Rapid Rewards, What’s Your Deal?

Back in February, Southwest posted the following warning to its website (my emphasis):

We created Rapid Rewards because we think you deserve to actually feel rewarded. And, from time to time we must make some updates to our program. Beginning April 17, 2015, the number of Rapid Rewards Points needed to redeem for certain flights will vary based on destination, time, day of travel, demand, fare class, and other factors.

That was a bit of a head-shaker. Southwest’s award prices are directly keyed to the market price of the airline’s paid tickets. And the price of paid tickets, as everyone knows, varies according to a multitude of factors, including destination, time, day of travel, demand, fare class, and so on.

In other words, what Southwest was planning amounted to adding a new layer of uncertainty to award pricing that already fluctuated according to the vagaries of the free market. No longer would Rapid Rewards members be able to compute the price of an award ticket by checking the published price of a paid ticket and dividing that dollar amount by the set value of a Rapid Rewards point, 1.4 cents when redeemed for Wanna Get Away tickets.

Henceforth, the price of an award ticket would no longer be predictable. It would be whatever Southwest says it was. Transparency, not!

Fast forward to today, several days after the dynamic pricing went into effect.

The good news is that in the random test bookings I made, the prices of some awards have gone down, resulting in more value-per-point redeemed. Other prices remained roughly the same. And still others increased, yielding closer to 1.2 cents in value for redeemed points. So the new pricing resulted in changes to the value of points ranging from a 35 percent increase to a 14 percent decrease.

But of course there’s no guarantee that that pattern will hold over time. Southwest could elect to raise prices across the board at any time, in the process significantly devaluing the points already residing in Rapid Rewards members’ accounts. Or not.

And that’s the really bad news: A program that was once lauded for its value and transparency has ditched both.

Reader Reality Check

Do you miss the old Southwest?

This article originally appeared on FrequentFlier.com.