One of the little known ways to attain elite status is through a concept called “Status Challenges.” American Airlines has one of the best and if planned out well, easiest status challenges around. Personally I think it is a great way to capture high value customers who are either just starting out in a job like consulting that requires frequent travel, or people who don’t fly as frequently, but tend to purchase more expensive tickets and want the benefits and recognition of elite status when they do travel.
AA’s status challenge program is fairly well known in the frequent flyer community. Basically you can only sign up for either a Gold or Platinum challenge (on rare occasion they will offer a Executive Platinum challenge), but the program is structured around the lowest two tiers. You must sign up starting either on the 1st or 16th of the month. The Gold challenge costs $120 and the Platinum costs $240. You must fly 5,000 Elite Qualifying Points (not miles) to complete the gold challenge and 10,000 EQPs for Platinum. You will then earn status through Feb of the next year if you start the challenge before June 14th of that year, or through Feb of the year after if you start after June 14th. Keep in mind AA realizes this discrepancy and I believe that they reduce the cost of the challenges if you start before June 14th. I called prior to June 14th this year and they offered the Gold for $90 and the Platinum for $150. Finally, the challenge must be completed within 90 days. This Wiki has some great information about the challenge requirements.
http://www.flyerguide.com/wiki/index.php/Challenge_(AA)
My approach.
First, who would want to pay $240 for the option of getting status? So I selected AA as my airline for my up to $200 per year in fee credits on my Amex Platinum Business card. I then called AA and paid for my challenge using my Amex. Unfortunately I haven’t yet been reimbursed for this and I’m not 100% sure I will be, but from the blogs I’ve read Amex is pretty liberal with their interpretation of fees and people have been able to get credits for gift card purchases, so I’m confident I’ll be able to get credit for this purchase. Also, since I was staring the Platinum challenge I told the agent that I had Premier status with United and asked if I could have Gold status immediately. She said “sure” and never even asked for verification (just FYI I do have MileagePlus silver status).
Second, I waited until June 14th to start my challenge. Why? Most people would try and save money and just go for Gold status since Platinum doesn’t buy you that much more over Gold, but there are two reasons why Platinum appeals to me. First, I like the fact that you earn a 100% mileage bonus on all flights. Gold only earns a 25% bonus. If you fly a lot the 75% extra earns you a ton more miles. Second, and this is a little less apparent. By earning Platinum status…let’s say you don’t requalify for Platinum in the year after you earn the status. AA will likely “soft land” you to Gold, which means you won’t have to do another Gold challenge to earn status the next year. That alone would be worth $90-120, so it’s an excellent hedge to keep elite status for at least 2+ years!
Third, plan out my travel. This is the hard part. First, familiarize yourself with the EQP earning chart, since the challenge only deals in the world of EQPs not EQMs.
http://www.aa.com/i18n/AAdvantage/eliteStatus/qualification-requirements.jsp
As you can see, EQPs are solely dependent on the fare class you purchase.
A,F,P = 1.5 x mileage
D,I,J,R = 1.5 x mileage
B,Y,W (W in premium economy on codeshare partners) = 1.5 x mileage H,K,M,L,W (W on AA metal),V = 1.0 x mileage
G,Q,N,O (O not between North America and Latin America), S = 0.5 x mileage
This last rule really bites the big one. Almost all of my travel is usually in the lowest fare classes and it seems AA almost always has Q open even a few days to departure, so it’s difficult for me to get 100% EQPs even on my business travel. I planned to do a lot of trips between San Francisco and Chicago, which round trip costs about $350 (if you plan it right) in economy. Assuming the mileage you FLY is about 3,700 miles round trip, that would mean that a discount economy fare (G,Q,N,O class) would only earn you half of that, or 1,850 EQPs. You would have to fly about 5.5 round trips or 11 one-ways just to complete the challenge! And this must be done in 90 days? On top of that at $350/round trip you would be paying $1,925. Even at a mileage run rate of $200/RT you would still be out over $1,000 and have to fly almost every other weekend to finish this challenge. The typical leisure traveler would never be able to do this.
Fourth, I planned my trips. It’s always good to take trips to places where the low cost carriers compete aggressively. Places like Los Angeles, Florida, Las Vegas are great places to find cheap fares and also to visit for the weekend. I planned out the following trips.
Round Trip Miles Fare Class EQP Rate Total EQP Cost Cost/EQP LAX-ORD 3,500 P 1.5 5,250 $700 0.13 MIA-ORD 2,400 Q 0.5 1,200 $200 0.17 LAS-ORD 3,100 Q 0.5 1,550 $300 0.19 ORD-SFO 3,700 Q 0.5 1,850 $450 0.24 ORD-STL 500 Q 0.5 250 $150 0.60 Total 13,200 1,100 $1,800 0.18
Obviously, the key to my completing this challenge was the trip done in P class to LA which ended up netting me over half the EQPs needed to complete my challenge! I booked the trip using my Citi Premier card which offers a 15% discount on all trips booked through their partner Spirit Incentives. The discounted first class fare was only $200 more than the economy fare and earned me 3x the amount of points I would have earned by purchasing the economy fare!
My total out of pocket expense was $1,800, but if you net out the 13,200 redeemable miles that I earned for redemption and add my 25% Gold bonus and 50% bonus for purchasing P class on my LAX trip, I ended up with 18,250 redeemable miles, which at my 1.9 cents/mile valuation is worth about $350. I must also If you subtract that from the $1,800 I spent to get Platinum status, my net cost was $1,450. Also, since I was Gold when I started I earned 4 500-mile upgrades, which would otherwise cost me $30 each if purchased from AA, so that is worth another $120, bringing my cost down to $1,330 Add in the $40 unreimbursed portion of my Platinum challenge fee, I spent $1,370 to get elite status for 2+ years.
While this wasn’t a cheap endeavor. It was great meeting friends and family on my trips and having elite status for over 2 years will be not only save me money in bag fees and preferred seating, but also earn me mileage bonuses, and maybe even a few free upgrades.
It’s worth noting that had I only done the Gold challenge and bought the P class fare, I would have completed the challenge with only one round trip.
Bottom Line:
If you are going to attempt the AA elite status challenge make sure you start it after June 14th to get it for an additional year. I would also recommend attempting the Platinum challenge for the additional year (hopefully) and ask for free Gold status upfront if you do select the Platinum challenge. Finally, consider buying a discount first class trip if it’s cheap enough. Sometimes a P class fare could be cheaper than economy on a per EQP basis. In my case the P class fare was my cheapest fare on a cost/EQP bases at only 13 cents per EQP. This would be very counterintuitive for many people.
Point Rich, Cash Poor 