OK this is a nerdy question: how do alliances work?

3 replies

DBPZ

Virgin Australia - Velocity Rewards

Member since 26 Feb 2016

Total posts 38

OK this is a nerdy question: how do alliances work?

DBPZ

Virgin Australia - Velocity Rewards

Member since 26 Feb 2016

Total posts 38

The question is:  different airlines in the same alliances have different policies on their high-level status membership. Some only require 20,000 miles to have prioritized services and lounge access, but the other can ask customers to fly 70,000 miles for the same privileges. To me, the airlines that are more lenient on giving out gold memberships are taking advantages from the others because the gold memberships from all the airlines are treated the same in the alliance. Is there a committee to review the policies or is there any cost (e.g. annual fee) to the airlines for granting a gold membership?

TheRealBabushka

Member since 21 Apr 2012

Total posts 2,059

Not a nerdy question at all. It's great that you've put some thought into it.

Each airline's FF programme is catered for its local market. Therefore the threshold for elite status is dependent on the market conditions of the airlines home base.

So to use Aegean as an example. The primary focus of Aegean is Greek domestic flights and intra-European flights. As such it was not unreasonable for Gold status with Miles&Bonus to require only 20,000 miles (someone correct me if I'm wrong). But it is expected that certain safeguards are built in to make sure the opportunities for "arbitrage" is minimised.

In this case Aegean didn't build in adequate safeguards and their programme got abused so much so that they had to change. I'm not sure if there is a committee but I'm certain anomalies are discussed and partner airlines are compelled to make changes to minimise abuse. 

That being said, the principles of competition remains in place, if for anything, to keep competition regulators at bay. I like to think of it as competitive independent tax policies adopted by states within a federation/commonwealth. 

anthony watts

Qantas - Qantas Frequent Flyer

Member since 29 Mar 2015

Total posts 15

To some extent alliances do this "matching the mismatched" with a seperate rating system. Hence in One World you are rated ruby, emerald and... spandex, or somethin else i dont recall. Now while i have platinum in Qantas, I have an american friend who is platinum with AA. His Platinum is Ruby in One Wold, Mine is a grade higher at emerald.

I am sure this isn't a perfect system, but it works.when flying AA and they see i am emerald, i seem to get exceptional treatment!

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