The Hidden Economy Behind Loyalty Programs
<p>Did you know that the biggest buyer of airline miles are credit cards and the banks that issue them? Year to date, 6% of Alaska Airlines’ operating revenue is from selling miles to credit card issuers.</p>
<p>When you dig into the numbers it becomes even more interesting. Year to date, Alaska has generated $7.4 billion in passenger revenue (tickets, amenities, and luggage fees) and accumulated $7.5 billion in operating expenses. That means without its mileage plan, which generated $483 million of nearly pure profit, Alaska would have been operating at a $100 million loss rather than a $362 million operating profit over the first 3 quarters of 2023.</p>
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