Frequent Flier Miles As Currency - The Neal Ungerleider Newsletter
Loyalty program deconstruction, Juneteenth, Walmart-Shopify & more.
Greetings from the Great Lakes.
(Image: United Airlines)
Argument: Using frequent flier miles is the coupon clipping of upper income brackets.
I was thinking about that when I heard that United Airlines got a $5 billion loan using their frequent flier program as collateral. The loan is a masterpiece of legal slight-of-hand, really: United Airlines doesn’t technically run its MileagePlus frequent flier program; rather, MileagePlus is technically run by a separate corporation called Mileage Plus Holdings, LLC. Mileage Plus Holdings appears to make money by selling its miles to others; Mileage Plus “sells” its miles to United at an extremely favorable price and to third parties like Chase (which operates United’s co-branded credit cards) at higher prices.
And, for crying out loud, weird business arrangements like Mileage Plus Holdings selling MileagePlus miles to United Airlines are pretty common in the corporate world—there’s an army of lawyers and accountants out there eagerly poking the…
Keep reading with a 7-day free trial
Subscribe to Context Collapse | Neal Ungerleider | Marketing, PR & Media to keep reading this post and get 7 days of free access to the full post archives.