Do you want a one way ticket, or at least two round trips?
We live in a time of buzzing trends and scarce originality where everyone is competing for increasingly fickle eyeballs. With all the distraction, It’s hard to think of something that keeps eyeballs in one place more than jaw dropping luxury travel experiences.
When you tell people it’s all “on points” the collective audience jaw almost reaches a permanent, locked position. “I want that” is the typical feeling as people consume the points content — and many people shift behavior to join the points and miles world in pursuit of experiencing these things for themselves.
TL;DR: Mind blowing luxury travel experiences are a stellar “made you look” to sell the dream. As points prices rise higher than inflation though, it’s increasingly important to consider your own dreams, and how bucket list luxury redemptions compare in value versus more long tail opportunities.
A One Way Ticket Or Two Round Trips?
For a myriad of reasons, many of the luxury travel experiences unlocked with points have seen significant “devaluations” in value or inflation in price, depending on how you like to look at things.
Loyalty programs are a tight rope balance between creating aspirational value and opportunity with points and all while maximizing the profitability and uptake of airlines and hotels.
What that’s created is an even more significant gulf between the number of points required for more “everyday” things and the wow factor luxury experiences on offer. Points pricing for flights used to be a number of points for economy, circa double for business and triple for first, but even those figures have become distorted.
In many programs, more economy style redemptions have actually gone down in points price with greater availability while the luxury side of stuff has gone up. You might be paying 5x the points for that wow factor first class flight, or more.
Utility Versus Utopia
This all begs an important sanity check. I love Emirates First Class, Singapore Suites or any of the splurge experiences more than most, but the opportunity cost of one of these is significant versus taking more trips, or at least an entire round trip.
Most people have a finite number of points and limited ability to constantly take on new cards. A first class flight with all the trimmings and “YOLO” built in is tough to pass up o, at least once in life — but so is being able to travel over and over again.
Earning enough points to do these first class flights just once is an endeavor, so most people must weigh the benefit of ticking off a bucket list luxury item ‘one way’ for the experience versus unlocking at least two “free” round trips in a standard cabin, for the same amount of points.
When you consider things like family travel the equation gets more complicated.
And Hotels Too
After years of outsized value, the gloves are mostly off with luxury hotel redemptions using points too. Previous caps on the number of points for high end properties are gone in many instances and those programs which still have charts have had the point ceiling raised.
On the budget hotel side of things, not much has changed though. It’s rarely an incremental number of points to jump from budget to luxury like it used to be, but a multiple of points. So do you want one night for 100,000 points, or a weeks vacation paid for with your points for 100,000 points.
There’s no wrong answer.
Eyes Open, More Scrutiny
I still mainly redeem my points and miles for luxury focused experiences. Comfort is a defining factor in my pursuit of these loyalty currencies and the volume of my organic travel means that my points banks are being constantly replenished.
With eyes open, I choose the higher points prices and luxury experiences because I know more points are always around the corner. I’m lucky to have the means to travel anyway, which is also a factor. Points for me are about improving journeys I’ll take either way, whereas for some people they’re the difference in going, or not.
As financial services companies like credit card providers limit card bonuses to once a lifetime, or other ways to inhibit gaming or churning of offers, the endless stream of endless points is likely on borrowed time.
Quite simply, this means many people who don’t share the same level of organic travel or who don’t have high levels of organic spend must start to look at their loyalty points with more scrutiny as to the assets.
There’s no wrong answer as to whether you’d rather use your points for caviar and vintage champagne in first class one way, or for two round trip economy flights — it’s just good to consider that sometimes more is more, and as brag worthy as some of the first class experiences can be, they’re not always the most useful if you can’t get home.