When Alaska Airlines shared the other day that they’re celebrating their 90th birthday by giving each employee 90,000 Mileage Plan miles I passed on this news and joked that they were helping their employees learn how difficult it has become to use their miles. There’s a certain truth to this, and it’s actually to the airline’s benefit!
Alaska is hardly the first to give miles to employees, even recently. For instance,
- Southwest gave 50,000 Rapid Rewards points to employees for their 50th anniversary last year. Then they offered miles as a reward for attendance between the Thanksgiving and New Year’s holiday travel periods.
- American Airlines included miles in severance packages for managers as they tried to convince employees to leave during the pandemic.
But Alaska Airlines, in giving 90,000 miles to employees to celebrate their 90th anniversary, is making a uniquely smart move that helps enhance the value of the loyalty program, offers a leveraged way to make employees happy, and improves customer communication about Mileage Plan.
- It’s cheap to do even a scale, since Alaska’s ‘cost’ for 90,000 miles is almost certainly less than $750 per employee. Four years ago Alaska (and many other airlines) handed out $1000 per employee bonuses prompted by the Tax Cuts and Jobs Act of 2017.
- Employees will value the miles at more than they cost, just like customers do 90,000 sounds like a lot, much more than $750. Indeed the leverage in miles is that customers can redeem for travel worth far more than the travel costs the airline to provide. The gap is widened further for (1) saver awards (2) in premium cabins.
- Engages employees directly in the program most employees may be aware of the program don’t don’t know much about it, perhaps vaguely. It’s a huge revenue driver for the airline in addition to being a key tool to keep customers flying them.
- Introduces employees to the airline’s partners and routes. If you call Delta there’s a good chance the agent may think Air France is their only partner or ‘the only member of SkyTeam’ (something I’ve been told many times). It helps for employees to know who Alaska partners with, and helps promote those partnerships with customers, for them to engage directly figuring out where they can use there miles and on which airlines.
- They can become salespeople for the program, encouraging customers to join and engage once they know the product directly, and have traveled with it, they are more likely to be Mileage Plan evangelists – and since the program is a revenue driver that’s good for the company.
- And give critical feedback often feedback from employees is heard loudest. With employees as experienced users there may be more of a chance for improvement.
All employees should be experienced in the loyalty program since the loyalty program is core to the business. That includes revenue management, who might be more amendable to offering better award inventory if they combine an understanding of the program’s value to the business and experience with the challenges redeeming miles as a user.
Giving 90,000 miles is a lot of value, albeit at modest cost per employee to the airline. And while it alone can mean award travel the best use of the miles is adding to them for higher value partner awards around the world – especially on some of Alaska’s longest-standing partner airlines.
