Frequent Flyer Programmes, Compared

Every programme can be placed on two axes, and those two answers predict most of what you need to know.

The industry has moved decisively toward revenue-based earning and dynamic redemption, for the obvious reason: it removes the outliers in both directions. A fixed chart with distance-based earning could be worked to produce genuinely extraordinary value. A revenue-in, revenue-out programme is essentially a cashback scheme in a foreign currency.

Alliances matter less than they did — bilateral partnerships and joint ventures now do much of the work — but they are still the fastest way to understand where your miles and status will be recognised.

Three of the world’s most prominent airlines belong to no alliance at all: Emirates, Etihad and most low-cost carriers. Emirates instead runs an extensive bilateral partnership with Qantas and others. The absence is deliberate — a carrier whose whole model is connecting traffic over its own hub has less need to borrow someone else’s network.

Roughly one to one and a half cents, most of the time. That is the uncomfortable headline. The spread around it is where the whole hobby lives.

• Is there a published award chart? If yes, the programme has committed to a price and you can plan. If the price is “whatever the cash fare is,” you are looking at a cashback scheme.
• Do miles expire on a hard timer? Activity-based expiry is manageable. A fixed 36-month clock is a real constraint.
• Can you redeem on partners, and is partner availability visible online? The best value in almost every programme is redeeming on someone else’s aircraft. A programme that hides partner availability behind a phone call is worth much less than one that does not.
• Are there fuel or carrier surcharges on awards? Some programmes add several hundred euros of surcharges to a “free” long-haul ticket, which can wipe out most of the value. This varies dramatically — the same partner flight can carry very different surcharges depending on which programme you book it through.
• Is status earned on spend or on flying? If you fly cheap tickets often, a distance-based programme is worth far more to you. If you buy expensive tickets rarely, the revenue-based ones will treat you better.
• Is there a transferable currency in play? Bank points that transfer to multiple airlines are structurally safer than airline miles, because a single devaluation cannot trap your balance.

There is a reason these programmes have grown steadily more financial and less aviation-flavoured over four decades. A loyalty programme is one of the few parts of an airline that generates cash without flying anything, and its liabilities are denominated in a currency the airline issues itself. That is an extraordinarily attractive business, and the airlines know it — which is precisely why the terms move in the airline’s favour over time.

None of which makes the programmes useless. It makes them a tool with a known bias. Earn where you actually fly, redeem for the things that are absurdly expensive in cash, keep your balance low, and read the change notices when they arrive.