Frequent-flier programs are becoming more sophisticated but most of the work is going on behind the scenes and passengers may not know just how closely the airline is tracking their movements.
Some people argue that frequent-flier programs are an unnecessary expense for airlines and are just an excuse to pad their fares. This misses the whole point: when operated correctly, they offer an extremely cost-effective way of tracking and keeping in touch with their best customers. They work as a form of electronic tag for travelers with the traveler being given occasional free flights as a reward for giving the airline their travel information.
If an airline sees that a passenger travels regularly to Nairobi and is introducing a new service on that route then this is a perfect way of communicating with the customer at very little cost to the airline. If the airline is really clever, it might have noticed a passenger has used his card to stay at a hotel in Munich but has never flown with that airline to Munich. A personalized special offer (reduced fare, extra Miles or another bribe) could gain the airline a new customer.
Most of the time, this is a perfectly reasonable trade. The airline gets the information and the traveller gets the free flights and some extra benefits. A win-win situation.
The downside comes when you may not necessarily want to be tracked. This is particularly the case if you work for a company and travel on business. You may think you have a Gold Card with airline X, but if the airline has seen you booking flights through a company agent, and that company is one of its corporate customers, then it will have you listed as an employee of that company. It is quite likely that they will send monthly reports to the company detailing your travel that could well form the basis of some corporate rebate scheme. If you pay for a couple of flights for a holiday, there is no harm in the company knowing about this; but what if you decide to fly to New York (at your expense) for a job interview with another company? If you leave your current employer, your old company will still be told about your travel until you tell the airline you have moved.
Remember that Jonathan Aitken went to prison for perjury when it was shown he was in Geneva at a time he claimed to be elsewhere. Records from British Airways were used to show that he had hired a car there and used his Executive Club card.
Frequent-flier programs have existed for many years and have not changed very much. Not all airlines are as good at tracking their customers as they could be but the ones that are best (generally the world’s leading airlines) are now adding new layers to the information they keep on customers and how they use it.
British Airways has developed a confidential point-scoring system, which involves all cardholders being given a rating from 0 to 100. This means there are travelers with Gold Cards who have a higher status than other Gold Card passengers. In this system, status is gained not just by flying but also by the overall commercial importance of the employer. These scores are not visible to the traveler, or to many airline staff, but they can be seen and used by senior check-in staff (the people who decide whether someone is upgraded or has to be off-loaded because of over-booking).
Other airlines have quietly begun adding other items to the data they keep. It is normal for airlines to keep seating preferences on file but some can now add such items as favorite drinks and even the type of film you want to watch. There is a thin line between knowing enough about a customer to give the best service and knowing too much personal information – especially since you are unlikely ever to be told what information the airline is keeping.
We are great supporters of frequent-flier programs, but you need to be aware of their downsides. There could be occasions when you would prefer to travel anonymously, in which case it is probably best to use another airline because your regular airline may well track you, even if you do not quote your card number. If you leave your current company, you really should tell the airline and ensure it notes the change.