Reader Teo writes:

I keep getting e-mail from Starwood telling me about their new feature that lets you book flights with your SPG points. They’re selling it like it’s the best thing ever. You think about this stuff more than I do icon smile Reader mail: Is Starwood Preferred Guests SPG Flights a game changer? so what’s your take? Is this the way to avoid the airline mileage BS or just a scam?

Indeed, Teo, Starwood Preferred Guest recently added a feature to their hotel points program: the ability to book flights directly from the SPG site, instead of converting points to airline miles and booking from there. The PR e-mails that landed in my inbox called SPG Flights “groundbreaking.” It was worth mentioning when it was rolled out in early September, as others did, but is it is really a game-changer?

 Reader mail: Is Starwood Preferred Guests SPG Flights a game changer?Let’s put one thing out there right up front: When it comes to programs that accrue points in a currency other than cold, hard cash, more redemption opportunities are always welcome. So hooray for that.

But…

The program works much like “no blackout date” credit card-specific point programs, most famously the Capital One No Hassle awards: You cash in your points for a plane ticket at the going rate for that ticket, and the market price of the ticket determines how many points you redeem. The program buys the ticket for you, as if you were paying cash, and you pay the program with your points. You’re not tied to one airline, and the only limit is price. The ticket earns miles, and is, for the most part, like any other ticket. (This is the “proprietary points” option in my breakdown of point-earning credit cards.)

What makes Starwood’s program different is that this arrangement isn’t limited to a credit card’s earnings. It’s the whole program’s earnings that can be spent this way.

But much like the Capital One style programs, the problem arises with the value proposition. The best you can get is 1.5 cents per point value. But it’s on a sliding scale based on the retail value of tickets, not the destination or distance flown.

The price-based scale will kill you if you want to use points for premium-cabin tickets, or even on flights to destinations that are priced higher — precisely the kinds of tickets you want to be using points or miles for.

Buy a first-class ticket to Australia from the U.S., for example, and it could run you 775,000 SPG points. Insane. That same ticket might be 145,000 using American AAdvantage points. Sure, the SPG program’s points pay for last-seat-availability, while the AA points are “capacity controlled,” meaning seats are limited. But is it worth more than 5 times the points?

I priced out a few flights to see how this would work in reality. In one case, I search for and found flights from the east coast to Hawaii. There were tickets available for 60,000 or 65,000 SPG points, depending on the airline. (I liked the fact that the search was similar to Expedia’s engine, and resulted in a list of various options on different airlines.) I then checked those airlines’ own frequent flyer programs: United and American had seats on the same flights, for 35,000 miles. Delta, Continental, and Northwest didn’t have availability on the dates I checked. US Airways told me my dates — April 7 to 14, 2009 — were more than 334 days in advance, so they couldn’t search for me. Umm, since US Airways can’t figure out that April is only 6 months away, not 11, I figured they’ve got bigger problems than competition from SPG.

Bottom line: SPG flight awards are a nice option to have, but they’re not the be-all end-all. The program offers flexibility, but it could cost you. You’ll find the redemptions for their hotel stays worth far more than this. Still: This is a nice reserve feature to have. I’m glad it’s in the hopper, but it’s nothing to go out of your way for.

Related:
- Reader mail: What kind of point-earning credit card is best?
- Reader mail: Can I use credit card miles to upgrade a ticket?

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One Response to “Reader mail: Is Starwood Preferred Guest’s “SPG Flights” a game-changer?”

  1. United unveils option to book hotels and cars with miles, but is it worthwhile? | Upgrade: Travel Better Says:

    [...] – Is Starwood Preferred Guest’s “SPG Flights” a game-changer? – Cashing in miles, but not on flights – Reader mail: What kind of point-earning credit card is [...]

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