Southwest Airlines is making big changes to its Rapid Rewards frequent-flier program in a bold move to further differentiate its product brand and to lure more business travelers away from other major airlines.
The new Web site with details of the program has just gone up (at 5.30 a.m. Eastern) at www.newrapidrewards.com. Also, the head of the program, Ryan Green, has a blog post on the announcement at www.blogsouthwest.com.
Starting March 1, under a new system in which points are assigned based on how much is spent, members will be able to redeem points for every seat, every day, on every flight, with no blackout dates or seat restrictions. Also, points won’t expire over a 24-month time period in which there has been any activity in the account.
Points will be awarded based on the fare. The same is true for redeeming points.
Southwest is also adding a new elite-status level to its program -- A-List Preferred. And all members will be able to purchase points, in blocks of 1,000.
Southwest, which kept the announcement very hush-hush until 5:30 a.m. Eastern time today, said that members with existing credits and awards in the current program will retain their value until they are used or expire. Members’ accounts will automatically be transferred to the new program on March 1. There is no need to re-enroll.
NEW PROGRAM HIGHLIGHTS:
--No blackout dates.
--Every Southwest Airlines seat is a reward seat (no seat restrictions or capacity controls).
--Points don’t expire as long as members earn by flying or using a partner once every 24 months.
--Points are based on the purchased fare and fare product.
When the new program launches in March, members who have a Rapid Rewards credit card will also be able to redeem points for flights to more than 800 international destinations, plus hotels around the world.
This aspect of the program, however, is a lot less fluid, it seems to me. Southwest isn't actually partnering with international airlines. Instead, award tickets on international flights will be purchased by Southwest, essentially through a travel agency, at going rates, with points charged based on available fare.
Benefits for A-List Preferred, the new level of elite status open to A-List and Companion Pass members, include double points on fares purchased.
Southwest expects the program to generate "hundreds of millions in incremental revenue annually for Southwest, net of any associated program costs, to be fully realized over the next several years." Southwest said in an embargoed Webinar yesterday that it spent $100 million developing the new program.