If things go according to plan and history, Lufthansa should be rolling out ‘enhancements’ to Miles & More sometime in the 3rd or 4th quarter of this year. Typically LH tweaks their program every 2 years so we’re due, and if the announcement is similar to what other Frequent Flyer programs have implemented, people will start to cry that the sky is falling and the end days are upon the elitist maximizer…….
If you have been paying attention to airline loyalty programs, you’ll notice that most have transitioned, or are transitioning away from miles flown to determine status and are gravitating towards cash spent to determine status levels. In other words, programs have become revenue based and the trend is spreading through the airline industry.
What may happen to Miles & More? A few things…..
According to trusted sources that are near and dear to Lufthansa, it appears that one major change to Miles & More will be a move towards a revenue-based loyalty program. From an airline’s perspective, this model has obvious advantages to the balance sheet and only makes sense to be implemented. What remains to be seen is what the spend requirements will be for those striving for Frequent Traveller, Senator or HON Circle status levels. Should the revenue model come to pass, expect the program to be favored towards passengers who are paying for full fare classes (F, A, C, D, J, E, G, B, Y).
Discount fare classes such as P and Z along with most Economy Classes will be on the losing side of the proposition as far as helping you gain status is concerned. Another major concern will be how the program handles passengers who fly a lot of segments within Germany and Europe, but don’t spend a lot of money because even the most premium fares are not very high in most cases.
Other considerations on the drawing board for Miles & More include revamping the program to better integrate Eurowings (Lufthansa’s Low Cost Carrier unit) and how mileage/spend credit will be calculated from flights operated for Star Alliance member airlines. Not much has come out of the rumor mill on these points, but it is obvious that Miles & More will need to be amended to account for these points should the transition to revenue-based loyalty take place.
Am I a fan of this? Mostly yes.
What I like about revenue based programs is that it does reward an airline’s best customers and that is what a loyalty program should do. Reward those that spend the most money, not those trying to ‘game’ the system just so they can get into a lounge. What I don’t like is that I’ll have to focus more on the dollars I spend vs. the fare classes I buy, but the benefits of the program and my travel habits easily support the decision to accept a revenue-based plan.
With the current Miles & More platform for example, it is easy to gain Senator Status for as low as $4000-5000. Especially when you can book United ‘A’ fares within the United States for only $800 (Chicago -Washington DC – Seattle as an example). A smartly built itinerary can easily yield 18-20,000 status miles with something like this. Book 5 or 6 trips, and you’re Senator. You never would even have to board a Lufthansa operated flight to earn SEN, yet Lufthansa now bears the costs of that Senator’s membership including Lounge Access, E-Vouchers, etc. Creating a true loyalty program that actually rewards loyalty is in my opinion the proper business decision for any airline.
Predictably, there will be a lot of protesting, snorting and grunting if and when these changes come to pass. In my humble opinion, the Snorters and Grunters will ultimately be those that will be priced out of a loyalty program simply due to their lack of loyalty. In theory this should improve the quality of the program for those who actually are loyal (key words of course being ‘in theory’).
Much more to come as we get closer to September and October when I expect the rollout of any changes.