For Delta Air Lines, it was a simple equation. Membership in its SkyMiles loyalty program has grown substantially in recent years—up 42 percent in 2022 from 2019 levels, carrier executives said in January—and now totals in excess of 100 million. But the availability of the perks associated with membership, including free flights, class of service upgrades and entry into Delta's Sky Club airport clubs, isn't infinite. With increasing demand and limited supply, something's gotta give.
"Everyone sees that the premium number of customers that we continue to build are in excess of the premium assets that we have to offer," Delta CEO Ed Bastian said in October during an earnings call.
Delta tried to square the circle in September with an announcement that, come Jan. 1, the carrier would make substantial changes to SkyMiles earning criteria and redemption opportunities. It would make Medallion Qualification Dollars—not miles or flown segments—the sole currency of status accrual. It also would restrict access to Sky Clubs for those who qualified via certain co-branded credit card programs.
While some frequent Delta travelers understood the carrier's predicament, many reacted harshly to the proposed changes. Delta in recent years hasn't faced much in the way of sustained negative feedback from its frequent travelers, and Bastian decided not to fully stand his ground, but didn't back all the way off, either. Citing the negative feedback to the September plan, the carrier in October lowered thresholds from its initial plan, loosened some Sky Club restrictions and added a handful of new benefits, still all taking place Jan. 1.
The new plan didn't make everyone happy but didn't result in open revolt, either, so perhaps a reasonable outcome for Delta and Bastian, making his fifth appearance on this list. Still, the SkyMiles affair may have had some downstream effects. A few other carriers in 2023 announced changes to their own loyalty programs, and some—Southwest Airlines, in particular—said they actually would lower the thresholds necessary for status. A quick strike to capitalize on Delta's travails, or coincidental timing?
The escapade also spotlights the cemented primacy of loyalty programs in the mind of frequent travelers, including business travelers. Carriers continue to load their loyalty leviathans with new partners from the travel industry and beyond, including branded credit cards, and limiting some perks—including free Wi-Fi—to members. Note Delta didn't back off its plan to shift its exclusive status-accrual currency to Medallion Qualification Dollars, which allow for accrual via purchases using Delta's co-branded American Express cards, through Delta Vacations and car rentals and hotel stays. The size, scope and complexity of loyalty programs show no sign of diminishing and should only demand more focus from corporate travel managers in the coming years.