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:: Articles About Randy |
Come Fly With Me
(originally published in the April 1998 edition of Conde Nast Traveller magazine)
Randy Petersen is an air-mile millionaire eight times over, says Frank Barrett. The guru of frequent-flyer programmes, he offers wisdom to the airlines and their customers. But business travellers can only dream of sitting beside him on a flight - Petersen always flies economy.
From His office in Colorado Springs, Randy Petersen's answering machine sends out this message: 'Hey, thanks for calling, I'm probably out flying around getting a few more frequent-flyer miles; or else they've got me tied up here in a meeting talking about frequent-flyer miles; or I'm on the phone answering somebody's questions about frequent-flyer miles. Anyway, I think you know how it goes.'
This is the way it goes: 42-year-old Randy Petersen produces magazines, writes books, addresses conferences and makes regular broadcasts, all about frequent-flyer miles. He eats, sleeps and drinks them too: Petersen is the world's leading expert on the subject.
It's a big subject: 75 million people worldwide are signed up with frequent-flyer programmes. More than one in six Americans is a registered collector - 57 million of them. Seven per cent of all people flying in North America are doing so with a free ticket earned from miles. Altogether, 11 million tickets were given away last year, through 90-odd different programmes. 'Every major airline in the world now has one or is about to have one,' says Petersen. 'Aeroflot is just launching its scheme.'
When frequent-flyer programmes were born in the early 1980s, Petersen was marketing manager for the retail fashion chain Chess King. The deregulation of US air travel had led to fierce competition and, inspired by the US banks' success in winning new accounts by offering free toasters, airlines set about devising customer-loyalty schemes: fly with the same airline often enough, and the reward was a free ticket.
Petersen signed up with the TWA programme. 'Their brochure said that if I did this and that, I could earn free travel. It seemed too good to be true. But I believed them. And guess what? They were telling the truth.' So he signed up for all the other airlines' programmes, too.
To maximise his perks, he avidly scanned the small print, and was astonished to discover how carelessly his fellow travellers let their entitlements go. His boss came in to see him in 1985. 'He dropped a thick stack of paper on my desk and said: "Randy, I need some help." He was a member of the Marriott Rewards scheme. He was a smart guy, but he didn't have the time or the patience to figure out the benefits.'
This was the moment of revelation. If his boss Rocky Sullivan couldn't make head or tail of the small print, Petersen figured, there were probably lots of others in a similar position who needed help - and would pay for it. He resigned from his job and devoted himself to frequent-flyer miles, initially producing a newsletter, Inside Flyer, to explain and evaluate the various programmes.
It turned into a magazine, published in US and UK editions; it was joined by The Official Frequent Flyer Guidebook, a 500-page digest of the different airline-programmes which now sells more than 100,000 copies a year; the publishing empire swelled further with The Miles Guide, a listing of 15,000 mileage-earning schemes (excluding airlines), and a website, with 750 pages of information.
And as well as advising consumers (and selling them 'frequent-traveller merchandise' - notepads, coffee mugs, T-shirts), Petersen does the same for the airlines. Executives hasten to seek his advice and run any innovations by him - because he knows more about frequent-flyer programmes than they do.
The key factor in their recent growth is non-flyer miles. Everyone is offering customers free miles, from credit-card companies to department stores. Petersen reckons that these schemes are responsible for more than half the miles collected. 'I estimate that, if you are paying attention, there are seven buying opportunities a day to collect miles with: the choice of restaurants, petrol stations and shops, the use of a credit card or telephone company, and so on.'
With so many people claiming rewards, it is inevitably becoming harder for travellers to get tickets on the routes they want at the times they want. Most frequent flyers, says Petersen, use their miles for upgrades; and the biggest source of complaints is the difficulty of making that switch to a seat in business class. His company is selling T-shirts with a slogan directed at check-in staff: 'What part of the word "upgrade" don't you understand?' it asks.
Curiously, Petersen himself never looks for an upgrade. He always pays his own way, in the process accumulating a massive eight million air miles. "It's not the most in the world,' he admits, a little regretfully. In frequent-flyer lounges the world over, people talk about the publishing executive said to charge his company's catalogue postage bill to his own credit card and to have racked up 23 million miles. Petersen knows of someone in Hawaii 'who works as a courier and commutes to London twice a week, flying first class, carrying documents for Japanese investors. He's earned 12 million miles.'
Despite his own massive earnings - his miles would take him first-class from London to Hong Kong and back 40 times - Petersen has taken a vow of self-denial, and never cashes them in. He has given some away to charity and provided some as perks to staff, but holds the rest in his 'pension fund', to be used when he retires. 'I fly like everyone else, so I can see how the system works. I haven't left my roots: I'm still the guy in seat 22F in coach [economy class] with the other "Road Warriors".'
Running his own business enables Petersen to 'dress for comfort these days'. So, sitting in his London hotel, he looks more like a former rock musician than a former fashion-store executive, with his Nike shell suit and hair that hangs over his collar.
As he prepares to go out for dinner, he explains why he is going to a particular restaurant in Chelsea. 'I use it a lot because they give me 10 miles for every dollar I spend - so for my dinner there tonight I'll earn 500 miles.' He pauses and smiles. 'They always give me a warm welcome. They think I go there for the food.'
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