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Things have been somewhat quiet for a while from the “enhancement” team at Delta SkyMiles Corporate headquarters in Atlanta. I mean we did have 1JUNE16 to look forward to when award ticket prices will potentially go to 1 million for a single business round trip ticket. And, we did have the 16MAY16 change when C+ seats become a fare class on their own and the complete mess that will create (no thanks for this Diamond). But what do I see happening next for the frequent flyer program? Let me tell you, I see nothing good for most of us.
I expect the next enhancement will be the end of MQMs (and MQSs).
Yep, only MQDs or Medallion Qualifying Dollars will be all that matter for your elite status. We really should not be surprised about this coming change. Delta has all but decimated earning RDMs or redeemable SkyMiles this year and we all know flying is the dumbest way to earn points for awards. But Delta this year left in place the ability to earn elite points just as it has always been – not for much longer. But how will this work?
It really will be quite simple and all spend based. Delta will only reward loyalty with spending. I expect elite levels for 2017 will look something like this:
This, from Delta’s view, fixes and streamlines so much. Elite status after all is not about how much or how long you have been flying with Delta or how many segments you fly. No, it is all about how much money you give to mother Delta. That is loyalty, nothing else matters!
This also addressees a number of issues for Delta. Delta has done an amazing job of getting folks to jump on the FCM bandwagon. So many are willing to fork over money for an upgrade (not me, not ever, not once). When Delta is selling a first class upgrade for as low as $9.50 I can see why people would jump on such an offer but with so many less seats open for elite upgrades, and many top elites complaining about upgrade percentages dropping this year, thinning the top elite ranks by MQD spend means those who are most loyal to Delta (i.e. spend most) get the best shot at those few remaining seats. All the rest of the Medallions can fight for the “upgrade” to a middle C+ seat.
Clearly this also will mean an end to rollover MQMs. So will there be rollover MQDs. Maybe but I doubt it. No other airline jumped on the rollover elite points train when Delta did it. There is very little incentive for Delta to reward you next year for your last year’s loyalty. Loyalty is about “what you have done for me lately” not in the past. So I expect the MQD spend clock to reset 1JAN each year like now.
What about AMEX then? That is the wild card. Don’t expect MQD exemption like we see today. Delta has AMEX locked up in a long term contract and can, and will, do anything they want with the cards, perks and points given to the co-branded AMEX Delta card holders (think about the end of +1’s in SkyClub for example). So how will this work then?
I expect we will see some kind of credit via huge AMEX spend toward your MQD totals. For example spending $25, $30, $50 or $60,000 per year on the cards could net you a few thousand MQDs credit toward status. In other words it will require spending a bunch with both Delta and AMEX to make it all the way to Diamond Medallion for the year. Again loyalty, aka spending, is rewarded.
This would also make the yearly insanely expensive selling of MQMs simpler as well. Notice Delta no longer talks about spending vs flying somewhere as they did in the past years to sell you on the buy MQMs idea. Next year, if you are $1,000 or even as high as $5,000 short of some elite level, just give Delta that much cash and bingo you have done the buy-up for status. Now I am sure they will cap this at some level but then again why even do that. If someone wants to give Delta say $10,000 to be Platinum, why not? Folks seem more than happy to pay up when Delta asks them for elite perks at year end.
What about million miler status? That is a hard one. I think those who have reached the levels under the current system are locked in (as long as the program exists, that is). Maybe this will still be distance and fare class based and the one remaining legacy part of the old Medallion program at least for a few more years. Or, this too could flip over to spend based as well. Again, loyalty to Delta is spending and spending big each year.
This change will clearly mean the end of all mileage runs unless you maybe need a few thousand more for some million miler level (if that even remains as is). After all where we go or how far we go does not matter – only what we spend with Delta.
How likely is all or any of this to happen? If we do not see the announcement this year, I think it will only be a matter of time before something very similar to this does come to fruition. Expect this sooner that later.
What else will we see beyond this? Let’s save that for another post as I think this is enough to take in for one day! – René
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Don’t give them any ideas! !!
@Jane – Please understand this has been on the way for a while. It is just a matter of time. Other cuts are on the way as well but one post at a time.
Hate to say it… Less DMs is a good thing. The first year DM was introduced, the class was 32,000 Delta flyers strong. My guess is that number has more than doubled if not tripled.
As someone who will end 2015 with just over 250,000 MQM’s I feel sick. Allowing all the airline mergers over the past 7 years was disastrous for consumers. There is no competition. It’s really not a competitive free market any more.
“…reaming seats…”(4th paragraph).
Sounds about right.
@Geoff – Uh, whoops! Fixed. But yes, funny!
You, Rene, are the victim of your own success. Your blog is so successful that Delta pays careful attention to it. They see exactly how you game the system and make changes to stop it. You can choose to complain bitterly about these changes, or you can embrace them as a challenge and figure out how you can help us to navigate through each minefield. Thank you for the wonderful information we get from you each day.
Rene, in all seriousness, why does Delta not just eliminate their FF program?
I know they have a huge deal with AMEX but given the almost total lack of true competition(it’s more like collusion), why not just eliminate it?
Delta could essentially say, ‘you don’t like it??” Tough cookies, we don’t care..” Go to United or American.
Don’t think they wouldn’t just follow as well.
Next year will most likely be the last year I will be PM with Delta after holding that status for a number of years now. Before that of course Gold and Silver. The latest changes especially with the Comfort seats being changed to now be an upgrade and not allowing PM and above to move a Spouse along with the PM up at the time of a booking is the final straw. Dropping all status with Delta and all spend on the AMEX cards. Time to move onto booking the most economical flight and not waste time on loyalty.
@Rene
Are you implying by your response to Jane that you know for 100% certainty that MQMs will be gone?
More importantly, will MM be gone as well for those of us trying to achieve it.
@Mike from DC – The post stands as written. I have no idea what will happen to MM program also as posted.
I would argue rollover MQMs is probably the last place that Delta encourages active loyalty. I don’t agree with any of the cuts or program changes so don’t get me wrong. But allowing you some teeth in the game from leftover travel from the year prior incentivizes you to keep going or to stay the course.
Purely eliminating all instruments of the “race” only leave you with stagnate medallion classes and former loyalist that swap loyalty or purely fly on price going forward. Leaving delta only able to count on the biz contracts each year and then roll the dice on the rest of the rank and file. Meanwhile, it’s clearly cheaper to fly everyone else. But I’m sort of new to this, so literally just my 2 cents.
As a frequent business traveler that only uses Delta twice a year with family for leisure the elimination of MQM and getting status by MQD would not be bad for me. This year I spent over $40k with Delta, earned over 500k miles BUT did not get over 125k MQM to become Diamond. To be fair I decided to stop at Platinum since I know next year I won’t fly the same MQMs I flew this year so it will be easier for me to re-qualify for Platinum next year with the rollover. However, I know I will still spend close to $50k on Delta flying paid business class to Europe and South America. Just as an example, on one flight to Europe I spent $8,500, got 75,000 miles for the flight BUT only 4,666 MQM. Again, if Delta wants to reward customers that spend a lot (I am not saying I agree with their rationale) someone like me that spends $50k/year should have the highest elite status with them.
I’m under no illusions that this will be good for me. Even though I already have committed to ending all mileage runs on Delta and moving a huge amount of my business to American and jetBlue based on convenience and superior fares, a portion of your projected change appeals to me. I will achieve MQD Diamond for 2016 (even under the new numbers) but miss on MQMs because I ripped out all mileage run plans for the 4th quarter. Moreover, I had rolled 25,000 MQMs from last year and only spent $500 for the few mileage runs I took this year. It is most unlikely that my posture toward Delta will change because I have been shown great disrespect by corporate on more than one occasion. Even so, your projected change raised an eyebrow.
Delta crews, gate reps, SkyClub reps, phone reps, and maintenance specialists are ALL outstanding. They are the reason I am a loyal Delta flyer.
I have flown 79 segments so far this year. No missed connections. No significant delays. Wow!
The Delta Bean Counters, however, are another story. The cuts they have made to the Medallion Program for 2015 indicate they don’t value loyalty. Last month’s cuts to Delta Comfort+ seat access by Platinum & Diamond Medallions and their traveling companions are especially painful.
And Bean Counters: Please stop insulting our intelligence by referring to Medallion Program cuts as ENHANCEMENTS.
They say if put a frog in hot water it will immediately jump out. But if you put a frog in cold water and turn on the heat it will stay until it dies. Delta’s Bean Counters know this.
But Bean Counters beware! If you take away the rollover of MQMs, Medallion Members will leave Delta in droves. And I will be the first.
Maybe with the “buy your way up” fees they could upgrade the IFE on their ancient aircraft. I can’t believe that in 2015, Delta flies planes with shared overhead screens with movies on VHS tape cassettes. My question is this – Since Blockbuster went out of business, where does Delta get movies on VHS tapes? Even their safety briefings are on VHS tapes that hop, skip, jump and just plain stop when played.
@Santastico but really should someone who, let’s say, flys a handful a times a year at full FC prices be considered a loyal flyer? And get the highest status? Weren’t these perks created for people who travel all the time? To give them a little comfort during what can be a tiring life of business travel? There are people who travel every week who will get a HUGE shaft from this. And the nice little thing they could look forward to was maybe a free cocktail and a wider seat. Every now and then a meal. I think they deserve it more than someone who goes to China 2 or 3 times a year and spends 15k each time. My two cents.
@ Rene — Please confirm that this is PURE speculation. You make it sound so certain. Not saying there won’t be more negative changes….
@Gene – I expect this to happen (or some version of it). This is a post based on info from a number of sources.
My MQDs have been roughly $50 k this year and last. If all it takes to be Diamond in the future is something less than $20k, that will allow me to book over half my flights on a competing airline in hopes of top status on two carriers. My MQMs are around 150k each year, which is not enough for dual status based on miles. I don’t understand how this would be a wise move, especially by bean counter standards, as Delta will get only $16 k of my dollars while another airline receives $30 k. The attractiveness of rollover for Delta’s bottom line is it keeps elites flying Delta even after they reach top status for the year.
@Layla – The point you make would be the reason for rollover MQDs.
Doesn’t @Delta realize that the rollover component of the program actually makes people fly more? spend more? It makes no sense from a business perspective at all. I have 600K moles to burn and i’m just going to PWM on a first class ticket from now on until they are gone to avoid the UG lists. Though I will keep accruing MQMs! Ha. I’m stuck on this crazy ride!!! 🙂
I agree with others here who gave said that essentially delta is attempting to eliminate the “gamers” of the system and I’m just sorry I came too late to the “game”. I also think delta is going to make so many “descending” cuts that nobody but the fat cat international business traveler is going to care when delta eliminates the ff program. My husband will hit two million miles next year and every single mile has been earned domestically or with Amex spend. And, no, we didn’t get a bonus for signing up with Amex because we got it before you got such bonuses and didn’t cancel and re-apply before delta ended that benefit. He has to use his company travel agency to book his flights and has to take the least expensive flight so we don’t get credit for a direct booking. But, I also haven’t purchased a ticket in at least ten years for the one or two trips I take with him a year. So, I say thank you for that much, I suppose.
@ Rene — Are you implying these changes would go into effect 01JAN2016, meaning no rollover MQMs in JAN 2016 (ie, in 3 weeks)? I can’t imagine even Delta being that slimy. If they end rollover MQMs and MQMs as part of qualification beginning 01JAN2017 (with notice sometime soon), I can live with that.
@Gene – No. These things take time to move into place. Keep in mind we are NOW, and have been all year, earning 2016 status. Once 2016 starts we will begin to earn 2017 status. So, changes would have to be announced before they impact us (one would hope). Thus, these kinds of changes would be for 2018 Medallion year at the soonest. Put simply all stays the same for at least one more year (we hope).
@ Rene — Perfect, thanks! Delta may be about to lose lots of my business (or perhaps gain, since all the US programs’ revenue changes will likely force me into loyalty with one or none of them).
The changes to Comfort+ have been enough to make me change my flight plans for next year. The benefits for loyalty with Delta are dwindling and I’m not planning to stick around for what’s to come.
Time to knock back a couple of Woodfords. The end is nigh. It’s been nice knowing you all. #ImpendingDoom
@Jane: I Agree 100% with you. All these perks WERE created for people who travel all the time and to give them a little comfort during what can be a tiring life of business travel. HOWEVER, that was before someone called Richard Anderson decided to change that all. Today, it is all about money!!!! Here is a quick example and who do you think Delta gives more value as a customer based on their money mentality: If I fly 6 times per year MSP-AMS-MSP on business class at around $8300 per ticket I will get less than 74k MQM (including the 50% bonus for paid business class) and I will generate $50k to Delta. Let’s get a passenger that flies 35 times ATL-LAX-ATL on coach at around $400 per ticket. This passenger will get 136k MQM and only generate $14k to Delta. Thus, I spend $50k and I get Gold status while the other passenger spends $14K and he gets Diamond status. Who do you think Delta values more?
Again, I am not saying this is right. I hate what Delta is doing but that is what they are doing. Thus, if they keep going this route I would want them to give me Diamond for spending $50k even if I only fly them 5 times.
@Jane: No, I think that, from DL’s perspective, they’d much rather get the 18k from the guy flying 3 RTs to China than the domestic manager flying all over the U.S. all year. The more you spend, and the LESS you fly, the better for DL.
@James: I’m not calling it a TREND, but my last two flights on DL, they were out of Woodford. The JD was fine, but . . .. . Flying ATL to JFK tomorrow and will test again.
I wonder how this would affect foreign SM members like me, who are excluded from any MQD requirement?
@James – Yes. It will be interesting if they make the rule the same for those outside the USA as inside or if there is still a waver.
The “thinning of the tanks” seems to have a positive effect on my upgrade rate. It’s a silver cloud on my own SM cloud.
As an loyal elite Delta flyer since about 1990, what really makes me sad, they are just selling out the dream…in my 20’s, as a Royal Medallion, I kept dreaming of becoming a million miler….once they started with the PM level in 1995, and the DM level in 2001 (I think) I started thinking, if only I can his lifetime Platinum status by the time I retire….now, at 51, and 3.3 million MQM.s, I can just see the rug being yanked out from under me before I can get there wit 4M MQM’s….and you have to wonder…..spending nearly $40K this year on MQD’s, and about 350K MQM’s, what benefits have I seen beyond a some extra miles…no extra regional or global upgrade certs….no extra special treatment after hitting DM …I get the money part, but as you’ve said before, Rene, they’re just eliminating our dream……sad…..thanks for kiling my DL buzz….what little of it is left
@Greg – When jet are full they have no need to sell the dream I hate to say!
*ranks not tanks!
@James – Ya know, when everyone is a tank no one is 😉
@Rene – I think your speculation is spot on, however I think those numbers are way too low. I would bet that for Diamond it will be north of $30K and PM will be in the $20K range,
@Dennis – You may very well be right. We shall see.
Any thoughts about how current MQM bonus features might end up? (Reserve/Plat MQM bonuses, etc)
@honoraryorange – I mentioned what could happen in the post.
@rene – long time reader, first time commenter.
Upfront, I love the blog, a ton of super useful stuff all the time. Its sincerely appreciated.
This time however, not so much. As you are a long time FF and Delta loyalist, I get your frustrations with them, its warranted on many levels, but this piece just feels like fatalistic musings of someone who is super pissed that you can’t game the Delta program the same way you once could.
As someone who does revenue optimization for a living (think games & advertising for 20+ years), I have to say I think its a big stretch for Delta to get rid of MQMs. Sure, I guess anything could happen and who knows, maybe they have some rookies (from what I’ve seen I dont believe so) in charge of their revenue programs who might think something like this is a good idea. I don’t even entirely disagree with the possibility that there are different corporate groups (e.g. finance) who really want to do this.
With that said…
The loss of the MQMs “lever” as an ability to shape customer behavior would be HUGE. IF I were running this program and they came to me with this proposal, it would be basically “if you do this, I’ll resign” kind of situation. If this is done, then there is no Skymiles program. And don’t kid yourself, people who are talented in customer acquisition and retention can get a job ANYWHERE – they are in high demand universally. They don’t need Delta as much as Delta needs them. So, what your blog post really should be about is whether they are just going to stop the FF program.
Closest parallel I can think of is iOS phone games (e.g. farmville). Typically, these games are free to download and then, they have two types of in game currency – engagement currency and “real money trade” currency. Within these games, some items can only be purchased via “playing the game” and others you need to actually plunk down real dollars. The two types of currency work together – the more you earn via engagement (e.g. that purple cow) leads you to “buy” more things with real dollars. MQMs and MQDs are not completely analogous, but they work in roughly a similar way. Almost every game in the iOS market has some degree of this in place. You have to give consumers ways to earn things without paying or they never have the incentive to pay. In this case, moving to a pure MQD model, would most likely reduce some portion of customer engagement.
Using my own circumstances as an example, I’m Plat and I spend $25K+ per year. I usually take 3 international trips where price is literally no object (spent $10K to go to Nice, FR) and then a bunch of shorter trips (LAX- SF, NYC, LV,Austin). Under my current travel regimen, even if they set Plat at $20K, I get that easily. AND then, guess what? All of my short trips go to another airline (e.g. Alaska, Virgin). In my case, the revenue they get from me actually DECREASES. Its not like upgrades are so plentiful or even that meaningful on trips like LAX-SF that it matters, but because of MQMs, I still fly Delta. Go to a revenue “only” program and they can kiss those extra dollars goodbye. I could meet my spend by Q1 and then status match/challenge to places like Virgin and Alaska (which I’ve done).
In addition, those Delta AMEX cards I now hold, Plat & Reserve, done! Thats another $800+ fees. Why would I need them if I could just get status with spend?
Which then further begs the question, why fly Delta at all? Sure, they are a great airline – I love the customer service, they’ve been good to me, but spending $30K a year, a lot of airlines will be good to me. Frankly, when you sit in the front of the plane, all the airlines are good to you. So, it wouldn’t be long before those airlines who get my short trips would eventually get my long trips and my Delta spend goes to zero.
The delta folks (luckily for stockholders) are greedy, but I don’t believe they are stupid. I’m sure they’ve studied customer spending patterns and realize that there are significant segments of customers (like myself) that would essentially unwind if they were to do something like this.
Now that I’ve said this, watch Delta do exactly what you’ve said. LOL
@James – My post is not just a guess. I have many sources I have turned to. But I do think Delta thinks they can do no wrong. I do think they wish the FF program could go away but they can’t. So, make all they can from it. This is a way to do that and reward those who clearly are most loyal that is those who spend the most.
@James, great post! Thanks. I’m more or less in your boat, and if DL does what Rene thinks they will do, I will more or less unwind as well.
@rene do you really think the most “loyal” are the ones who spend the most? or is that what delta says. i’m not being sarcastic. i would think how many times your butt is in a seat might be the definition. this sucks! i don’t want to change airlines. but i guess i will if i have to. does anyone status match PM?
@Jane – No question at all. The only ones Delta views as Loyal are those who spend the most. Period.
#Booooooo
No one has brought up Delta 360 — that secret society of high spenders that get extra special perks such as immediate upgrades on any fare at the time of booking. Does anyone know at what spend level people become D360? Wouldn’t D360 take care of the high spender who would only get GM on the MQM scale? @Rene?
@Don – Good point. That is already based purely on spend. So in a way Delta already has an elite level already based on HUGE MQD spend. Txs Don!
I met my first real D360 person the other day. He flies 2 times per month to Europe from the southeastern US every month. He told me he pays for business class “straight up” every time. He’s never gotten a ride in the Porsche or anything other than a DM upgrade on his connection from ATL home. He told me he hit 3 million miles early in 2015 and the pilot with a Delta VP came on board to thank him – in coach! No upgrade no gift, nothing. And now he’s “bent” because his wife has no status and if he wanted to fly with her, he couldn’t even get C+ unless he paid.
So, I don’t know if there really is a secret society you speak of. But he showed me his D360 metal tag (cow bells) and card and said he gets “mis”treated like everyone else.
James: comment more!!
It is what it is and it will be what it will be. What I find sad? R.A. will retire and leave others to clean up the mess as the ‘loyal’ are no longer.
@Dale – The problem is once RA and the current crop retire, the next group will want to cut 2x as much to show they are as brutal as the current group.
I live in Atlanta and have a friend who is a DL employee with 40 years at DL. He has seen lots of higher ups come and go. He tell me that the problem with the current crop is that when a new person gets into a position as the head of something — even if there are NO PROBLEMS in that department and it is running smooth as silk, the new person at the head of that department feels they have to do something — make changes, just to justify having the job. If they do not try to make some “tweeks” someone will wonder why their position even exists. And if they can show that they are saving a penny here, a penny there, it looks good to the bosses, even though the net result may actually be negative. As a result, many new people make many changes, often goofing things up, making things more complicated, or making things worse. Such is life at DL.
I’m not sure I understand the benefit to Delta for not allowing a +1 flying with a PM or DM to be eligible for Comfort+ at time of booking. What is the incentive for the “loyal” business traveler to fly for leisure on Delta? The only reason I can think of is if you get your tickets for free using SkyMiles. Otherwise, I can fly with my spouse on Southwest for a lot less money and have the same on board experience as I would on Delta. I would gladly pay for both of us to fly Delta if my spouse got to enjoy at least some of my PM benefits with me. Am I missing something?
@JL – Because Delta feels you are loyal when you are spending with them. They are loyal when they give you almost nothing free. See?
The thing about this that is ridiculous is that when my company is paying for me to fly full fare international business class earning 150% MQMs, my medallion status doesn’t really matter. I drink whatever I want, have my own lie flat bad with aisle access, I eat well, and I have access to lounges. I board as premium….It’s about who I choose when I fly for pleasure. And I’m more likely to choose the airline who has a hub near me, flights I can reasonably afford, and a fair shot at upgrades and amenities which are a reward for loyalty.
This is why I don’t like linking money to loyalty. Those who spend the absolutely most likely won’t need the perks.
My company wanted to start flying me United this year. I told them I would take a few connecting flights to stay Delta. There’s no reason for me to push for that if having status with Delta will mean nothing. And might as well close my Amex cards, too.
BIS matters, Delta! Argh!