Airline loyalty programmes are famously big business – but how much do you actually understand about how they work?

It should be a straightforward process – picking a credit card, spending at the right times and being rewarded with points to redeem for a dream trip – but it’s not always that simple.

Point.me, an airline point concierge service which assists with reward bookings, has attempted to lay bare the world’s best airline rewards programmes.

It’s released a report, ranking 62 of the world’s airlines, drawing on information released by the companies, as well as years of its own data.

The company considered a number of factors including redemption rates, ease of booking and customer service quality.

It revealed that the world’s top-ranking rewards programme is Air France and KLM’s joint Flying Blue.

It came in first place thanks to its ease of booking and the relatively low cost of redemptions, as well as the ability to book on the companies’ partner airlines, within the SkyTeam alliance.

How do airline reward schemes work?

Airline rewards or frequent flyer programmes allow passengers to collect points as they spend which can be redeemed as discounts on travel.

You might think that the majority of the points travellers earn and spend on flights come from flying – but that’s actually not the case.

While you can collect points based on distance flown by signing up to a specific airline’s programme, many carriers partner with credit card issuers to offer points on a wide range of travel-related spends.

The majority of reward points are earned through such partnerships, meaning that some airlines earn significantly more through credit card deals than they actually do by operating flights.

It isn’t just airlines who are the winners, though.

The fact that most of those points are earned through credit card programmes means that  travellers don’t have to be frequent flyers to earn points they can leverage for travel.

How were the best rewards programmes selected?

If you spend wisely – and make sure to pay your credit card off in time – the rewards can earn you serious discounts.

As with everything, though, there are downsides and, for ordinary travellers without specific knowledge, it’s often near-impossible to decipher which programme is right for you.

To make things a little simpler, Point.me looked at various criteria, including how easy it is to earn points from non-flying methods – think dining and shopping, package holidays, transfer partners and transfer bonuses.

They also examined the value it’s possible to get for those points, how easy it is to book an award flight and the frequency of award availability.

On a more complex level, there’s flexibility in routing rules to consider – that is if you can book a stopover, for example, as well as change fees and policies – and customer service quality when it comes to booking.

Here’s what they found out.

Which airlines have the best rewards programmes?

Flying Blue, the loyalty programme for Air France and the Dutch flag-carrier KLM, proved that Europe knows what it’s doing when it comes to rewarding customers.

Point.me says the programme has exceptional performance across the board, receiving top marks in nearly every category.

Recently, Flying Blue has made significant adjustments to its loyalty strategy, which has led to good redemption rates and extensive partnerships that make it easy to earn miles – even without ever boarding an Air France or KLM flight – as well as flexible routing rules that make it easy to reach destinations worldwide.

Fairly unusually, customers are able to transfer points from all of the major credit card points currencies to Flying Blue, which makes it relatively easy to amass enough points for a flight even if your spending is spread across loyalty programmes.

Following Flying Blue is Air Canada’s Aeroplan programme.

Revamped in 2020, the Canadian company offers solid availability on partner airlines as well as generous routing rules which make it easier for travellers living in non-hub cities to use its miles.

Points from most of the major credit card programmes can also be transferred to Aeroplan.

Point.me did find that there were a number of challenges with booking some flights online, including long hold times, and slightly less impressive customer service than other programmes.

United MileagePlus, the US-based programme, may have received some negative attention recently for changes that make it less lucrative for very frequent flyers to be loyal to the airline. But Point.me found that the overall structure also makes MileagePlus one of the best for non-loyal or less-frequent travellers.

Points can be transferred from a number of other loyalty programmes and it was found that MileagePlus miles are easy to earn through a host of partner and co-branded credit cards.

Point.me also added that the company has implemented dynamic award pricing in a way that can actually be beneficial to casual travellers – particularly those tied to school schedules and national holidays.

Two more European programmes made the top five

Back in Europe, two UK companies came in joint fourth place – British Airways and Virgin Atlantic.

British Airways was praised for the extensive changes to its Executive Club programme in the past year. The expansion of its ‘Reward Flight Saver’ concept to long-haul flights, which allows travellers to redeem points at attractive rates with vastly reduced fees compared to prior versions of the programme, was hailed by Point.me.

As well as offering the ability to transfer points from other programmes, the Executive Club charges separately for each ‘segment’ on an itinerary – with pricing based on the distance of each flight.

Simply put, that means it’s possible to find solid options to and from hub cities. It does fall down, however, on connecting itineraries, especially when combined with hefty carrier-driven surcharges on non-Reward Flight Saver trips.

Virgin Atlantic Flying Club has similar pros and cons.

It was found to have some of the best economy redemption rates of all programmes Point.me evaluated, as well as a commitment to making seats available for award redemptions on every flight.

While the Club also partners with a wide range of credit card reward programmes, carrier-imposed fuel surcharges are extremely high in premium cabins, which is a black mark against Virgin.

Also, Point.me found that some partner bookings need to be made over the phone – and the Flying Club website doesn’t always make it clear when this is the case.

It was praised, though, for its keenness to offer space on flights that travellers tend to be most interested in – think economy flights from New York to London and back for under 9,000 points per person each way, with availability for entire families or larger groups, as opposed to individual seats only.

Which other European airlines offer the best loyalty programmes?

While Point.me tended to focus on the benefits of the programmes for Americans, it also focussed on a wider variety of companies’ reward schemes within Europe.

As well as the aforementioned Air France / KLM’s Flying Blue, British Airways Executive Club and Virgin Atlantic Flying Club, Aer Lingus’ AerClub and Finnair Plus rounded up the top five best programmes in Europe.

Up next was Aegean Miles+Bonus, which was praised for offering expanded availability on its own airline.

Scandinavian SAS Eurobonus was found to offer availability on its partner airlines, while Miles & More, by Lufthansa Group, was discovered to have impressive ease of booking.

Iberia Plus and Tap Miles&Go both make it straightforward to redeem points on a flight booking, rounding out the top 10 in Europe.

Turkish Airlines Miles&Smiles and Air Europa Suma both scored fairly averagely on the global scale but, in Europe, came in 11th and 12th place respectively – meaning they offer a number of perks other companies can’t.