American Express has announced the newest partner to their Membership Rewards program, which is Virgin America Elevate. They’ll officially be a transfer partner as of October 5, 2011.
There’s no doubt that Membership Rewards needs new partners to remain a leading program, given that Continental OnePass will no longer be a partner as of September 30, 2011.
Unfortunately Virgin America being added as a partner is about as useful as a class about how to let people finish taught by Kanye West.
While the exact details of the redemption rates have not yet been published, the issue is that Virgin America bases their redemption rates on the revenue cost of a ticket. That means there’s no way to get a great redemption value. A $1,000 ticket will cost you about ten times as much as a $100 ticket.
The reason this is an issue is because American Express actually has a “pay with points” option, through which you can book any flight, and the number of points it charges you is based on the revenue cost of the ticket.
So the redemption value through transferring points will have to be considerably better for this to be even a little bit interesting.
American Express really needs some new transfer partners. They should be talking to programs like US Airways Dividend Miles. Given that US Airways consistently sells miles for less than 1.5 cents each, I can’t imagine they would be opposed to a partnership with Membership Rewards, which I imagine would pay them a similar amount for points. I also can’t imagine that Barclays has US Airways by their you-know-what quite as much as Chase has Continental and United by their you-know-what, so I doubt they’d have the power to stop it.