Last week, I wrote about retailer’s operations in both coupons and how their point of sales operate.
Today, I wanted to quickly discuss point transfers. There’s many programs that interface with each other. I’ll quickly discuss the “big 3” as they are all very similar in processing. When I say “they are all,” I mean hotels to airlines, credit cards to airlines or hotels, and other kinds of point transfers.
Chase Ultimate Rewards, American Express Membership Rewards, And Starwood Preferred Guest
Before the Ultimate Rewards redesign, Chase told you that your Ultimate Rewards transfer would be done within 2 business days to Singapore Airlines KrisFlyer. Meanwhile, all the others are “instantaneous.”
All of the processing are obviously done in a batch process. Meaning at a certain interval a program will run and send whatever data is available to be sent to the respective consuming system. In addition, the consuming system needs to be willing and able to accept the incoming data for processing.
That being said, we’ll start with the “instant” transfers. They’re not quite as instant as you think. The intervals in which the processing, as an example, on the Chase side just means it is very frequent. We don’t know the timing, just that it is quick. Every 5 minutes? Every 15?
After Chase runs the process to ready sending the Ultimate Rewards, the other side needs to be ready to accept the file. How quickly do they process the incoming file? Is it based on receiving a file and instant processing? We’re not sure on that as well, however, we do know that they’re reasonably quick end to end, thus we call them instant.
From a processing stand point, it makes sense for the consuming file side to process immediately upon receiving the file.
Transfers That Take Longer
There have been recorded instances where someone transferring Starwood Preferred Guest points take a day and others take days. It is that reason why Chase used to say “up to 2 business days” for KrisFlyer and some will see the transfer happen on day 1 instead of day 2. Again, this is because of the batch processing. Instead of a more frequent interval, this is because there is a set day for the processing on the originating system.
Why is that? There are many reasons for having longer intervals before processing, but none that I am privy of. Therefore, I will postulate and explain my thinking. My top reason for an infrequent interval is information security. We have discrete systems and sending files over the Internet. Absolutely, this will be a secured connection transferring files. However, one side, likely the consuming, refuses to have the “door” opened 24/7/365 as that allows an entry point into their systems. If you can control when the “door” is opened for certain times, you will know what comes in or goes out.
I believe it is this reason for the technical difficulty between Korean Air and Chase on the point transfers and thus the removal. Korean Air may want a less frequent transfer, while Chase is imploring an instant transfer and they are negotiating the best terms for each other.