Airlines offer tickets for miles instead of real money for many reasons. Marketing, Loyalty, Expiring inventory, and Demand are all reasons award seats exist. We take a look at each reason below.
Marketing: In order for airlines to compete they need to offer seats for miles instead of cash. If not they can only compete on price. They will lose out to the competition who do offer it. It also serves as another way they can market to you with promotions and fares only for their members.
Loyalty: Earning miles with a particular airline can help convince customers to come back. The basic idea is that you would earn enough miles eventually to get a “free flight” some day. Many airlines also offer benefits to frequent flyers such as upgrades and discounts once a certain amount of travel is completed. This can be based on distance and/or money spent.
Expiring Inventory: If a flight departs with empty seats the airline has lost a potential sale. By giving these empty seats to customers using miles they retain a customer who got a great deal. They also get the miles off their books (a liability in accounting terms) and have a happy customer.
Demand: When demand is low in off season or slow travel periods airlines tend to offer seats for miles. This helps prevent expiring inventory of empty seats and makes awards appear more available to their customers.
Knowing why seats are released for miles redemption can give you some useful information. It can help predict availability at the general level.
For example: Peak travel season to Europe is the northern hemisphere’s summer. Generally this is from May through August. These months will likely have the least availability using miles and points. It is generally more widely available the rest of the year. This can help you plan trips around availability and avoid disappointment.
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