The Holy Grail for thrifty family vacation planners? Scoring a free flight or sweet upgrade. For the 300 million members of domestic airline frequent flyer programs, that means chasing airline miles and points.
It's interesting to understand how loyalty programs influence our travel decisions. Airline loyalty is far more fickle than hotel loyalty. Only 10 percent of travelers choose flights based on brand loyalty, according to a study by Fly.com, saying they would switch if a competitor offered savings of at least $51.
Given that airfares are usually determined by a cutthroat surge pricing model, only 7 percent of all miles flown are also paid for with miles, according to PricewaterhouseCoopers.
Best Travel Rewards Programs for Freebies & Perks
Once upon a time, miles were awarded based on distance traveled. But in the past six years, half of the major U.S. airlines have switched to spend based programs, which means that they now award miles to passengers based on the amount of money spent. All of these airlines have a tiered earning rate based on the fare class and status level thus benefiting passengers who spend more.
Best Airline Loyalty Programs
Don't have time to compare which airline loyalty programs are worth joining? US News & World Report has done the legwork for you. Its annual rankings identify 28 hotel and airline loyalty programs with the most rewarding perks. In its 2016 study, Alaska Airlines Mileage Plans topped the list for the Best Airlines Rewards Programs.
The top five programs are:
- Alaska Airlines Mileage Plans
- JetBlue TrueBlue
- Southwest Rapid Rewards
- Delta SkyMiles
- Virgin America Elevate
Alaska Airlines Mileage Plan rewards points based on the number of miles flown rather than dollars spent, making it easier for budget-conscious travelers to earn free flights on its vast partner network.
JetBlue TrueBlue followed at No. 2 because of its multiple ways to earn points, high airline quality performance and elite member perks such as free checked bags, priority boarding and expedited security.
CardHub Study: Best and Worst Loyalty Programs
The credit card comparison website CardHub's 2016 Frequent Flyer Study examined the rewards programs offered by the 10 largest domestic airlines based on 23 key metrics, such as the average value of a mile, mile expiration policies, and blackout dates. This study came up with a different pecking order than US News & World Report's study.
Expert Tips: Choosing Travel Rewards Programs
CardHub's report identified the best and worst airline rewards programs for three different flyer profiles based on money spent on air travel: Light ($467 per year), Moderate ($3,105 per year), and Heavy ($5,743 per year).
Want to fast forward to find the best loyalty program for your own family? The report also features a custom calculator that allows you to personalize the results based on your own air travel budget.
CardHub found that, for most families spending between $500 and $4,000 annually on air travel, the best airline rewards program is Delta Air Lines followed by Virgin America.
For heavy spenders, JetBlue Airways is the best airline rewards program, followed by Delta Air Lines.
Delta Air Lines and JetBlue Airways are the only two major airlines whose miles do not expire because of inactivity.
When you only consider the average redemption value of miles earned through each program, without taking into account any other important characteristics such as blackout dates and miles-expiration policies, Frontier, Hawaiian and Alaska are the best airlines for light, average and frequent flyers, respectively.
Spirit Airlines and Frontier Airlines miles expire after just three and six months of account inactivity, respectively. United Airlines, Alaska Airlines and Frontier Airlines are the only carriers that impose blackout dates for tickets purchased with miles.
Other key findings:
- The average airline earns a profit of 46.91% on the sale of miles to rewards program members, with Spirit (80.86%), Delta (65.96%) and Hawaiian (62.14%) making the most.
US News & World Report's travel rankings are based on an analysis of expert and user opinions for a mix of opinion and data, in an effort to make rankings more useful than simply providing editors' personal opinions.
CardHub compared the loyalty rewards programs based on number of airline companies, using publicly available information and company policies posted online. To score each program, most of the metrics were first graded on a 100-point scale. Generally, full points were awarded to the best-performing program for that metric, while the zero-point level was set slightly below the worst program’s result. Find more details here.