1,000 Bonus Points and a Free Flight: Deal or No Deal?

It’s been a busy week for [[Virgin America]], delivering on old promises, and making new ones.

First, as [% 2749856 | | discussed yesterday %], Virgin America finally began allowing members of its Elevate program to redeem their points for free flights. And then they rolled out a new credit card that awards Elevate points for charges. Well, they didn’t actually roll it out … they announced that the card is “coming soon.” And they’re offering an extra incentive to register for the card by November 30.

The card basics are pretty standard for airline rewards cards. Cardholders earn one point for every $1 charged to the Virgin America Visa card, and three points per $1 spent on Virgin America tickets or in-flight purchases. There’s no annual fee. And there’s a bonus for using the card the first time, a rather paltry 2,500 points.

Presumably to generate some initial interest and excitement, those who apply for the card by November 30 will be rewarded with extra bonuses. The subject line of the email solicitation was certainly an attention-getter: “Get 1,000 bonus points and a free flight.”

When someone offers me a free flight, I assume that I’ll be returned to my point of origin—i.e. that it’s round-trip. The “free flight” used as a sales incentive by Virgin America, it turns out, is one-way. So you’ll have to pay for the other leg of the trip if you choose to return home.

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More substantively, in today’s highly competitive market for new credit card customers, a one-way ticket on a limited route network is an average bonus at best.

The current sign-up bonus for a United Mileage Plus Visa card is 30,000 miles, more than enough for a round-trip award ticket, or two one-way upgrades. Sign up for the American AAdvantage MasterCard and you’ll earn 25,000 miles for charging $750 within four months.

And those additional 1,000 points for early adopters? Even combined with the 2,500 points normally awarded after the first charge, you’re a long way from earning the 13,860 points required for a round-trip award flight that would cost a mere $298 if purchased. More expensive flights would be even further out of reach.

If you’re planning to participate in the Elevate program, it might make sense to sign up for the card, if only for the sign-up bonus and one-way ticket. The real question concerns the value of Elevate itself: Consumers should ask themselves whether they are likely to reach an award threshold before their points expire in just 18 months. If not, the Elevate program is an empty promise, as is the affiliated Visa card.