business Gold card and link it to my existing MR account and then close my personal Platinum, my existing MR points will be safe, correct? Just want to be sure as its my first time doing the transition and I don’t want to lose my current ~100k MR points.

  11. Chase Ultimate Rewards is going to overtake Amex Membership Rewards and leave it in the dust.

  12. @nsx

    Going to? They are already there. If it wasn’t for ANA, I’m not sure I’d have anything to do with them anymore.

  13. In all that gloom and doom Membership Rewards devaluation news you forgot to look at the bright side – American Express still offers free Financial Reviews!

  14. I am planning a trip for 2 to the Philippines in about 6 weeks, I have 350,000 american express rewards points, how do I get the most bang for my points for the flight.

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