Starwood Preferred Guest and Virgin America Elevate announced a new partnership today that allows you to transfer SPG’s Starpoints to Elevate at a 1-to-1 ratio. Because you can get 5,000 bonus points when transferring a block of 20,000 points, that means you could potentially earn as much as 1.25 Elevate points for each Starpoint.
I mentioned in yesterday’s comparison of Alaska Airlines and Virgin America’s loyalty programs that Elevate points are worth about 2.2 cents each, and they have the flexibility to be used for any flight without blackout dates. Starpoints are worth about 2 cents each, so getting 1.25 Elevate points for each Starpoint means you’re taking about 2 cents of value and getting 2.75 cents in return. It’s a good trade.
So what’s the problem?
I earn the majority of my points and miles through paid travel and regular credit card spend. I realize there’s a group of people out there who try to earn all their miles through other methods and fly for free. Which is fine. But I don’t believe it reflects the majority of travelers, and it’s the majority I’m writing for.
If you can afford to pay for most of your own flights in coach, it’s usually possible to earn enough miles for the splurge vacations in business or first class. These are the aspirational trips, the $5,000 tickets to Europe that most people would not pay for. Not the manufactured spenders, and not the majority of travelers, either.
I think it’s much more sensible to save your Starpoints for another transfer partner like American Airlines, Singapore Airlines, Alaska Airlines — whatever — and use them for an international award ticket in first or business class. Virgin has some international partners, too, but they collect hefty fuel surcharges on some award tickets that could make these redemptions a bad deal. There are many other airline loyalty programs that collect no surcharges or lower surcharges.
So I’m not saying that transferring to Virgin America produces a bad value. It’s fine. Especially if you want to fly coach on domestic routes. But you can probably afford to pay for that out of pocket. What I am saying is that there’s an opportunity cost here, and you could probably enjoy your Starpoints more if you transferred them to another airline for another purpose.
At the same time, you can now also take advantage of Starwood’s Airline Direct Deposit program to earn 2 Elevate points for every dollar spent at Starwood hotels.
Whether you agree or disagree with my comments above on the value of transferring Starpoints to Elevate, no one should use ADD. When performing a direct deposit, you’re giving up your Starpoints and choosing to earn Elevate points instead. You could earn 2 Starpoints per dollar, or you could earn 2 Elevate points per dollar. But if you choose to earn Starpoints then you’ll have the option to save up 20,000 and receive a bonus when you transfer them in one lot. There is no transfer bonus with ADD.