Skift Take
It must be nice having such loyal and high-spending customers as Delta.
Delta Air Lines hit a nerve with loyal fliers when it upended elite status qualification in its SkyMiles loyalty program last month. Customers provided the carrier with ample feedback of what CEO Ed Bastian described as a "360 [degree] view" of the controversial changes.
One thing that Delta did not see? Any drop in bookings or usage of its lucrative co-branded credit card with American Express.
"We're not seeing any change in trajectory, rather, on acquisitions or changes in spend levels," Bastian said during Delta's third-quarter earnings call on Thursday. "Everything continues to stay intact."
The airline brought in $1.7 billion under its credit card deal with American Express in the third quarter. That represents 11% of Delta's total revenue – $15.5 billion – for the period. Delta President Glen Hauenstein said Thursday that the carrier remains on track for $7 billion in total credit card-related revenue in 2023.
That hits at the crux of the issue: Delta changed its SkyMiles loyalty tiers to reflect what it values most — money. And, while the blowback from the changes has been loud, if the revenue has not changed, the incentive for significantly rolling them back is minimal.
"We need to go back and reassess the planned rollout for the new qualification levels," Bastian said. He did not mention any further changes to, for example, access to its Sky Club lounges that the recent update restricted, particularly for credit card holders.
Delta plans to release the updated program requirements within "the coming days," he said.