Delta’s $DAL Q4-16 Investors day yields even MORE bad news for SkyMiles (but not Medallions)!

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Slide from DAL investors day presentation.

Let me start with the good news. AMEX continues to be a HUGE profit center for Delta. Some of the things the top brass at Delta talked about were “highest margins” and such. They love the relationship with AMEX. They also differentiated “frequent flyers” and that to me means elite points and SkyMiles and rightly so as they are not the same at all. To me I breathed a sigh of relief as I don’t think they are going to monkey with the Medallion program for now as it is lucrative and working well. At least that is what I hope is the case from what was said.

Now SkyMiles is another matter. The slide above, provided by Delta, to me screams how Delta just cannot be trusted to do anything but try to extract your SkyMiles at horrid value. Now don’t get me wrong I do not have any ill will against Delta for doing this as if anyone is dumb enough to fall for these, “more ways to burn miles” as Delta President Glen Hauenstein said, they deserve to see them go bye-bye. I, however, am not that dumb and nor should you be. Let’s break down this “slide of stupidity”:

  • Upgrade. We know they can cost as much as a LEVEL 1 ticket so why would you do this? Why pay money AND as many points as a ticket? Just crazy. Then again, hiding the award AND the upgrade charts makes this simpler to pull off.
  • Sky Club passes / membership. You are getting ~1 cent in value. Not horrid but there are FAR better ways to get into the Sky Club that give MORE perks back like the Delta Reserve card that not only gets you in but helps you score more upgrades, a BOGOF cert in 1st class each year and more. A much better value.
  • SkyMiles Experience. Most times way too many points for the value you get back (well most times that is anyway). SPG Moments does it right and is a much better choice if you want a neat experience.
  • Enhanced food and beverages in Sky Clubs. Does not ANYONE at the airlines get we HATE the word “enhanced” anything? OK a side point but dumping your SkyMiles to pay for food or drink in Sky Clubs is just ridiculous and anyone who even thinks about doing this needs to be sedated. Let’s move on.
  • Spa services. Really? Tell ya what, go out of the club and find an XpresSpa. They are cheaper, and they let you pay with a points card AND they have a loyalty rewards program. Don’t over pay and get little value out of your SkyMiles this way.
  • Delta Private Jets. BUUHAHHAHAHA ! If you really want to empty your SkyMiles account in one flight of a few hours, you go right ahead! Ridiculous. Remember when we were promised we could as elite “upgrade” to these flights. 😉

Oh but Delta is not done yet. The list of insanity above we are learning is just the beginning. Delta is coming up with MORE ways to fleece you of your SkyMiles. Look at what enhancements (see what I did there) are on the way next year:

  • Change fees. First off, if you are paying change fees, you are already in trouble. There are SOOOOOO many ways to get out of these. Please don’t compound your error by making another error by burning SkyMiles to pay for this fee. You will be sick for paying and sick when you realize you have lost even more value dumping points.
  • Onboard Wi-Fi. So we are talking Gogo here. Yes Gogo is needed. We don’t know if this means you can pay on the ground (or get them free) or in the air because if only in the air then those Gogo prices are sick nasty high compared to pre-paid passes. Either way my guess is we will be talking 1 cent value per SkyMile and that is the bottom floor. So maybe this is just barely OK in a pinch. But what if this spend means you end up just short of the miles needed for a trip? Not good.
  • Unaccompanied minor fees. Let me think. You can pay with just about any card and earn points for the fee. Or, you can likely burn SkyMiles at 1 cent each that again is the bottom floor value of a SkyMile. Hummm…. Folks these are not hard are they?
  • Pet charges. I will not dive into the whole fake or real emotional support animal issue, but I personally feel how much Delta charges to bring a pet onboard is shameful. Either way, like the two above, I bet we see a 1 cent per mile burn value. Woof woof (means in dogspeak, “don’t do it” btw).

Yes Delta you are truly coming up with more ways to burn miles than just to buy tickets. However, unless you start offering us 2 or 3 cents in value per SkyMile I am just not going to fall for these or any other creative ways to extract my hard earned points.

Lastly, when it does come to spending your SkyMiles, take the time to learn how to always find LEVEL 1 coach or business class awards by reading the E7 posts. Overspending SkyMiles on awards or on the things above is NOT winning. If you need help, please consider reaching out to ADAM to help you extract value from your points rather than the other way around! – René

 


DISCLAIMER: I never ever buy or sell any airline stock including DAL.

 

3 comments

  1. I would rather Delta find creative ways for the uninformed and infrequent traveler (who doesn’t collect enough miles for a RT ticket) to spend their miles on low return items like Sky Club purchases or wifi than to change the flight redemption program into a revenue based program ($.01/$1).

    Clearly they need to find away to limit their liability in the amount of skymiles out there and I think this is a reasonable way of going about it. Additionally, those with infrequent travelers 10-15k skymiles in the bank feel they are getting value for their money when they buy overpriced vodka in a Sky Club.

    I do not foresee Delta changing to a revenue-based redemption program because it will kill the Delta Amex usage. The allure of using a DL Amex (or other airline credit card) is that you can have a return greater than 1%, if they cap it at 1%, customers will leave that ecosystem and move to a cash back or other reward program.

  2. I depend on the AMEX Reserve MQMs each year to maintain status. Whatever Delta does to the value of skymiles is irrelevant to me, since the real value to me in spending on my delta AMEX is the MQMs. I’m not in love with the changes they have made, but if I want those MQMs, I have no other choice.

  3. I switched to AA, because quite simply, I don’t want Amex. If you aren’t using Amex, Delta is very hard to do business with anymore. (At least from a FF perspective)

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