I started this site to help those of you that are new to the points game. I don't want you to be overwhelmed by the terminology (see my Glossary for some terms and definitions) and I don't want to assume knowledge and leave you confused. So in case you find yourself not understanding even the base-level topics of this game, don't worry.
Take a deep breath. We're going back to the basics.
What is a Loyalty Program?
A loyalty program is a method for airlines and hotel chains to reward customers for patronizing their service. In general, they provide points or miles in return for stays, flights or miles spent by a customer.
If you stay or fly enough times, you will earn enough points/miles for a free stay or a free flight.
Wait, why would they give you a free flight or stay?
There are choices when you fly or stay at a hotel. The thinking behind these programs is the money an airline or hotel makes by getting your consistent business more than outweighs the revenue they give up for your free night/flight. They would rather give you something for free than lose your consistent business.
What do I get out of being loyal to one of these programs?
There are several upsides to pledging allegiance to an airline/hotel.
First, if you keep your stays/flights in one place, you will have enough points for a free flight/stay quicker.
Second, and most importantly, you can earn "status" faster.
Ok, I hear that term "status" all the time... What the hell does it mean and how do I get it??
While it's becoming increasingly more difficult to earn top tier status with an airline or hotel, if you are able to earn status at any level it makes travel much easier/rewarding.
You can earn status multiple ways:
Earn It - This is the traditional (and hardest) way. Every program affords customers the opportunity to earn status based on the number of flights/stays they pay for. Chances are, you won't be able to attain status this way unless you travel regularly for work.
Plastic - Many credit cards offer free low to mid-tier status just for signing up, or offer credits towards achieving status. For instance, Hilton's Visa Signature Card offers free Silver status, IHG's card offers free Platinum Select status, etc... This is the best way to achieve status if you're not a regular traveler. Premium cards like the American Express Platinum card offer higher end status like Hilton and Starwood Gold Status.
What Do I Get If I Earn Status?
Each program and level is different, but I can at least tell you what you'll be working towards.
Bonus Points - This is a small but valuable benefit as once you get status, it helps you keep it or earn the next highest level faster. Lowest end status will get you at least a 25% point bonus.
Upgrades - The holy grail. Upgrades are what you see and imagine when you hear about "frequent travelers" and they are what we're all working towards. Getting an upgrade is the greatest feeling in the world and it will help you get a kick-ass room for the price of a basic room.
Early Check-In/Late Check-Out: This is probably the 2nd most important benefit for me as I like to fly early and I hate dropping my luggage and "hanging out" for long periods of time. Usually you have to wait until 3pm to check in and check out is at noon, so if you can get in at 10am it makes a huge difference.
Smiles - Honestly, this is an underrated benefit. When you have status, your voice matters and people actually care about your happiness. Need that extra ice bucket? You get it faster. If you don't have status somewhere, you're a scrub and no one cares about you. I hate to say it, but if you don't have status don't expect anything.
So, as you can see, status is hard to get, but worth getting. It's important to establish your loyalty so that your money and hard work pays off.
Just make sure you pick the right program to start working towards.