A simple concept is the airline reward program. If you fly a lot with an airline, you will get a return in the form points or miles that you can use for future travel. It can be difficult to understand how many miles and how valuable these miles will be.
These reward programs are a major part of the airline business. According to a Securities and Exchange Commission filing, American Airlines AAdvantage members reportedly spent $1,220 per flight in 2019, compared with $408 for nonmembers. Airlines have strong incentives to reward frequent flyers with high-value rewards.
Customers have to understand the value proposition and how they fit together. It can seem overwhelming for many.
A survey of 2,150 Americans by Arrivia (a travel technology company) in December 2021/January 2022 found that 45% don’t know if their travel rewards are getting the most value.
You don’t need to do it all yourself. NerdWallet analyzed hundreds of data points from airline reward programs in order to determine which offers the greatest overall value. Frontier Miles by Frontier Airlines is the loyalty program for 2023.
Yes, an airline that is better known for its low fares as well as high fees has beaten out larger competitors such American and Delta Air Lines.
How did Frontier become the most valuable airline reward program of all time?
Miles flown, but not dollars spent
NerdWallet did a deep dive analysis of two key variables to determine the most valuable airline rewards program:
The number of miles you can earn through a program.
These miles are well worth it.
These were used to determine a “rewards” rate for each airline program. This is similar to a cash back rate.
You can expect to receive about $10.10 in value from Frontier Airlines’ top airline rewards program and $3.40 from Spirit Airlines’ bottom-performing reward program. The top performers include Alaska Airlines and Hawaiian Airlines, while United, Delta, and American are near the bottom.
You may be asking, “What’s the deal?” Spirit Airlines and Frontier Airlines both offer budget fares with no hidden fees. What is the difference between the two?
It didn’t come down merely to the value of these miles. Frontier miles are valued at 0.8 cents each. It didn’t matter how many miles you flew or the price of your fare, it was what really matters.
Alaska and Frontier were better at awarding miles based upon distance flown than airlines that awarded them based on money spent. Distance-based programs award more miles for every dollar spent on airfare.
Frontier is really the best? You might be right.
Frontier’s low fares are a key reason for its success. They allow flyers to earn more miles per dollar. Frontier offers 10 miles per dollar for every $200 spent on a flight of 2,000 miles. A $300 traveler would earn 6.7 miles for every dollar if they flew Alaska.
This is where things get complicated. Frontier charges more than Alaska for everything, from baggage to seat selection. These fees do not earn you miles on any of these airlines.
Frontier flyers will only get the best deal if they are willing to sacrifice basic amenities like a carry-on bag or assigned seat. These fees are essentially wasted in terms of earning miles and lowering the number per dollar spent.
Frontier’s elite status program is also worse than Alaska and many other airlines. There are other major drawbacks as the miles expire after six months of inactivity, which is a lot, considering that most airline miles don’t expire.
Yes, Frontier has the highest raw return value for dollars spent in miles. In practice, however, full-service airlines like JetBlue, Hawaiian, and Alaska — which are ranked 2, 3 and 4 respectively in our analysis — are probably better options. This is especially true for frequent travellers who want to take advantage of elite status and credit cards benefits or those who plan on spending money on ancillary expenses when flying Frontier.
What other considerations?
Distance-based programs are clearly better than airfare-based programs when it comes to the amount of miles per dollar spent. However, American, Delta, and United make up a large portion of the air travel market. They all offer spending-based programs.
How can a frequent traveler decide which airline reward program to choose?
Costco may offer the best value per dollar on many items but it’s not practical or possible for many food shoppers (who really needs that much cinnamon?) There are other factors to consider than just pure value. Ask yourself:
Which airline has the best flights from my airport?
Which airline has the best international partner airlines?
This list could go on and on. However, there is no one variable that will determine which airline is the best for you. If all the other factors are not a factor, choose the one with the better rewards rate according to NerdWallet analysis.
Maximizing your Rewards
A travel credit card should be able to prioritize what is most important to you. These are our top picks for the best travel cards in 2023, as well as those that work best for: