Three years ago Delta introduced minimum spending requirements for elite status. The revenue requirement was essentially set at 10 cents per mile — e.g. $2500 for 25,000 mile status, $5000 for 50,000 mile status and so on. That was a big conceptual move, but one with limited effect in practice.
- At current ticket prices, it’s hard to spend less than 10 cents a mile on average for tickets.
- They allowed members to spend $25,000 in a year on their co-brand credit cards to buy out of the requirement.
- It didn’t apply to members with registered addresses outside the US
A year ago Delta raised their minimum spend for status by 20% to 12 cents a mile a year ago.
American AAdvantage on the other hand announced program changes that do not include minimum spend to qualify for elite status (no matter what Dallas news anchors think).
Unlike Delta which lets you avoid spend requirements by living abroad or spending on their co-brand card, and unlike United which lets you avoid spend requirements for status up to Platinum those same ways, Aeroplan will not let members avoid the revenue minimums. One Mile at a Time points out that they are removing the 4 Air Canada flight minimum rule for earning their elite status.
As with other carriers taking a similar approach, only their own flights or ticket stock qualify. Technological limitations generally prevent an airline from seeing the revenue attached to segments they neither sold nor flew but which are credited to their loyalty program. They warn as well that they won’t see the revenue figures attached to some bulk fares.
What’s interesting about Air Canada’s move is that they’re setting revenue requirements for the 25,000; 35,000; 50,000; and 75,000 mile status levels at a minimum of ~ 12 Canadian cents per mile. United and Delta currently set their thresholds at 12 US cents per mile.
But Air Canada is setting their 100,000 mile status threshold at 20 Canadian cents per mile. At first blush that seems crazy and is clearly designed to thin their top tier ranks. As they’ve clearly said,
[W]e are not a charity. …It’s not a secret that we would prefer our customers sitting in the [business class] cabin to have paid for it.
And, as Delta has pointed out when everyone’s an elite flyer no one is. (That of course isn’t quite true, members compete for some benefits which are limited like first class upgrades while other benefits like waived bag fees are not competitive.)
Still, it’s not quite as out in left field a threshold as it might seem because the Canadian dollar is so weak. Delta’s top tier status requires US$15,000 in spend (though with fewer miles flown).
And of course there’s less full service airline competition in the Canadian market than there is in the U.S. Frequent flyers like to complain about industry consolidation here, but there’s still United and Delta and American on top of robust low cost carriers and Southwest, JetBlue, and Alaska. It’s far easier to consolidate flying with a single airline for Canadian travel than it is for US travel.