It used to be that travelers could earn frequent flier miles mainly by flying frequently, which seemed reasonable enough.
Car rental companies and hotels chipped in as logical partners. Banks and airlines got together and began issuing credit cards that earned miles — one for every dollar charged. Nice synergy.
Today, guilt-ridden travelers can soothe their spouses and their consciences–and collect bonus miles–by sending flowers and calling home.
And speaking of homes: Buy or sell one through an American Airlines-approved real estate person and get miles for (start ital) that (end ital) — and (start ital) more (end ital) miles on the interest you pay an American Airlines-approved lender.
But why mortgage the house for a free ride to Vienna when you can eat your way there instead?
Today, feed your restaurant bills to American, Continental, Delta, Northwest, TWA, United and USAir and they’ll digest them into frequent flier miles.
Clearly, not all frequent flier dining programs fly equally. Some are free and easy, a pure bonus for choosing an affiliated restaurant; others will cost you money before the value kicks in, which means they may be of no value at all.
The rates of exchange vary, from Northwest’s two WorldPerks miles per dollar spent to the 10 miles per buck returned through programs operated by Transmedia Network and the Signature Group (Dining a la Card).
With all, the attraction is obvious and universal.
“A lot of people take their business clients out to lunch, dinner, whatever,” said Delta spokesman Kip Smith. “At the same time, they can build up their mileage.
“Other people just like to go out to dinner a lot. If you’re going to do that, you might as well make it pay another way.”
First, the basic programs.
About two years ago, American introduced the concept with AAdvantage Dining, and its deal has changed little since. Anyone belonging to American’s AAdvantage program can request a second card for diners (holders of “gold” and “platinum” cards, given to high-mileage clients, are automatically enrolled). Choose a member restaurant from its directory, enjoy a meal, hand over the card when you pay the bill and your next AAdvantage statement will reflect 3 miles for every dollar spent, exclusive of tax and tip. A $100 dinner, then, nets 300 AAdvantage miles.
That isn’t all.
“You can still charge (the meal) to one of the affinity credit cards (AAdvantage Master Card or Visa) and get an extra mile for every dollar through your credit-card charge,” said American spokesman Bill Dreslin.
That’s 4 miles per dollar. There also are bonuses, some just for joining the program and others for frequent use.
Everybody’s happy: The restaurants–there are 3,000 affiliates, including some in London–add customers, thanks to being listed in American’s directory. The restaurants, in turn, pay 15 percent of the dollars brought in by the cardholders back to American, which is fair for the airline.
The cardholder gets frequent flier miles.
Delta’s new SkyMiles Dining program, scheduled to kick in Aug. 15, will be similar to American’s–3 miles per dollar. Enrollment for Skymiles cardholders will be automatic, and its program will open with about 1,000 restaurants, Smith said.
Northwest’s WorldPerks Dining–which has only 125 participating restaurants–gives 2 miles per dollar. The sting of the low payoff is diminished by the fact that a 25,000-mile domestic freebie on most other majors costs 20,000 miles on Northwest.
But still . . .
“We expect to announce a new program by the first of the year,” said Northwest’s Kathy Peach.
Now, programs offered through the North Miami-based Transmedia Network and by the Signature Group, based in Schaumburg, are making inroads in the industry.
First, because it was first, Transmedia.
The company has three plans. Two are dining plans that offer rebates of actual dollars through approved credit cards. Sign up for a Transmedia card, designate a credit card, pay for a meal with the Transmedia card and the credit-card statement will show a rebate of either 20 percent or 25 percent (you chose the option) from the cost of your meal, less tax and tip.
The card that brings you a 20 percent rebate is free to you. The card that brings you a 25 percent rebate costs $49.95 a year–which means net savings don’t start until you spend $1,000 on food and beverage. But after that, you’re on your way.
The third Transmedia option is the one that brings you miles.
“This,” said Brian Kravitz, Transmedia’s vice president of business development, “is for mileage junkies.”
If you’re in United, Continental or USAir’s frequent flier programs and use the Transmedia card to charge a meal, each dollar spent will add 10 miles to your statement. An affinity charge card adds another mile, making it 11.
“They accumulate very quickly,” Kravitz said. “How hard is it to spend $100 on a dinner for a sweetie or a family? And you’ll have accumulated 1,000 miles.”
This plan, like Option 2, also has an annual fee: $9.95.
The best option?
Ben Blanco, marketing coordinator for Transmedia, suggested starting out in the free, 20 percent cash-rebate program.
“Mainly because there’s no catches,” he said. “You figure out how it works, you become accustomed to the program–and then you can go into the 25 percent program or the frequent flier program.
“Then, it really depends on the person. If you have someone who’s traveling constantly, the miles can mean considerably more (in value) than what actual dollars would mean.”
The Schaumburg-based Signature Group has two airlines in its system: TWA and United.
TWA’s Frequent Flight Bonus members can sign up with Signature’s Dining a la Card program and earn 10 miles per dollar at affiliated restaurants (both Signature and Transmedia claim about 6,000 restaurants nationwide). The plan also offers the option of a 20 percent cash rebate (by check) instead of miles; in either case, there’s a $49.95 annual fee–which matches Transmedia’s fee for its 25 percent program. The equalizer: With Signature, tax and tip are not excluded from the total that determines the rebates.
United’s Mileage Plus Dining is “Dining a la Card” by another name. Right now, only high-mileage Premier and above members are eligible, and the $49.95 fee is waived. This one is miles only. No cash rebates.
How is Dining a la Card different from Transmedia?
“The most significant difference is you don’t need to have a special credit card for us,” said Fanette Singer, staff executive at Signature. “You do for Transmedia.” Which means guests never need know you’re getting a rebate.
Another difference: With the Dining a la Card program, you can use the plan at a given restaurant no more than once a month, and the maximum monthly rebate from that restaurant is $120 (or 6,000 miles).
Another similarity: Unlike American, Delta and Northwest, which basically charge restaurants 15 percent in exchange for promoting them to their frequent fliers, both Transmedia and Dining a la Card/Signature are actually short-term loan companies for the restaurant business.
Bob Schulien’s family has owned and operated Schulien’s, a popular North Side neighborhood restaurant, for 110 years. He explained how it works.
“I go to them and I say, `I need $5,000 for a refrigerator,’ ” he said. “They say, `No problem,’ and they cut me a check. I, in turn, pay them back $10,000 in sales dollars.”
Sounds like a lot of interest.
“Yeah,” said Schulien, “but it’s short term, and it’s something we need.”
Schulien’s takes Transmedia, Dining a la Card and American AAdvantage. He said all generate customers.
“I had my biggest Transmedia month last month,” he said, and it’s a percentage of the take from those customers that pays off the Transmedia loan. Somehow, it works.
They also generate something else.
“I get a call once a month from somebody who wants to start their card here,” he said. “I’m like, `How many more cards do I really need? How much more confusing do I want to make it for my waitstaff?’ “
How much does he have to raise prices to pay for the miles and cover the interest on the loans? Are loyal patrons footing the kickback bill for newcomers brought in by these cards? Not really, Schulien said. It’s like buying advertising. Part of the business.
“We had a slight price increase about a year ago, but nothing major,” he said. “If you raise prices, you lose customers. It lowers my balance, but you know you’re damned if you do (use the programs), and I think you’re damned if you don’t.
“The question is, how high do you go?”
A question made for frequent fliers.
