The Economics of Airline Miles – Part II

The Value of Elite Status

As I mentioned in part 1 of this series on the ‘Economics of Airline Miles – The Value of Airline Miles‘, to me the most valuable miles I earn are status miles (EQM). That does not mean that award miles (RDM) are unimportant to me, but earning Elite Status is a critical goal. If I earn Elite status, earning award miles will become easier too, as I will talk about in this post. The benefits of Elite Status are tremendous and worth a lot to you the traveller. So, every year, my first and foremost goal is to earn Elite Status on at least one airline. Your flying patterns and airline of choice will determine which Elite Status level you are able to earn. In my case specifically, my goal is to earn Premier Executive (1P) status on United Airlines. This is earned at 50,000 EQM. It also earns me Star Gold status on the Star Alliance. Once I have earned this Elite Status, then I can decide, based on my prediction of travel for the rest of the year, whether I can reach the next level – 1K at 100,000 EQM on United. If not, I then have the option to maximize my award miles by flying United or shoot for award miles or even elite status on another airline. In my case, my backup airline is British Midland (BMI). I go for BMI because earning Gold status on BMI gives me lounge access on all domestic travel on any Star Alliance flight within the US. I made it last year. This year it looks like too much of a stretch, so United it is for the whole year.

Enough on my travel and mileage earning patterns. Back to the topic of Why Elite Status is so Valuable. Here are my reasons:

Bonus award miles:

Most airlines give bonus award miles for every mile flown. This can range from 25% to 100% depending on the airline and the Elite Status level. For Example, United Airlines gives 25% bonus award miles at Premeir and 100% bonus award miles at Premier Executive Elite level. That effectively doubles the rate of earning award miles!

Upgrades:

When available, airlies give out Upgrades based on the order of your Elite Status. People with higher statius are always higher up in the upgrade waiting list. Some airlines use ‘instruments’ (miles or upgrade coupon) for upgrades. You have to be an Elite to even get these upgrade coupons. Other airlines, such as Continental and US Airways have complimentary upgrades for Elites. If there is a unsold seats in First or Business class, they are given out to Elites for free and at no charge. I would like to point out here (this is breaking news) that United announced just earlier this week that they will go to this ‘ulimited and free upgrades for Elites’ model for all demostic flights, starting 2nd quarter of 2010.

Priority boarding:

Airlines allow their Elite members to board before the non-elites.

Free checked bags:

This is a big benefit nowdays as airlines have started charging even for the first checked bag for non-elite travellers. Typically these fees are waived for 1 or 2 bags for Elites.

Additional bags allowed:

In most airlines higher level Elites are allowed extra baggage for free. This is especially true (and more useful) for International flights. This policy varies significantly by airline and also by destination. So, do check with your airline before showing up at the airport with extra bags.

Priority baggage handling:

Most airlines have priority baggage handling for Elites. As a Gold on Star Alliance, on every international trip, I have had my bags amongst the first on the baggage claim carousel!

Access to Premium Economy seats:

If, that is, the airline has premium Economy seating. For example, United Airlines gives free access to its Economy Plus seats to all its Elite members. These have 5 inches of extra leg room. Now that is ‘premium’. United Premier Executive members get access to exit rows! This varies significant by airline. US Airways has seats designated as Premium seats. I have yet to figure out what is ‘premium’ about these seats, except that they are in the front half of the economy cabin…

Elite status recognition on the airline alliance:

If the airline participates in an alliance, your Elite status is recognized across all airlines in the Alliance. For example, you get Star Silver or Star Gold status based on your Elite status in any Star Alliance airline.

Lounge Access:

Mid-level or Higher level Elites get free lounge access on international trips. This is a great benefit given the extra time one has to spend at the airport on International trips due to early check-in requirements. My international trips typically require a connection. Lounge access at the connection city, between two long flights is a great respite.

Priority Check-in:

Airlines let their mid and higher-level Elites check in with Business or First class. A big time saving if you have bags to check-in.

Irr-ops:

Irregular Operations or Irr-ops, as they say in airline lingo, is flight delays, cancellations, etc. Elite get handled first in all such situations. I have experienced this when an flight got cancelled, just a couple of weeks ago. They had me all set up on another flight before I even showed up at the airport. Other non-elites were all waiting in line for their turn to get re-routed.

Customer Service:

On similar lines, Elites get priority treatment with customer service. Elites typically have a separate phone # and email id they can use to contact the airline.

All these reasons (and I am sure I can think up a few more, if I continue writing) make it extremely valuable to be an Elite. Pick an airline you want to be an Elite on and start focussing on the goal to get there. Remember, most airlines use the calendar year for Elite qualification purposes, so timing is important.

Thoughts? Feedback? Do leave a comment.

As I wrote this post, I realized that I assume a good knowledge of Elite levels and how they are reached. As I get a lot of questions on how to be an Elite, I am taking a break from my series on the Economics of Airline Miles. My next post is on the How and What of Elite Status. Following that is part three of this series on How to Maximize Airline Mile Earnings and part four on Maximizing Mileage Redemptions.

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