Today I’ll discuss why the most expensive miles you’ll earn are the ones you get by flying.
Just for fun I thought I’d run the numbers to see how much a standard mileage run costs. I’ll be using the $900 Delta mistake fare from GRU for my math.
GCmap.com, one of my favorite websites, has the route at 11,028 miles. I’ll round down to 11,000 for easier math. And we’re buying this fare for $900 (in business class). You should receive 150% of the miles flown because it is a business class fare (16,500) . A fantastic deal to earn miles both Elite Qualifying and Redeemable miles, right?
$900 divided by 16,500 miles = 5.5 CPM.
Except that doesn’t include our time. The flights alone, including layovers, are 16 hours in one direction. Then there’s at the very least a 10 hour layover before flying back. Then another 16 hours of flying.
Total time spent on this adventure: 42 hours. Now, not only does that just sound awful, it eats up a ton of your valuable time. You’ll know from the post on T-rates that for Milenomics our time is worth a certain amount of money. At my relatively low T-Rate of $25/hr I’d add $1,050 to that $900 fare price. If your T-Rate is higher than mine it makes even less sense for you.
Our new calculation of CPM is:
$1950 Divided by 16,500 = 11.8 CPM. Not good.
This entire exercise also assumes you somehow got to GRU in the first place, since the mistake fare was from GRU-NYC, not the other way around. So add in the time spent on a positioning flight, and another to get home from GRU, and you’re looking at a solid 80+ hours spent on one of these. 80 Hours @ $25 an hour is $2,000.
Let’s update again:
$2900 Divided by 16,500 = 17.6 CPM
This assumes you can somehow get to GRU for free. You’ll likely need to either pay $ or Miles to get there, neither of which are free. So we’ll need to add the cost of the miles as well into this. I’ll stop the calculations here, but as you can see, it just doesn’t make much financial sense. You’re a little over half way to Delta Silver Medallion (or Alaska MVP), but at a cost that you’ll likely never see back from either of those status levels.
The truth is, airplanes just don’t fly fast enough for our mileage earning needs.
Lets flip it around; In a plane flying at 530 MPH you’re earning 530 miles in one hour. If the flight is 10 hours long you’ll end up with something around 5,000 miles for it. Divide your T-Rate by your speed:
$25 per hour divided by 530 miles per hour = 4.7 CPM
Even if flights were free (which they aren’t), and you traveled at maximum speed all the time (which you don’t), 4.7 CPM is just far too high a price for me to pay for these miles.
Now in certain, very, very specific cases maybe a mileage run might be in order–and certainly if you can create a run that allows you to do something you’ve wanted to do that might mean you can discount, or even eliminate your T-rate from the equation. However those specific cases would really only affect a Milenomics #401 traveler. If someone else, either your company, or your clients, has paid most of the way to your elite status you may want to put the final flight together and pay out of pocket.
But for the rest of us, the #101, #201, #301’s out there it doesn’t make financial sense. The speed of earning miles in the air just isn’t fast enough.
– Written by Sam Simon. All ideas are my own, but I encourage you to see my point of view and I promise I’ll try to do the same. Connect with me on Twitter @Milenomics.