This week, JetBlue announced that customers will have the ability to purchase points in the airline’s TrueBlue frequent flyer program.
As is universally the case with miles or points sold by the airlines, the prices are prohibitively high. For TrueBlue points, members will pay $50 for the minimum purchase of 10 points and $500 for 100 points. Factoring in the 7.5 percent federal excise tax and $20 transaction fee, the total price for those 100 points—enough for a free JetBlue ticket—would be $557.50.
More importantly, this “enhancement” to TrueBlue points out the program’s central weakness, which is that points expire after just 12 months. So unless a member is a true frequent flyer, there is a stark choice to be made: lose points to the harsh expiration policy; sign up for a JetBlue credit card from American Express, which extends the life of points; or purchase overpriced points to reach an award level before the points expire.
All of those options serve JetBlue’s interests, at the expense of its customers. If the points expire, it reduces the liability carried on JetBlue’s books. If the customer acquires the affiliated credit card, it assures future revenue from American Express, which will purchase TrueBlue points to reward its cardholders. And if the customer is forced to top off his account by purchasing points, that’s a highly profitable transaction for JetBlue and a dubious deal for the buyer.
All airlines must strike a balance with their mileage programs, which serve both as money-makers and as loyalty-generators. JetBlue has chosen to focus on the former, to the detriment of the latter. TrueBlue members are the losers.
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