Many airline (and some hotel) loyalty programs offer rebates for the online shopping purchases you’d make anyway, as long as you start of your searching through their shopping portal.
That’s because the merchants you buy from will often pay a commission on the sales they make. And these shopping portals induce you to use their link, so they get the commissions, by rebating a portion of that commission to you in the form of miles and points.
There are shopping portals offered, for instasnce, by Delta, United, US Airways and American Airlines. There are shopping portals from Hilton and Priority Club. American Express used to have such a portal, but I find most frequently that the one I use is the Chase Ultimate Rewards Mall… very often the best earning rates (although not always), and certainly some of the most valuable points you can receive (since they’re transferrable to several airline and hotel loyalty programs).
How Do You Figure Out What Offers Exist?
First of all you don’t have to go to each program’s shopping site to figure out what’s being offered. That’s because there are metasearch sites that catalogue the dfferent offers from places like the AAdvantage shopping mall, from BigCrumbs, and from the Mileage Plus mall and make them easily searchable.
None of them are perfect, or give you every option (or are perfectly up to date) every time. But they serve a very useful purpose of giving you a quick and convenient rundown of the different rewards being offered for the store you’re going to purchase from. And some even give you special deals and coupons as well.
You search the merchant you’re going to buy from, say Sears or Target, and get a list of offers from the various sites as well as usually a convenient link to the page you need to start from to earn the rebate.
Once You Know What Rebates are Offered, How Do You Choose?
My first rule of thumb is that hotel portals rarely offer the best deal, I can almost always just ignore whatever options are presented by Hilton or Choice Privileges. I’ve rarely seen any hotel shopping portal make the most compelling offer.
Usually I’m forced to decide between earning airline miles and earning cash back. Choosing which cash back portal is generally easy, you pick the one with the highest rate of return But how do you decide between cash and earning points?
The approach I use is to multiply the number of airline miles per dollar being offered by 1.5 to compare miles and cash back. That means if I choose miles, I’m effectively buying them at 1.5 cents apiece (the rate of cash back I’m giving up if the two are equal). If I can get 4 American miles, I’d need cash back to be 6% or higher in order to choose cash. If I can get 6 American miles, I’d take a 10% cash back since 10 > 9. The multiplier you should use is the rate at which you’d willingly buy miles.
But if you’re going to earn airline miles, how do you decide whose to earn?
My first question is whether I’m trying to extend the life of a mileage account that is getting close to expiration from inactivity. That makes the choice a no-brainer, a small online purchase can push out mileage expiration with many programs.
Otherwise I’m just going with the highest mileage offer between the major U.S. airline programs (United, US Airways, American) with the caveat that Delta needs to be at least a 40% higher return than those three other airlines before I’ll consider it, because Delta miles tend to be the hardest to use with their awards priced most expensively (not all the time, they’re best especially for Australia).
And I’m willing to take about 20% fewer points (say, 4 points rather than 5) from the Chase Ultimate Rewards Mall because the points you earn have greater value as a result of the flexibility to move them to several different airline and hotel programs.
How Reliable are the Online Shopping Portals?
I view these rebates as free money or free miles, rewards for purchases I’m going to make anyway. I don’t spend more money to get these rewards, because shopping portals have a history of issues reliably posting points. In my experience things work smoothly most of the time, but the amounts tend to be small and so hard to track. And when things go awry, customer service tends not to be their forte.
The one exception to that rule about customer service is the Chase Ultimate Rewards Mall, where their agents are often willing to post missing points that you report, and you can deal with a live person by phone or deal with someone via secure messaging and get a response..
Chase aside, it can be hard to ‘chase’ down missing points because you’re not really dealing with your favorite mileage program, you’re actually dealing with a third party vendor who doesn’t want to pay you unless they’ve gotten paid from the merchant you made a purchase from.
They need to chase down the commission from the store, and then buy the miles to give to you. And spending any customer service time doing so is more costly than the amounts involved. So they don’t usually invest a ton in customer service.
These third party vendors, using the name of the mileage program, are actually just buying miles from that program to rebate a portion of their commission to you. And the airline doesn’t get paid for the miles if they just give them to you as a goodwill gesture, they have to chase down the vendor to verify the transaction (the details of which they have no access to).
All of the hands involved (online store, third party vendor, mileage program, you) create multiple failure points and the technology (mostly tracking cookies) is imperfect. Add in little incentive on anyone’s part to make things right and missing miles often stay missing.
Still, I find things work correctly on their own for me about 90% of the time so I tend not to worry about the other 10%. Free miles are free miles after all.