Archive for January, 2010

My travel tips for those that are new to business travel

This is not exactly my typical type of post for this blog, but there is a lot of really good stuff in here (if I do say so myself).  Enjoy:

Tip #1 – Loyalty Matters

Believe it or not, loyalty counts and can be “rewarding”. While the points, miles and status you earn are really a “consolation prize”, they do make traveling for business a little nicer and can actually come in handy when it is time to travel for personal reasons. All reward programs basically work the same way. Each program has some form of “currency”, be it points, miles, gold stars, whatever. You accumulate these points over time and as you hit particular thresholds throughout the year, you are given “status”. Status, then brings with it some kind of bonus such as “a free bottle of water in your hotel room”, or 25% bonus points, etc. The more you earn, the higher the level of status, the more points, the more perks. Once you get these points, you can then spend them on all kinds of things; from free airfare, hotel rooms and car rentals to Amazon.com or William Sonoma gift cards. Each program’s status levels are different and each program’s point value (in dollars) is different. The important thing to remember is, when possible… pick one program for each aspect of travel (Air, Hotel, Car) and stick with it as best you can.

Tip #2 – Miles Matter – Join a FF program and stick with it or one of its partners

The most important program to join for the business traveler is an airline Frequent Flyer plan. Each airline is different and values its status differently. But none of that matters if the airline is not convenient for you. For this reason, most people pick the airline that provides the most “direct” (aka non-stop) flights from their primary home location. This means that if you live in Seattle it is probably best going with Alaska Airlines, if you live in New York, it will probably be American Airlines, Atlanta would be Delta and DC would be United. Whatever your carrier, be sure to get in the program.

Now, “miles” are a funny thing and their value is mutable. The first thing to know is that there are two types of miles. There are plain old “miles” and “elite qualifying miles” (EQM). EQMs are the miles you earn for actual flight and they count towards your status… other miles, such as the miles you get for using 1-800-Flowers, etc are just standard miles. Most programs require that you earn between 20k and 25k miles in a calendar year to hit the first “tier” of status. After that it is typically 50k or 60k for the second, and so on. Status perks usually include:

  • Free upgrades to First class 
  • Preferred seating (Exit rows, bulk heads, economy plus, etc) 
  • Bonus miles (25%, 50%, 100% depending) 
  • Priority Standby, Boarding, Baggage handling 
  • Waived fees (like change fees, baggage fees, etc) 
  • Discounts of club memberships 
  • Priority access through security lines (This can save you hours on holidays and other busy times) 

If you travel a lot, it’s all about getting status and earning “EQMs”. When you join your frequent flyer program, be sure to read up on the partners that your program supports. This is very important. There are three types of partners:

  • Those that let you earn EQM 
  • Those that only let you earn standard miles 
  • Those that let you earn / spend miles for non-air travel 

Obviously, EQM miles are worth a lot more to the traveler. I use Alaska Airlines and as such, I can earn EQM whenever I fly on Alaska, Air France, Delta, Horizon, KLM, LAN, Northwest or American Airlines. As you can imagine, I will go out of my way to only fly on one of those 8 airlines.

Tip #3 – Join a hotel reward program

Just like airlines, hotel programs let you earn points and climb the ladder of perks. There are many programs out there, but if you travel a lot… it is recommended that you pick one of the big guys, otherwise you will be unlikely to find a partner hotel near that random Air Force base in the middle of nowhere. The big four are Hilton, Priority, Starwood and Marriott. I have stayed in them all and I don’t think there is much of a difference any more. I currently am Gold on Starwood (through my credit card) and Silver on Hilton (through stays). They all work the same way and they all value their “currency” differently. Hilton points are worth about $0.005 each, but let you earn miles at the same time; while SPG points are worth about $0.015, but don’t let you earn miles at the same time (however you can often transfer them to miles and get bonus value when you do so). I picked Hilton because it has over 3,000 partnering hotels, which is 3X as many as SPG. Just like airlines, with each program there are a variety of partner hotels you can stay at. What is important is that you try to stay within the family and earn points towards your status. The following table is useful:

http://www.starwoodhotels.com/preferredguest/account/member_benefits/program_comparison.html

Tip #4 – Rental Cars Programs

Personally, I find rental car programs the least rewarding in terms of status. I am “First” on Avis and frankly don’t notice. The big advantage with this programs though is saving time; faster reservations, faster pickup and faster drop off. Whether you join Hertz Gold or Avis Preferred, your car should be waiting for you when you get there, with your name of a board, the keys in the car and you just get in and drive off. The extra hour you save is definitely worth it. Just like airlines, the more you rent the more you get… I think I get a free weekend rental every now and then and occasional free upgrades as well. Avis’s program is free (so there is no excuse not to join), Hertz charges $60 a year… $30 a year for AAA and its free for USAA and others. Again, I recommend the big guys as you are more likely to be able to rent from them where you are going.

One other tip with rental cars is to avoid the stupid “up charges”. With car rentals, be sure to check with your credit card or insurance carrier… typically they cover you for the rental, so there is no need to spend the extra $15 to $40 a day to buy the rental company’s garbage insurance.

Tip #5 – Take advantage of discounts

Whether it’s a hotel stay or a car rental. Consider taking advantage of discounts. While you could have the “spend as much of the customers money as I can, so you can earn 1% on your credit card point program” attitude, it’s pretty lame and a little big slimy (See Tip #11).  Why not save the customer or the company some money and actually get a better reward at the same time. This saved money will general find its way into more hours for the project, more money for the bonus pool or an upgrade for yourself. Consider the following – Most hotel chains provide a “AAA” discount. On a recent trip, I was able to get an “Executive Floor Suite” with free WiFi and free breakfast for $114 a night… vs. the $120 + $10 + $10 other traveling with me spent. So by using the AAA discount, I saved the government money, I saved the company money on WiFi and I saved myself money on my Per Diem. The same is true for rental cars. If you rent a car and pay full price you are doing it wrong. Between your insurance provider or your credit card provider, you are more than likely eligible for a 5 to 30% discount. USAA for example offers 25% off Avis and Hertz… that is money that can be better spent on an upgraded car or back in the customers pocket.

Also, keep an eye out for promotions. Visa Signature ran a Hilton special last year that gave you 25% off their “Best Rate” and bonus points for your stay. This means that I was able to get nicer rooms and more points for less money.

Tip #6 – Be aware of hotel value

See this post: http://www.belowyourmeansblog.com/2009/08/hotel-value.html

Tip #7 – Take advantage of credit cards

First off, if you can and don’t carry a balance… use a credit card for everything! It’s easier to track and you earn points, miles or whatever. Second, make sure you pick a credit card that doesn’t suck. As of now, I recommend two cards:

  • The American Express Starwood Preferred Guests Card – You earn Starwood points (worth $0.015 instead of the typical “credit card point” of $0.01) and you can earn SPG status. In addition, you get a 50% off coupon each year… which if used wisely can save you several hundred dollars on a vacation hotel stay.

  • Some form of airline card – Generally speaking, whatever FF program you joined, you should strongly consider the corresponding credit card. They usually let you earn miles, have things like “discounted companion tickets” (Which saves me easily save $800 a year) and some even let you earn EQM (which is nice if you don’t travel enough to get to that next tier)  

The key here is to not carry a balance. If you pay late fees or pay interest (even once), it typically negates an entire year of perks.

Tip #8 – Spend your points wisely

Once you earn all these miles, points or what have you… be sure to spend them wisely. Points and the like can be spent on all kinds of things, but before you do… it is a good idea to figure out the value / conversion rate you are getting. For example, if you use airline miles for domestic coach flights you are typically getting about $0.018 to $0.02 per mile… if you use it on domestic First Class you get between $0.02 and $0.025 and if you can save them up and use them on International First Class or Business Class you get approximately $0.04 to $0.15 a mile!!! That is a big difference. To figure out the value you are getting, just find out how much the thing you are about to spend your points/miles on costs in dollars, then divide that amount by the number of miles.

Example:

  • First Class for two from Seattle to Miami on American Airlines… costs approximately $3200 or 125k Alaska Airline Miles
  • For this trip my miles are worth approximately $0.026 a mile
  • First Class for two from Seattle on Sydney… costs approximately $24k depending on carrier or 260k Alaska Airline Miles
  • For this trip my miles are worth approximately $0.092 a mile
  • One extreme example was a few years ago, I took a $19,000k trip on British Airways for 140k miles… almost $0.14 a mile. 

Points for hotels, credit cards, etc work the same way. Make sure you get the most bang for the buck. If you have miles, points, etc in a dead end program… consider using a tool like Points.com to transfer them between programs.

As a general rule, never use miles or points to buy “stuff” and only use them for gift cards or the services on which you earned them (Miles for flights, hotel points for stays, etc). 90% of the time, that thing you want to buy is a total rip off. It is not on common to see things like; Apple iPod for 200,000 points. If that iPod only costs you $89 at Best Buy and you could convert 200,000 points into a $200 Best Buy gift card… why on earth would you “throw away” $111?

Tip #9 – Fly wisely

When flying, consider what city your flight connects through. Chicago is a mess during the winter and southern states have really bad thunderstorms during the summer. Cities in hot valleys like Las Vegas and Denver tend to have bumpy take offs and landings. Keep this in mind when booking trips. It can mean the difference between getting stuck and making it home on time.

Tip #10 – When you do travel, make the most of it…

Take in the sites, see the city, sample the local foods, relax, swim in the pool, whatever. Business travel gets old, but can be mildly enjoyable if you take advantage of the places you go. Also, consider bring your significant other with you. If they share the hotel room with you, it can be a like a free vacation. Two years ago, my wife was able to join me in Germany for next to nothing. Work paid for my flight, car, meals and hotel and for her, we found an ultra cheap Seattle to Munich flight for $299! It was definitely worth it.

Tip #11 – Don’t be an ass

When it comes to frequent travelers, jerks and the like are a dime a dozen. It has been my experience that if you are nice to the person behind the counter or on the phone you will get a lot further a lot faster. A kind word and an extra please can mean the difference between a corner room and one next to the train tracks or between an Exit Row seat and a middle seat next to the bathroom. On my most recent trip, I had flown in on a redeye and arrived at my hotel 6 hours before check-in. On the phone, I kindly asked for a “courtesy suite” so I could get cleaned up… the lady said they didn’t offer these and that I would have to wait until 1PM to check-in, I thanked her and told her I would very much appreciate anything she could do. When I got to the hotel, she had actually arranged to check me in to a room temporarily and then move me to my room later on. Definitely a bonus, I got 45 minutes of sleep and a much needed shower.

Tip #12 – Pack and travel light

This may sound obvious, but it is often overlooked. For starters, if you are traveling for business and checking luggage… you are doing it wrong. Simply bring less stuff with you. Consider buying things you need when you get there. Know that most hotels have free soap, shampoo, tooth paste, shaving kits, sewing kits, etc… you just have to ask. Also, do you really need to bring 3 different chargers with you? Your PSP, iPod and cell phone can all probably be charged by a single universal USB charger… or if you are even more hard core; you can charge them off your laptop. And who needs a music player and a cell phone… get a phone that does both.

Tip #13 – Stay Healthy

When you travel you tend to get less sleep than normal and you may have elevated levels of stress. Both of these things can weaken your immune system. Add to it the coughing and wheezing stranger from Imsickistan next to you in 6D and you have a good mix to get you sick. Wash your hands often, bring a travel size bottle of hand sanitizer with you and gets lots of vitamin C, E and D. Other things to know – don’t drink the water from airplane faucets (nasty) and don’t use the glasses that they give you in hotel rooms (I have seen one too many news specials that show how the cleaning crew just use Windex to clean them). If you take your shoes off when you fly, put them back on when you go to the bathroom… airplane bathroom floors are freaking nasty.

Enjoy…
This posting is provided “AS IS” with no warranties, and confers no rights.

US Pledges to donate $100M to Haiti – China pledges “only” $4.4M

I found this too ridiculous to not comment on:

Article number one:
US Pledges $100M in support for Haiti
http://www.guardian.co.uk/world/2010/jan/14/haiti-barack-obama-aid-china

Article number two:
China to positively respond to UN flash appeal for quake-hit Haiti (Donate $4.4M)
http://news.xinhuanet.com/english/2010-01/16/content_12818703.htm

Of course, everyone knows that the US doesn’t have any money to pledge, but that doesn’t matter.  We are after all running an annual budget deficient of over $1T on top of our $12T+ in outstanding debt; so what’s another $100M.  It is in fact, nothing new for the US to live far, far above its means.  What is interesting however is that China is living perfectly well within its’ means.  Here’s the breakdown:

This is of course all funny money but look at this it this way:

  1. US borrows $100M from “somewhere” (Fed printing arguments aside, it was probably China)
  2. The current 30-Year US Bond is paying 4.375%
  3. China basically pledges the first year’s interest
  4. Hilarity Ensues

Cheers,