It is now 25 years ago that American Airlines chief executive Bob Crandall tentatively introduced the first mileage based airline frequent flyer programme to the travelling public.

On May 1, 1981, when the scheme first saw the light of day, there was no great fanfare from the airline and it seems at this distance that AA was unsure of its reception.

Mr Crandall need not have worried. The simplicity of the scheme – the accumulation of miles that could be exchanged for free tickets – proved so compelling it was only a matter of days before other carriers weighed in with frequent flyer schemes of their own, launching a dizzying spiral of offer and counter offer aimed at attracting the attention and retaining the loyalty of passengers.

Such is the success of the concept that there are now more than 130 airline mileage frequent flyer programmes throughout the world with an estimated 75 million people belonging to at least one scheme.

After a quarter of a century of one-upmanship amongst airlines jockeying for an edge, these schemes have become huge, with partner services often linked in allowing members to earn as many, if not more, miles from purchases of consumer goods on the ground.

All this may have masked the true benefits that can be derived by companies who participate in programmes that are tailored to their requirements and which operate across routes that form the core of the company’s travel requirements.

Delta Air Lines is one to have targeted the Small to Medium Sized (SME) market with its SkyBonus programme – a programme that would have particular benefit for companies with a principal dependence on transatlantic business travel.

Its operation out of the UK offers flights from London Gatwick to Atlanta, Cincinnati and New York, from Manchester to Atlanta and New York and from Edinburgh to Atlanta. From those US gateways the carrier connects to more than 160 destinations in the US as well as to 30 cities in 21 countries in Latin America and the Caribbean. The structure of Delta’s loyalty programmes also has the benefit of rewarding both the company and the individual traveller, with SkyBonus delivering points to the company and SkyMiles rewarding the road warriors.

This solves a thorny problem that has been pricking the corporate hide for many years – the question of who owns the frequent flyer benefits earned on business trips paid for by companies.

In some countries, Germany, for example, companies have no compunction about collaring loyalty programme rewards for use as a corporate benefit.

According to Verbrand Deutsches Reisemanagement, the equivalent of the UK’s Institute of Travel Management (ITM), an estimated third of German companies take the loyalty benefits their travellers earn on business trips. In the UK the convention is that the rewards go to the traveller, despite considerable grumbling from company accountants.

With the Delta set-up, travellers receive benefits that they would see as just reward for the disruption to family and personal life that business travel precipitates, while companies can generate savings in their travel budget by exchanging accumulated points for free tickets.

This twin-win programme not only helps smooth relations between employers and their business travellers but could also help keep travel planners and bookers in line with corporate travel policies.

According to ITM executive director Paul Tilstone, the pursuit of loyalty rewards is a major factor in leading business travellers off the straight and narrow path of corporate preferred travel partners.

“We did some research into compliance recently and found that as much as 20% of the UK’s managed travel expenditure was drifting outside corporate travel policies,” said Tilstone.

“The most important factor in this drift was increased access to different options offered by the Internet but the second most important driver in non-compliance was supplier loyalty programmes.”

It’s clear, then, that a considerable chunk of corporate money is being dragged off course by business travellers booking flights, hotels or other elements of their itineraries to suit their personal loyalty benefits rather than their company’s travel budget. And according to Tilstone, it’s often difficult to pin the errant traveller down, even if a company bothers to check on non-compliant bookings.

“It is very difficult to prove that any booking outside the travel management policy is not due to some mitigating factor such as convenient departure time,” he said. With this in mind, it seems that airlines that offer benefits to both the traveller and the company for the same miles flown will help keep the interests of both in line.

Mike Swindle is a freelance travel journalist. For more information on Delta's SkyBonus programme please click on www.delta.com/skybonus [1]