Buying points and miles, here's how to get bonuses from the 100%
We have talked several times about the possibility of buying points from airline or hotel chain loyalty programs, today [...]
Tap Air Portugal
British Airways
Alitalia
We have talked several times about the possibility of buying points of airline or hotel chain loyalty programs, today we want to offer you a sort of guide and give you a rough indication of when it pays off and when it doesn't.
Why companies sell points and miles
In this article:
The answer is the simplest, to make cash. In the midst of the pandemic, the loyalty programs of carriers and hotels are real sources of income, even the "derelict" Alitalia sees the Millemiglia program as one of the few profitable items, precisely because the points that Are given when shopping at the Coop, rather than with the rental of a car to those generated with the credit cards, they are points/miles That the company sells to the business partner.
One example? At the height of the pandemic, in July American Express renewed its partnership agreement with the IAG Group (British Airways, Iberia, Vueling) to issue branded credit cards. The basis of the agreement saw a payment of 750 million pounds, about 850 million euros, against the sale of point Avios that will be turned over by the finance company to its customers.
Here's where airlines for years have been trying to entice their frequent flyers by offering opportunities to buy points/miles in order to get the amount needed to detach an award ticket faster.
How much are miles or points worth
Let's start with a value that all American Express customers know, 1,000 Membership Rewards points are worth 4 euros If converted to the option that allows Reversing charges from the bank statement With the use of the points earned. Conversely, if the same 1,000 points are used to obtain airline tickets can get to be worth even more than 10€..
Regarding the value of points from hotel chains or carriers, we can imagine that they are separate currencies, and each currency has a different value that varies depending on how it is used.
In general, we can clarify that hotel chain points are worth much less than airline points, partly because they are easier to earn. For example, both Hilton and Marriott recognize a minimum of 10 points for every dollar spent and at the same time require fewer points to get a hotel night than the points/miles required for a free flight.
Because there are so many offers at this time
Again, the answer is very simple: companies need to make cash. Since the outbreak of the pandemic there has been a succession of more or less interesting proposals to convince consumers to buy points/miles that will then be used (when?) in future trips.
In the case of hotels, for example, most large chains have many franchised facilities. For Hilton then it is a double gain because it manages to sell the points to the user at a higher price than what is paid by the franchiser and at the same time, the points used to pay for the room recognized to the same franchiser will be much less than what the guest actually pays. All while perhaps collecting money years in advance for rooms that will be booked who knows when.
In the case of airlines, the game is even more subtle. There is no franchiser, but the possibility of the user buying miles with, for example, Tap Portugal and then booking an award ticket with Lufthansa. Added to this is the fact that airline miles have a much stricter expiration date, with the risk that if not used they will be lost.
Is it worth buying at this time?
As mentioned, we have seen some interesting promos, such as the opportunity offered by Finnair to also get the status along with the miles. Therefore, it is necessary to evaluate well not only the offer but also the timing and rules of each individual loyalty program.
In the Italian market, there are not great opportunities to earn points through credit cards, which is among the cheapest and most convenient precisely because they are given to the user against charges and not for a fee. So for those passengers/guests who need to fill a gap to reach the amount needed to book a stay at a hotel, it can be convenient to buy points/miles.
In this historical period, it is also important to take into account the possible critical situations of the airlines, buying Alitalia miles today could be a risk since one does not know the future of the company and could end up with waste paper in case of program devaluation or bankruptcy of the airline.
One of the important factors to take into account is also the exchange rate, since the value of points/miles is often priced in dollars. In a "strong euro" situation it can lead to an additional gain; conversely, it can mean a deterioration in conversion.
Buying points in hotel chains
Right now there is a promo Hilton honors which offers a chance to get a bonus of 100% on points bought.
The current promotion allows you to buy up to 80 thousand Hilton Honors points and receive as many bonus points. All at a cost of 800$, or about 660€. It would mean that 1,000 points would cost 5$ instead of the canonical 10.
Buying airline miles
This practice is active all the time, what changes are precisely the bonuses that are awarded to members of loyalty programs.
Here are some current offerings:
Alitalia does not offer a bonus but applies a discount on the cost of miles. Normally 2,000 miles are worth 50TP. The discount varies from 5 to 20% depending on the amount of miles you want to purchase. It is good to remember that AZ, in order to detach an award ticket, requires at least 25% of the miles needed to be earned with Alitalia or MilleMiglia Partners, while the miles purchased can be used up to a maximum of 75%. For example, you can claim a 40,000-mile award using 30,000 purchased miles and 10,000 earned miles.
British Airways right now offers a bonus of 30%, the maximum allowed each year is 200k Avios. In this case you would receive only 60k Avios at a cost of 3,600.
Tap Portugal launched a promotion, yet another, that proposes to those interested in buying points: up to 18k points you will receive a bonus of 100%, beyond that you will receive a bonus of 200%. So buying 20k miles at a cost of 700 will receive 60k miles&go points.
In conclusion
No offer is phenomenal, perhaps only Hilton Honors points are attractive due to the fact that with "only" 660€ one could accumulate 160k points to use without anxiety of expiration in the coming months/years and without fears of losing them.
