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This article was published in 2019 in a series on the history of British Airways and its predecessors Imperial Airways, BOAC and BEA. You can browse all 100 stories in number order, by theme or by decade.
Many have been updated since first published.
The very first frequent flyer programme can be traced back to 40 years ago, after the deregulation of the US aviation market in 1978.
Deregulation allowed US airlines to choose their own routes and set their own fares without Government approval. Established airlines facing newer upstarts turned to incentive programmes to revive falling revenues and profits.
The very first frequent flyer programme is credited to a small regional US airline called Texas International Airlines. By today’s standards, it was relatively unsophisticated. Passengers earned paper coupons which could be pooled to earn free flights.
American Airlines launched its “AAdvantage” programme on 1 May 1981, which American widely credits as the first true frequent flyer programme. At the time of launch, it wasn’t certain it would last. However, all major US airlines quickly followed suit. And they were an instant success.
By 1984, an estimated 75% of US business travellers were members of a frequent flyer programme. The programmes soon expanded their reach with the ability to earn miles from car hire and hotels, and redeem miles on international partner airlines.
Even without the aid of internet blogs and forums passengers quickly learned how to exploit the programmes to maximum advantage.
The Launch Of The Executive Club
BA launched the Executive Club in 1982.
Relatively little is known about its early years – though its name clearly indicates it was targeted at what were then predominantly business travellers. Some of the earliest BA lounges at Heathrow were known as Executive Club lounges.
The Air Miles Currency
The Executive Club was not at first traditional mileage accrual programme. The first miles based loyalty programme in the UK was in fact Air Miles which launched in 1988.
This was acquired by BA in 1994. For many years, the only way to earn miles flying on BA was to credit your flight to another airline programme.
In the 1990s, in response to American Airlines, United, Virgin Atlantic and others gaining access to Heathrow, BA introduced Air Miles as the currency for its frequent flyer programme.
This became BA Miles in 2000 with Air Miles, later to become Avios, continuing as an independent programme.
The programme has been through periodic changes over time. In its early years the emphasis was very much on exclusivity. Additional tiers have also been added such as Bronze, and Gold Guest List – no matter how high you reach in the hierarchy, there is always something you don’t have access to. There is of course the elusive invitation only Premier status, which is a case of if you have to ask…
Whilst the Executive Club remains geared towards rewarding most those who are seated closest to the nose of the aircraft, there has been emphasis on becoming more inclusive. The programme is aimed at leisure travellers, just as much as business passengers. BA has tried to move away from the perception of a hierarchical club to one where each membership tier carries its own identity and benefits:
Of course today, miles can be earned through many more means than flying. Spend any time in Central London and you’ll regularly see BA branded American Express cards tapped on to Tube gates and contactless payment readers.
The formation of International Airlines Group in 2011 saw Avios become the currency of the Executive Club with sister airlines Iberia, Vueling and Aer Lingus also later adopting the currency. As Avios balances can be moved between programmes, this increased opportunities for earning & redeeming Avios, and the scope for arbitrage. Avios issuing activity also become consolidated under a separate division of IAG, known as IAG Loyalty.
In total, over 100 billion Avios are issued across all participating programmes a year to more than 8 million active members. Around half are issued through means other than flying. The sheer scale of the programme does make it an extremely powerful, and some would say a distortive influence which smaller rivals such as Virgin Atlantic struggle to compete against.
For BA, it is also a customer service recovery device. Whether it’s a faulty in-flight entertainment system or a complete operational meltdown at Heathrow, a dolloping of Avios can help smooth everything over. Some frequent flyers would say that, in truth, their loyalty is to the Executive Club, not the airline itself.
At some point BA is expected to follow US airlines and start issuing miles by reference to the price paid for the ticket rather than distance flown. Reward flights will also be subject to “dynamic pricing” rather than a set tariff. Subject also to IT upgrades, members of different frequent flyer programmes that use Avios will also have access to a single “Avios Bank” across all programmes.
You can continue reading our 100 part series on the history of British Airways and its predecessor airlines Imperial Airways, BOAC and BEA in numerical order, by theme or by decade.
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“BA launched the Executive Club in 1982. Little is known about its early years. However, it was not a traditional mileage accrual programme. (For many years, the only way to earn miles flying on BA was to credit your flight to another airline programme.)”??
As a very early member of the Ba Executive Club having been a frequent transatlantic flyer in the 60 & 70’s I can tell you membership was by invitation only not subscription and based on the frequency of use. My original WHITE Executive Club card is number 20449. Ba respected its early members and there were often small gifts that arrived unannounced in the post. I still have in daily use a Concorde letter opener sent prior to the aircraft’s inauguration flight. Upon my retirement and less usage of the airline my Executive Club membership was summarily terminated by Ba around 1994 and a Blue Card sent in its place.