United Airlines escalates the credit card perk wars

Companies reserving special perks for their highest-paying customers isn’t new. Think of Costco’s Executive Membership giving those honored guests an extra hour to shop their warehouses before the Gold Star common folk can enter.

But United’s shift is notable because it’s holding out some previously universal privileges exclusively for cardholders, like frequent flier miles.

MileagePlus members who don’t have a United card will earn fewer miles for United flights than members who have one, United said in an announcement earlier this week. Other perks for cardholders include a 10% discount on every United award flight booked.

Meanwhile, non-cardholders will no longer be able to earn any miles when they book basic economy, which loses even more status.

All this underscores the airline industry’s focus on bolstering credit card relationships with its flyers.

Getting into the credit card relationship with cardholders — and the potential upsells — is big business. Premium customers are where the money is.

Last month, Delta reported that the money it generated from premium seats would outpace revenue from the economy cabin, making explicit the industry’s pivot to luxury and luxury-adjacent.

United’s program overhaul comes as the entire sector is pushing loyalty program memberships.

Redeemable miles, upgrades, airport lounge benefits, and other perks are helping drive more customers to buy flights using airlines’ co-branded credit cards, a substantial revenue stream for an industry that has struggled to profit from the actual business of selling affordable airfare.

American Express and Chase both recently revamped their high-end travel credit cards, showering their customers with a stream of goodies while upping the cards’ annual fees, which are approaching $1,000.