by Josh Lew
Last updated: 1:30 PM ET, Wed December 16, 2015
Photo courtesy of The Miles Store
Newark has just received a new place to shop. The Miles Shop, in the New York area airport's Terminal C, appears like a normal airport storefront, stocking travel supplies and other miscellaneous items. The unique thing about this shop, which is operated by airport restaurant and retail management company OTG, is that shoppers can make purchases with airline miles instead of cash.
A store that accepts frequent flier miles
United MileagePlus members are able to pay for their purchases with their frequent flier miles, or they can pay with cash or credit and earn five miles for each dollar spent. Prices range from 600 miles to 50,000 miles. United executive Praveen Sharma hyped this new concept: "The Miles Shop at Newark Terminal C is a terrific extension of [our] mission, as it offers United customers expanded opportunities to earn and use their miles [in ways that are] as diverse as our customers are themselves."
Actually, Newark has been the site of tests for the idea of allowing fliers to use points to pay for face-to-face transactions inside airports. For the past year, United and OTG have been allowing people to pay with their MileagePlus miles at select restaurants in Terminal C. OTG CEO Rick Blatstein explains the process: "We've received tremendous positive feedback since last November when we introduced the ability for customers to use their MileagePlus miles for meals, and the development of the Miles Shop is a direct result of that unique experience."
A new concept. Is it ready to take off?
The shop will be open during the holiday travel season, so OTG will get a good feel for how it performs during a highest traffic time of year in Terminal C. Using miles for non-airline purchases is not a new concept for online shopping, but using them for face-to-face purchases in shops and restaurants is. The question is whether or not this idea will ever move beyond Terminal C.
A win for fliers?
Obviously, for frequent fliers, having one more option for spending miles is a good thing. If they don't want to use their earnings for flights, for whatever reason, a stop by the Miles Shop can provide an alternative. The concept will probably be more useful for people who have leftover points after they have bought an upgrade or earned a free flight. It could become a place to spend those extra miles that would otherwise just lay around.
But what about airlines? They benefit when people don't use their extra miles, right? On one hand, this might be true, but on the other, the Miles Shop could be a way for United to differentiate its loyalty program from the competition. Obviously, they would need more partners who were willing to accept MileagePlus points if they wanted to expand the face-to-face miles spending idea to their other hubs and focus cities.
A perk or a new currency for travelers?
If the Miles Shop idea is accepted well over the holidays in Terminal C, it could very well expand to other airports where United has a large presence. The idea could become a trend if other airlines start adopting the same strategy, either because they feel a need to compete with United or because they want to expand on the initial idea.
If the trend really takes off, we may see frequent flier miles become more like a currency for travelers rather than a perk for loyal customers.
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