Frequent-flier mileage awards a challenge

Frustration among the 81 million members of Delta's SkyMiles program grew two years ago, when the airline moved to a tiered redemption structure. The lowest-level round trip award still costs 25,000 miles, the standard for big airlines, but with limited availability. To get more domestic flight choices, members have to spend 40,000 miles at the medium level or 60,000 at the highest level.

There’s a perception that Delta has made it “extremely difficult” to book award flights unless customers shell out thousands of extra miles for the higher tiers, said Tim Winship, publisher of FrequentFlier.com.

“I can’t remember a time when there was such a universal distaste for a particular program than there is for Delta’s today,” Winship said.

Consultant Jay Sorensen, who specializes in frequent-flier programs, said it appears Delta wants the bulk of redemptions to be in the 40,000- mile tier.

In a recent study by Sorensen’s firm, IdeaWorks, SkyMiles ranked second to last among 22 frequent- flier programs in award- seat availability at 25,000 miles for flights several months out. The firm looked for flights in February and March for travel between June and October and had only a 13 percent success rate on Delta. Only US Airways was worse, at 10.7 percent.

“If you belong to Delta and you’re planning on scoring seats for a family of five to San Francisco in July, don’t frustrate yourself,” Sorensen said. “It’s a caution flag, that this is a handicap for this program.”

But Jeff Robertson, vice president of Delta’s SkyMiles program, said it’s difficult to compare airlines because there’s no central database for redemptions. He said Delta also offers better award availability for elite frequent fliers than for its other frequent fliers.

“The expectations that rewards are [available] at 25,000 miles have been created by the airline’s own advertising,” Sorensen said. “Clearly US Airways and Delta, I don’t believe, are fulfilling that all the time and that’s an area they should work on.”

Delta spokesman Paul Skrbec countered that a total of 8.5 percent of passenger miles flown on Delta last year were for award travel, second among the major network carriers only to American Airlines at 8.9 percent of passengers and just ahead of No. 3 United Airlines at 8.3 percent.

Delta also made a change last month that was a win for its frequent fliers: It removed last-minute mileage redemption fees, matching an earlier move by United. That resulted in a double-digit increase in award bookings, Robertson said.

And at around the same time, Delta opened more seats for booking with miles within 21 days of a flight and in the period three to six months before a flight, Robertson said.

Although there’s some risk Delta could lose the opportunity to sell a ticket, “every time we redeem a frequent flier mile, we actually get a revenue benefit,” Robertson noted. That’s because of a change a few years ago in how Delta accounts for miles. Some of the miles are awarded by partners, such as credit card or car rental companies, that pay for them upfront. Under the accounting change, Delta books some of that revenue once miles are redeemed.

Sorensen said anecdotal evidence confirms that Delta may offer better award availability for last-minute flights, a difference he said he may account for in future studies to “provide a truer picture of the reward seats.” He noted that while last-minute redemptions may be useful for some people — say, entrepreneurs booking business trips on short notice — it’s not as useful for vacationers.

Most Atlanta travelers have no practical alternative to SkyMiles, given Delta’s dominance at Hartsfield-Jackson International, where it handles about 75 percent of traffic. AirTran Airways, which operates the only other major airline hub in Atlanta, handles another 16 percent.

But AirTran is primarily a domestic airline and does not fly to Europe, Asia or South America — plum destinations for diligent mileage collectors. And unlike Delta, AirTran issues credits that are only valid for one year, even if your account remains active, so it is useful primarily for those who fly AirTran often.

Business travelers with small and midsize companies are the biggest users of AirTran's frequent- flier program, AirTran Chief Executive Bob Fornaro said.

“We’re reviewing our frequent-flier program for strengths and weaknesses,” Fornaro said. “We’re not going to be all things to all people. ... It’s more difficult for AirTran to cater toward global companies probably because we don’t have the global network. But that’s kind of our game plan.”

Delta could face a challenge with the proposed United-Continental merger, which stands to bump SkyMiles from its position as the world’s largest frequent-flier program. Both rated much higher than SkyMiles for base-level redemption rates in the IdeaWorks study.

“We will be prepared with our program and our airline to respond to anything they do,” Robertson said.

Robertson acknowledged that even with improvements in award availability, there may be few seats available during summers and other peak periods. In the last year Delta began allowing passengers to redeem miles for hotels, rental cars and merchandise on its new SkyMiles Marketplace Web site.

It could get more difficult to redeem miles for free flights in the future as business recovers. In the past year airlines have trimmed capacity to better match demand, resulting in fuller flights.

“Reward availability was better during the depths of the recession, because the airlines didn’t have anything else to do with the seats other than give them away,” Sorensen said. “A rising economy is particularly harsh on reward availability.”

SkyMiles award flight availability

Delta last week gave these figures for base-level award flights in the next two months:

August

● 44 percent of flights open at 25,000 Saver level

● 61 percent open at 25,000 Saver level for Platinum or Diamond SkyMiles members

September

● 57 percent of flights open at 25,000 Saver level

● 75 percent open at 25,000 Saver level for Platinum or Diamond SkyMiles members

Source: Jeff Robertson, vice president for SkyMiles, Delta Air Lines

Ranking the airlines

IdeaWorks last winter looked for base-level (25,000 mile) award seats in June through October. Here are the success rates for selected airlines:

● Alaska Airlines, Mileage Plan: 75 percent

● Continental Airlines, OnePass: 71.4 percent

● United Airlines, Mileage Plus: 68.6 percent

● AirTran Airways, A+ Rewards: 67.9 percent

● American Airlines, AAdvantage: 57.9 percent

● Air France/KLM, Flying Blue: 56.4 percent

● Delta Air Lines, SkyMiles: 12.9 percent

● US Airways, Dividend Miles: 10.7 percent

Source: IdeaWorks