MaxMiles Pioneers Statement Consolidation

www.maxmiles.com

Not only do travelers get a consolidated view of their miles and points across a number of programs, they also receive an analysis of expiring miles and hints on how to get more miles from the various programs.

The frightening aspect of this program, from the perspective of the airlines, is that the program runs WITHOUT their involvement. So they lose primary Web contact with the customer.

MaxMiles at a Glance

Launched: 1996 using shrink-wrapped software, 1997 on the Web.

Retail User Cost: $2.95 per month after the first three free months.

How it Works:

1. New users register with MaxMiles and input their frequent flyer/hotel account numbers and Web passwords for each program (if needed, some programs such as Northwest do not require a password).

2. Users turn over a limited power of attorney to MaxMiles, which gives the company the right to retrieve statement data on your behalf. In essence they are you when dialing into the databases of your travel providers.

3. Users enter the password-protected MaxMiles database to view summaries and analyses of their points totals across all their Web-enabled travel accounts.

MaxMiles has tentacles all across the Web. Here is its co-branded version with Excite.

Is this the future of banking? Most analysts, ourselves included, didn’t expect statement consolidators to appear in financial services until the widespread adoption of OFX-formatted data feeds. MaxMiles and bizMiles prove that you don’t need standardized data to launch a consolidation business. It just takes creativity. Gaining power of attorny over the users frequent flyer accounts was the key to making it work.

Handing over a power of attorny for a bank account, no matter how it’s worded, is a much different matter. A prospective banking statement conslidator will need to build a high level of trust backed by iron-clad privacy and security guarantees. This may prove a challenge for start-ups such as MaxMiles. But could Charles Schwab convince its loyal users to hand over permission to access their bank account data? We think yes. We won’t even speculate on the regulatory issues of such a service, other than to say it’s a very gray area.

Statement consolidation, whether it’s bills, frequent flyer miles, or bank accounts, is an excellent application for the Web. MaxMiles provides numerous services you don’t get from an airline, such as the top 25 ways to bag more miles across all your airline programs; an analysis of your expiring miles so you are less likely to let them go to waste; and an alert if it appears you’ve not been properly credited for miles (e.g., only receiving mileage credit for one leg of a round trip).

Think of the value-added services you could layer on top of a consolidated view of the user’s financial accounts. For example, a credit card statement consolidator could do a rate analysis suggesting ways to move balances around to get the overall best rate (see OBR 7/98 for more ideas). 8

A Slightly Different Model at BizTravel

BizTravel.com offers users a convenient jumping off point to access their frequent flyer accounts, but they don’t consolidate the statements.

Online travel agent BizTravel.com competes with MaxMiles with a similar sounding service, bizMiles <bizmiles.biztravel.com> that’s free, but less helpful. Clicking on the View Statement button activates a cgi script logging you into the airline and showing whatever the airline wants to show. It’s a convenient way to quickly look at your frequent flyer accounts, but it doesn’t provide any of the useful analysis, such as expiring miles, delivered by MaxMiles.

bizMiles works as a free service because it’s a value-add that keeps users coming back to the travel agent’s Web where links and offers pull users into
the ticketing area to buy airline tickets and book
hotel rooms. A bank could offer an identical service to build Web traffic.

BizTravel’s refer-a-friend pays a $25 Amex GiftCheck for each referral that actually books a flight. The friend gets $25 for the first flight, you get $25 for the second.