Airline credit cards are getting a very smart makeover

For more than two decades, airline credit cards offered consumers a simple formula: Spend a dollar, earn a mile, pay an annual fee, repeat. If you played the game correctly, you’d score at least a free ticket each year—just by making everyday purchases. The only issue? As powerful rewards cards such as the Platinum Card from American Express and Chase Sapphire Reserve began offering bigger perks and faster redemptions, airlines and their credit-card issuers got left in the dust. Add devalued frequent-flier programs—which began prioritizing dollars spent, rather than miles flown—and it’s easy to see why airline-sponsored plastic lost its luster. Enter the new generation of airline credit cards. They’re not for everyone—but this time, that’s the point. With new earning opportunities and perks valuable to both very frequent and very casual travellers, they’re an aggressive bid to attract new cardholders, retain existing ones, and cement loyalty among their fans. The first step in overhauling airline cards was to stop thinking about them as just airline cards and view them more broadly as travel cards. “When deciding what benefits to add, we have to look across the industry,” says Luc Bondar, United’s president of MileagePlus. That means adding earning bonuses for purchases beyond flights and catering more holistically to the frequent traveller. Story has more. <br/>