Of course this makes me wonder about how the exploited companies respond. The exploiters can be identified (are companies afraid of lawsuits and public defamation)? Is such a story like an advertisement that may make someone (a reader) slightly more likely to use Avis (in this case) in the future?
About 75% of points get redeemed (since people who get a lot would tend to use them), so the total cost of a ticket if everything was redeemed might be around $64/.75 = $85 USD.
Seems like tickets range in cost, but 50k seems a fair estimate of the average flight (probably a bit high). So $0.0017 per mile incremental cost (higher opportunity cost).
This INCLUDES all the people gaming the system right now, though. And Avis is paying the airline for the points, so the airline wins no matter what happens — it's a billion+ dollar profit center for them. Avis might be a bit more annoyed.
Well, they usually have corporate sales reps hammering out the particulars for big promos like this. Avis is certainly paying the airlines something, but as the size of the buy is enormous, they're going to get somewhere south of the wholesale price on the miles. Both parties therefore are eating the cost of the abusers.
I booked a ~£400 return flight from the UK to the States just a few weeks ago and the airline claim to be only getting 40% of that. I'm not sure where fuel fits in.
The price difference was all tax - and lots of it!
It makes one wonder what marginal meetings are _not_ taking place because the 50% taxation (the fault of both port operating companies, state governments, the U.S. federal government, and their equivalents on the European side) makes it infeasible for those who are ever so slightly less fortunate.
Imagine the cost of travel -- and of interpersonal connection -- being halved because these taxes went away. Who's to say it's better to hire another Social Security Administration Vice President than it is to enable a CRISPR researcher at Stanford to meet a pharma exec in London?
(You might think that government would grind to a halt. . . but of course government only spends a paltry percentage of its winnings on things like transportation.[1])
"Because the airlines sell the frequent-flyer miles to Healthy Choice for the promotion for about two cents a mile, they aren't out a thing. Healthy Choice likely also made on the deal, because the value of the publicity surrounding Phillips' pudding run probably exceeds the actual dollar cost incurred by the company for purchasing those miles."
And of course that also can be gamed through mileage runs, where you simply spend some time searching for cheap long-distance fares on the airline or one of its alliance partners, and use that to rack up extra qualifying miles. Which in turn has led to countermeasures from the airlines: ultra-discounted fares on partner airlines often earn only a tiny fraction of mileage flown, and two of the three US-based legacy carriers (Delta and United) now also have a minimum dollars-spent requirement in addition to the mileage-flown requirement.
Largely this is because the miles themselves, as an alternate way to purchase airline tickets, are not much of a hit, but the status perks are. Airlines do some interesting balancing acts in terms of wanting to attract people who fly a lot (and thus spend money on tickets) vs. not wanting to be so top-heavy with people entitled to free perks that you end up losing money on them.
Used to be, $25k spend would convert 10k miles to US PQM. Now, $20k spend converts 5k miles to AA EQM, and you can do it twice a year (so max 10k conversion from $40k spend).
The former US Airways "Premier World" card would convert 10,000 of the (non-qualifying) miles it earned into qualifying miles, once per year, when you hit a total of $25,000 spent on the card in the year. The lowest status tier required 25,000 qualifying miles.
The current American Airlines "Aviator Silver" card, which is what the US Airways card rebranded as in the merger, will convert 5,000 miles to qualifying miles when you hit $20,000 spent, and another 5,000 miles when you hit $40,000. The lowest status tier requires 25,000 qualifying miles.
The Delta "Reserve" card will convert 15,000 miles to qualifying at $30,000 spent, and another 15,000 miles at $60,000 spent. The lowest status tier requires 25,000 qualifying miles.
The only other non-flying method of earning qualifying miles that I've seen in this decade was an occasional promotion US Airways would run, offering 5,000 qualifying miles for buying or renewing a lounge membership. It was not offered last year, and probably will not be offered this year.
Note that airlines will occasionally allow you to buy your way up to the next status tier if you're within a certain range, but that typically doesn't actually deposit miles into your account: you just pay the fee, get the higher status, and that's that. Last year, American Airlines offered a flat-rate buy-up if you were within 15,000 miles or 15 segments of the next tier, for example, so at 85,000 qualifying miles you could have paid a couple thousand dollars to buy up to Executive Platinum status.
> You will earn 1,500 Tier Qualifying Points (TQPs) for each $10,000 of eligible Net Purchases.
> Maximum TQP accumulation is 15,000 points per Year, which equates to $100,000 in Net Purchases.
https://creditcards.chase.com/credit-cards/southwest-credit-...
TQP = A-List Points
So I think you are confusing the per-$10k number with the cap per year.
Yeah, you aren't going to spend $100k on the card, but you might spend $20k in a year.
Also slightly related: nobody pays for first class on domestic flights. Everyone up in first class is normally a frequent flyer (they tell you when you check in if you got an upgrade).
Also, on the big three carriers (America, Delta and United), upgrades get processed multiple days out depending on your level of status. Currently as Executive Platinum on AA, I can be upgraded as early as four days out from the flight. I'm actually waiting for the email right now to see if my upgrades will clear for a couple segments later this week.
* Free (capacity-based) upgrades to first class on domestic flights
* Buying a full-fare economy-class (rather than discounted) ticket auto-upgrades you to first class at time of purchase
* Free checked bags
* Free access to exit rows and other extra-legroom seats
* Discount on lounge membership, and free access to lounges when you're departing internationally
* Priority customer-service access
* Waiving of lots of fees (for things like last-minute flight changes)
Moving up through the status levels, the perks have a tendency to get pretty nice; I've done multiple flights to/from Europe where I paid for an economy-class ticket and upgraded into business class for free, for example. I've also had access, regardless of fare class, to the fancy international lounges (most recently, had a shower and a hot breakfast after an overnight flight into London a couple weeks ago).
I'd be happy to go to prison if it meant I got free massages in a spa[1] or chauffeured around in a Porsche[2].
[1] http://travelsort.com/blog/thai-airways-first-class-lounge-a...
[2] http://upgrd.com/regionalfirst/the-best-lounge-in-the-world-...
I can't remember exactly what it's called - I assume it has to be an "obvious" error.
Sometimes companies honour the error for PR reasons, there was a John Lewis situation I think where they did this recently.
Advertised prices are "invitations to treat" rather than binding contracts of sale.
Ah - precisely - I'm so glad you brought that up. If only more people understood this simple principle!
You're right though, frequently honoured for good PR - it's rare that an item going through checkout at the 'wrong' price perhaps due to an expired offer is not adjusted.
This prevented, explicitly including the case of "mistake" fares, the post-purchase increase in the price of airfare. This was done to prevent airlines from post-facto declaring a promotion a "mistake" when deemed "too successful" later.