Airline loyalty programs for small businesses
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For many business travelers, their company makes the decision to purchase tickets from one airline over another — so why not reward the company making the decision, in addition to awarding the traveler with frequent flyer miles? Earning the loyalty of a single business can result in tens of thousands of dollars a year in additional revenue for the airline. That’s the idea behind the business rewards programs operated by several airlines; they’re a great way for you and/or your company to double-dip on employee travel.
In today’s post, I want to take a closer look at three of the these programs to help you determine whether or not your company can benefit from them.
Business frequent flyer program basics
All three of the remaining U.S. legacy carriers offer a business rewards program for small- and medium-sized companies, although the qualifications for joining vary (large companies tend to have corporate sales agreements with airlines). These business loyalty programs complement the airline’s existing frequent-flyer program, so individual travelers and their companies earn rewards in separate accounts. There’s no choosing between earning in one program or the other; essentially it’s an opportunity to double dip and earn rewards twice for each flight.
Here are a few other high-level characteristics of these programs:
- Corporate loyalty programs also require businesses to designate an individual administrator who will have control over adding and removing employees along with the authority to redeem awards.
- Business frequent flyer programs all offer points, not miles, based on the cost of tickets.
- These revenue-based loyalty programs started long before frequent-flyer programs went in that direction, but thankfully, flight awards are for a fixed value based on travel zones. These programs haven’t switched to dynamic pricing — yet.
Let’s dive into specifics for each of these business programs for the three legacy U.S. airlines.
American Airlines Business Extra
American offers its Business Extra program to companies for travel on American Airlines, American Eagle, British Airways and Iberia, as well as on American Airlines codeshare flights operated by Finnair, Japan Airlines or Qantas. To enroll, your company must have two or more employee travelers and cannot have a corporate sales agreement with American or its partners. Companies must be based in the U.S., Canada, Anguilla, the Bahamas, British Virgin Islands, Dominica, St. Kitts/Nevis, St. Lucia or St. Vincent. You can register for a Business Extra account at this link.
Further Reading: Guide to earning and burning with American’s Business Extra program
Earning Business Extra points
Businesses earn 1 Business Extra point for every $5 spent (1/5th of a point per dollar), while employees continue to earn AAdvantage miles as they always do. You can also earn points with the American Airlines Business Extra version of the American Express Corporate Card.
The program offers occasional promotions that can be quite valuable. In the past year we’ve seen promotions ranging from ~500 points all the way up to 10,000. Some simply require new members to join Business Extra and take a qualifying flight, others offer bonuses for flying certain routes in certain cabins (like premium economy between Los Angeles and South America), while the massive 10,000 point giveaway was a raffle for companies sharing their story of how Business Extra had helped them meet their travel needs.
Redeeming Business Extra points
You can redeem points for a variety of awards including flights, upgrades and Admirals Club passes and memberships.
Award flights — Points can be redeemed for award flights based on award charts unique to the Business Extra program. American recently added the ability to redeem points instantly online, a feature that was long overdue. For a flight within North America excluding U.S. transcons, a “PlanAhead” award (the equivalent of a MileSAAver award in the AAdvantage program) is 2,000 points, the equivalent of $10,000 of spending, while business or first class in a two-class cabin is 3,200 points, the equivalent of $16,000 of spending. When it comes to international award flights, you’ll need more points for partner awards than for American-operated flights.
For complete details, check out TPG Senior Writer JT Genter’s post on how to use American Airlines Business Extra points for free flights.
Upgrades — One-segment upgrades cost 650 points for American-operated flights within North America or between North America and Hawaii or the Caribbean. Note that this also applies to American’s premium transcontinental routes, including those operated by specially configured A321T aircraft. These planes feature a true lie-flat business-class cabin and an even more spacious first class, making this one of the best uses of your upgrade certificate. Upgrade awards between North America and Europe, South America, Central America, Asia or the South Pacific are 3,100 points one-way for discounted fares, and 1,200 points for full-fare tickets.
In each case, Business Extra excludes certain fare classes from being eligible for upgrades so make sure to double check that information before you book.
Status Awards — AAdvantage Gold status is 3,200 points, and it can be gifted to a family member or employee.
Admirals Club — A day pass is 300 points, while an annual membership costs 3,300 points.
SkyBonus is marketed by Delta as “a business travel rewards program for small to mid-sized companies.” To be eligible, companies are required to spend a minimum of $5,000 a year on eligible flights and have at least five unique employees completing eligible travel each year. Delta has even gone so far as to unilaterally terminate the accounts of many companies it felt didn’t meet this requirement, or have individuals suspected of abusing the program investigated for fraud.
Earning SkyBonus points
You can earn points on flights operated by Delta, Aeromexico Air France, KLM and Alitalia. SkyBonus members earn a different amount of points based on their fare class and whether or not they’re flying to or from Atlanta (ATL), Cincinnati (CVG), Detroit (DTW), Minneapolis-St. Paul (MSP) or Salt Lake City (SLC), presumably the cities where Delta has the least competition for nonstop routes. This program also defines three levels of fare classes, with the highest level including full-fare tickets and the lowest level based on highly discounted, non-refundable tickets, including those in Basic Economy. You can also earn points for purchasing upgrades more than 24 hours before departure.
Companies can earn as many as 30 points per dollar for non-refundable fares that don’t go to or from ATL, CVG, DTW, MSP or SLC, though the earning rate drops as low as 1 point per dollar for discounted flights to or from those hubs. You can also earn points through purchases from Delta Private Jets.
Companies that earn 2 million points during a calendar year also qualify for SkyBonus Elite status, which offers 10% more points on top of normal accumulation rates, plus priority reservations and access to special SkyBonus Elite flight certificates that have even more availability (and cost far more points).
Redeeming SkyBonus points
Unlike the SkyMiles frequent flyer program, which no longer has published award charts, the SkyBonus program still has an award chart on its website, complete with “standard” and “enhanced” award availability. A standard economy-class award for travel within the U.S. (excluding Hawaii) and Canada is 90,000 points, while the price of the “Enhanced Availability” award leaps to 210,000 points. Comfort+ awards for the same route are 175,000 points.
Other SkyBonus awards include systemwide upgrade certificates, beverage or headset coupons, Sky Club passes and annual memberships, and Silver Medallion status. See the bottom of the above-linked award chart for the price of each.
The PerksPlus program rewards companies whose employees travel on flights operated by United, United Express, Lufthansa, Austrian Airlines, Brussels Airlines, Swiss Airlines and All Nippon Airways (ANA). To join, your company must have at least five employees and a valid tax ID, and it can’t be enrolled in any other airline discount program with United or another participating carrier, which I believe refers to corporate sales agreements.
Earning PerksPlus Points
Like Delta’s SkyBonus, this program offers a different amount of points based on the fare class and whether or not you’re traveling to or from a hub market. United hubs that receive lower rates include Chicago-O’Hare (ORD), Denver (DEN), Guam (GUM), Houston (IAH), Los Angeles (LAX), Newark (EWR), San Francisco (SFO), Washington-Dulles (IAD) and Tokyo-Narita (NRT).
There are also three buckets of booking classes that offer different levels of earning rates. Fully-refundable fares and premium-class tickets earn as many as 6 points per dollar spent when traveling to and from non-hub cities, while highly-discounted fares to or from a hub earn just 1 point per dollar. All points earned by the company in the PerksPlus program are in addition to whatever MileagePlus miles the traveler earns.
Redeeming PerksPlus points
As with both American and Delta, United publishes an award chart for its small-business rewards program, including both flights and other redemptions. For each type of flight award, there are three different classes of price and availability. For example, round-trip economy-class awards in the contiguous 48 states, Alaska, Caribbean, Mexico and Central America could be 40,000, 70,000 or 180,000 points, depending on availability. This means that you could earn an award flight with as little as $6,667 in spending on the most expensive tickets.
Non-flight awards include MileagePlus Premier Silver status for 60,000 points, Premier Gold status for 120,000 points and a one-year United Club membership for 65,000 points. You can also convert two PerksPlus points to a MileagePlus mile, with a minimum of 10,000 points per transfer and a maximum of 100,000 miles received per calendar year.
Of these three programs, American’s is the only one that offers the same number of points per dollar spent, regardless of fare class or whether or not you travel through a hub. It also has the least complicated award chart with just two classes of awards for most destinations, and the least strict (and least enforced) eligibility rules. This alone may be enough of a differentiator for you to consider going with American.
United and Delta’s programs are very similar to one another, with Delta offering a far more dynamic chart for earning. This features greater rewards for non-hub travelers purchasing the most expensive tickets but provides paltry rewards for hub-captive travelers on discounted tickets. If your company is based in one of the five Delta hubs that receives fewer points and your employees typically travel with advance notice, it will take a monumental amount of spending to earn any meaningful rewards with the SkyBonus program.
That being said, while SkyBonus isn’t such a strong program for those hub captives, it can be very rewarding for Delta flyers in other cities with a large Delta presence such as New York, Los Angeles and Seattle. A similar conclusion can be drawn for United’s PerksPlus program.
One of the most important lessons of the points and miles world is to maximize your earnings at every turn, and this is especially true for small- to medium-sized businesses. Whether that’s opening a new business credit card or leveraging online shopping portals for supplies and equipment, there’s no shortage of ways to boost your return on everyday spending, including employee travel. Any time you can “double dip” on your rewards with a program like this, you come out ahead. With no cost and minimal requirements to join these programs, it makes sense for business owners to sign up and participate in all of them to see which works best for their company.
Featured photo by Hinterhaus Productions/Getty Images
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