Southwest Business Select tickets are a huge ripoff.
Usually.
Don’t buy them without reading this first.
Under the new Rapid Rewards program, you will earn free flights much faster by buying Business Select tickets. However, it was a mistake to stop there and assume it was a better deal.
I also want to note that over the past few years, I’ve actually become a fan and advocate of Southwest, primarily for their credit card rewards program and the ability to change flights without any exorbitant fees.
(Cough, United, cough!)
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Calculating the Net Benefit of Southwest Business Select
For my analysis I chose a flight from Oakland to Seattle. The Wanna Get Away fare was $110, and the Business Select fare was $291.
The Wanna Get Away ticket earned 594 Rapid Rewards Points, and the Business Select ticket earned 3360 Rapid Rewards points.
The cost of a free ticket was 5940 points — so it would take 10 Wanna Get Away flights, but only 2 Business Select flights, to earn that free ticket.
Side note: the cost of a Business Select free ticket was 33,600 points — a 500% premium — which would be the biggest waste of points in the history of loyalty programs.
Side note: I measure Net Benefit in terms of dollars spent on flying, because transportation is the core product being sold. To be fair, Business Select customers also get priority boarding and a free cocktail, and the warm fuzzy feeling of being special on a plane with no First Class cabin.
Over time, the Net Benefit of Business Select over Wanna Get Away is always negative. That means if you value dollars, you’ll always be better off buying the cheaper Wanna Get Away tickets.
The little upticks on the graph are when you get to cash in your Rapid Rewards points, but those gains are never enough to outweigh the extra cost of the Business Select tickets.
In my model, Business Select ends up being around 1.85x more costly than Wanna Get Away over the long run. This shows there is some tangible benefit to earning the extra points though, as it beats the straight nominal price-comparison ratio of 2.65.
Although this is only one example, I believe it holds true for nearly every case. Southwest generally prices the Business Select fares at 1.5 – 3x as much as the Wanna Get Away tickets.
When to Buy Business Select
I would steer clear of Business Select unless the price is relatively close to the Wanna Get Away fare. Obviously if the premium being charged is very small, it would conceivably be worth it to pay the extra amount.
In fact, the “magic markup” — or marginal value — of Business Select is only 12%. (Not including drinks and priority boarding).
That means if the price of Business Select is more than 1.12x higher, you’re better off going with the cheaper fare.
To see if Business Select is worth it for your flight, try the calculator out for yourself here. Input the price of the both ticket options and the number of stops. It should calculate the value ratio — any number returned greater than 1 means the Wanna Get Away fare is the better deal.
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ORIGINAL ANALYSIS under the “old” Rapid Rewards Program
On this sample flight from Oakland to Seattle, Business Select tickets are $242, compared with $72 for the “Wanna Get Away” tickets. That’s 236% more, or $340 more than the cheap ‘web-only” roundtrip fare.
And let’s keep in mind that there is no such thing as First Class on Southwest.
Here are the supposed Business Select benefits Southwest gives in return for their price gouging (and what they’re really worth):
1. Fully Refundable
True, the “Wanna Get Away” fare is not refundable, but if your plans change you can apply the cost of the ticket to a future Southwest flight within 12 months, with zero change fee.
This is only an issue if you will only fly somewhere Southwest flies one time within 12 months.
2. Priority Boarding
There is no First Class, but Southwest will let Business Select customers board first.
Typically the first 15 boarding positions are reserved for Business Select. If you’re OK with row 5 instead of row 1, I might suggest Southwest’s EarlyBird seating service, where for just $10 each way you can get priority seating. It won’t move you into the top 15 but it should be a safeguard against the dreaded C-Pass.
3. Fly By Priority Security Lane
I don’t think I’ve waited longer than 15 minutes for security… ever. Or just invest the $100 for 5 years of Global Entry / TSA Pre-check.
4. An Extra .5 Rapid Rewards Credit (per roundtrip)
It takes 16 credits (in theory) to earn a free flight. On Craigslist, the roundtrip vouchers go for about $300. If 16 credits is worth $300, it reasons that half a credit would be worth approximately $9.38.
5. Free Premium Drink
What does an airplane cocktail cost, $7? Alternatively, if you’re a really thirsty yet frugal traveler you can buy books of Southwest drink coupons on eBay for $2-3 per drink.
In total, Business Select costs a premium of $340 (in this example), yet only provides about $45 in tangible benefits. I think Business Select is an attempt to generate extra cash flow from un-savvy travelers who otherwise might not fly Southwest often or who might be fooled into thinking they’ve added Business Class service.
Don’t be one of them.
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Nick,
Consider yourself un-savvy and not so economically inclined. What you completely fail to mention in your blast of this rewards structure, is the fact that when you buy Business Select, you earn 12 points per dollar spent, rather than just 6 points per dollar spent on your Wanna Get Away ticket. I’ll assume you are not a rewards member.
Thus, economically, it becomes a question of cash flow and return on investment. If you do the math, the NPV (net present value) of the Business Select option is actually greater than that of the Wanna Get Away ticket.
In more consumer laymen’s terms: When you spend 299$ on a Business Select ticket, you earn 3456 points, versus ONLY 642 points gained from your 118$ purchase of a Wanna Get Away ticket. Effectively, purchasing a 299$ ticket is the equivalent of spending $3,456 on your Premier Rewards card. In contrasting the two options, you spend roughly $180 more, and receive a $2,814 in what would have been purchases to match the points you gain at that level.
Economically speaking, Business Select offers you great benefits, particularly if you have the extra cash flow on hand to front the cost increase.
Excellent analysis — this post was written before Southwest switched over to the new points system. I think you’re right, it’s a better deal now. You earn points at 12x per dollar on Business Select and can redeem them at 6(0)x for flights. In one example I ran, you could earn a reward flight for half the cost buying exclusively Business Select tickets vs buying only Wanna Get Away.
I read it real thorough and called. They lead you to believe is a business class ticket, but its just an expensive coach ticket, SW does suck in so many ways
Considering you can buy Rapid Rewards points for at most 3 cents each, you’d still be better off just paying a la carte for the various benefits of Business Select.
I think you also miss the point that not everyone is buying in advance or during a sale. So if you are purchasing a ticket only 3 days before the flight and it is a full Y fare for $227 – it is only $15 more. Which is a good deal for the early boarding, and the drink, let alone the bonus points. Thanks!
Absolutely right — in my new post this week I found if Business Select is within 12% of the other fare, it’s worthwhile to upgrade.
Maybe I am not seeing something, but I cannot for the life of me see how the difference between $242 and $72 is $340… I too agree that if you can afford it, the free flights come much more frequently that way and you don’t have to spend the extra on the perks you get free.
Hi Stacie, thanks for the comment. The $340 is based on the price difference for buying a round trip ticket, where the $242 and $72 values were one-way fares. Yeah I re-read that — it was definitely poorly worded! Sorry!
Does the upgrade have more leg room, and what’s the cost? I’m flying in feb 2013
The cost difference is shown in the grid when you’re pricing your tickets. There is no more leg room.
I have never flown Southwest, just seen the ads for Business Select. How does it compare tp other airline programs? Whats the difference between early bird and Business Select? It sounds like boarding for Southwest is more like a cattle call. Just wondering….thanks!
Honestly, the business select even with earning the extra point is a rip off. Yes you may gain a free one way trip for a wanna get away fare, however you are paying for it.
So if I spend 600 dollars for business select, I may be getting about 150 back through a wanna get away fare. However, even if you are getting more points, the cost isn’t worth it. You’d get more flights through want to get away fares versus through business select. Especially when you get two free checked bags and a seat on the plane regardless of boarding. Now I may be willing to pay a bit more if the seats were of better quality like the ones on airtran for their business class or if they offered more ‘free’ checked bags.
Lets do the math shall we. For instance lets say I want to fly from Milwaukee to Washington DC over fourth of July weekend.
So if I fly from the 30th of June (sunday) and return on the 7th of July (friday) A one way segment of business select or a round trip is about 670 dollars. Personally with that I’m earning about 7,512 points. Which a one way Get Away fare is going at about 6,600 points or in cash about 125 dollars.
So to do the math I pay 670 dollars-125 dollars which is 545 dollars for your round trip flight as business select. So I can spend 670 bucks for a round trip when I could spend 125 and receive about 5 one way trips off of that for the value of 670 dollars. So 125 times 5=625. I would only be receiving half of 7,512 points as the base is by 6 instead of 12. However, I’m receiving much more for my value of the dollar to pay less in cash to get a round trip flight versus getting ‘more’ points by flying business select.
I do realize that I am a bit late when it comes to this article haha, however, I think that the comments are just as valuable to a reader as the article is and since this article still seems to be pretty popular, I’ll leave my thoughts :)
So I completely agree with the author when he says that some people buy business select without some research and think they might be getting a “business class” ticket when this isn’t so. HOWEVER, if you’re anything like me and take last minute trips fairly often or just are horrible at planning and end up buying tickets the week before or even of your trip, business select is TOTALLY worth it in my mind. Lots of times, the “wanna get away” tickets are sold out and the difference between the regular ticket and business select is usually somewhere around $15. I had always figured, nah, I’m not gonna waste money upgrading, I’m a big girl, I can handle not being first on the plane! Recently though, traveling has become so frequent for me and I fly southwest most of the time. I do love southwest for many reasons, but the fact that I inevitably get stuck with the dreaded C (or low B) loading group is not one of them! Trying to get on the plane, basically carrying all of your belongings directly in front of you or above your head to avoid hitting those poor passengers in the aisle seat that look at you with faces that have undoubtedly been smacked with a diaperbag or two already, is trying. Waiting a half hour to get off the plane because for some reason getting their bag out of the overhead compartment is too complicated for some people is more frustrating than it should be. And if you’re an unfortunate soul stuck in a middle seat(well, okay maybe this is just for us heavier souls stuck in the middle seat), sitting with your shoulders practically dislocated so you dont take up too much of your neighbors space is just not okay. Getting on first is such a luxury and being able to skip the lines at security is wonderful if you have to travel at one of those terrible times.
Bottom line, if you book early enough, earlybird check in will be a suitable(and very useful) option. If you book late, like me, swallow it and spend the $15 to upgrade. You will be glad you did!
Excellent analysis — thanks for stopping by!
We flew for the first time on Southwest Airlines. We normally fly Delta. We purchased the business class. BOY were we surprised. It was like a cattle call, open seating is what they call it, but never again will we spend money with this airline. I love to fly business or first because we are older and my husband has health issues in addition to being larger. We expected two seats per row, like normal business class. NOPE, this experience was not good.
Never again.
I know this is not the most detailed or efficient comparison and does not cover all the variables but having flown Southwest for three years it shows what I have experienced. Also I did not edit this for grammatical composition , space or spelling ! SHAME on ME !
Well to sum it all up it looks like the variables are:
1. Whether or not you love SWA for whatever reason ie
Two free checked bags.
Their service vs other airlines service.
The fact they do fly from or to where you want to go when you want to go.
Or many other possible reasons. Like some of there extemporaneous commentary from the flight crew that is quite amusing at times
2. When you make your flight reservations period or when you make your flight reservations relative to cost.
Book Early and maybe BIZ Select is not so worth it.
Book Close to flight leaving and it can be worth it as it is not such a difference in cost.
3. How often you fly SWA and wish to earn free trips.
Fly often enough and not concerned about how long you wait to board or wait to get off plane?
along with how much your trips cost. then buy more trips at lower cost.
Or want to earn them faster because you are spending more on the trip ? then try Biz Select(I liked Jeremiahs example above to explain this )
(We could really complicate it by counting the number of hours in flight time and multiply it by the value of your time but really do not think you want to go that deep.)
4.How deep are your pockets and what does money mean to you? “Money is everything” vs ” Its only money!”
If money it tight and “everything” prob Biz Select(I am so tempted to call it BS) is prob not for you.
If a little earlier boarding and disembarking along with a drink makes you really excited then perhaps Biz Select is for you. (especially if you are in the “its only money group”)
5.Whether other airlines are an option and the difference in what they offer in the way of room, benefits equal or exceed what SWA offers. I dont travel often enough or to enough places to know what others offer but in general space, extra service, expedited boarding or faster security service( it depends when you fly and on whether you fly from a large small airport and how long it takes to snake through there lines) ie Seattle at heavy times vs Omaha most any time is a big difference in time going through Security.
6. Your physical ability to board and hoist your carry on baggage past and over others.
Great physical shape vs disabled may make a difference of wanting to board first or last though usually if disable I think they let you get on sooner without the extra cost.
So all in all its relative to what you value most. I know if I was making reservations close to travel time and paying nearly full cost an extra $15-20 would be worth not having to wait to get on and off the plane simply because at times I am impatient and do not like having to carry my carry on baggage up and over peoples heads.
Now IF they had not made it so efficient and have nearly every plane full or made Seattle to Reno go thru Las Vegas turning a two hour flight in to a five or six hour trip I really would be happy ! Yes! I know being full makes it less expensive (I would hope) than having the plane one third full. Besides that it allows connecting more flights possible earlier in the day in Las Vegas . . . its just that I am not doing that or really wanting to go thru Vegas.
OK. I am flying from PDX to SMF. Only two fair available. Anytime at $268 and Business select at $284. Only $16 more and see the benefits I get.
Bought a ticket roundtrip to Phoenix, a month before trip. Flight out was $285 (“wanna get away” seat). Flight back was $605 (website said that no “wanna get away” seat was availabe–had to buy “Anytime” or Business Select to get on flight). Turns out all the seats were the same. This appears to be a blatant ripoff. Has anyone considered a class action, or can airlines legally do this?
I just fell for ‘Business Select’ option at a kiosk at SEATAC airport, flying to Chicago. I mistakenly thought that, wow, now SWA offers a business class option, so I paid the extra $ 340 for an upgrade….and got…..nothing, save for a faster way through securtiy and beng in the A line. What a blatantly deceptive business practice to scam customers. I called SWA and they said I ‘should have known’ and I responded that I did not have any idea if SWA used the same airplanes or configuration and thought they were now offering a new option. Yay ! Now, I feel very deceived as upgrade to Business is a standard that other airlines have in common in providing. SWA would not budge. I won’t fly with them again. I feel very deceived. At least on the kiosk they should have had a warning that Business Select with SWA does not give you a Business Class seat. Geezzzzz…..They lost me as a customer who spends many thousands of dollars a year for a measly $ 340. So much for the customer comes first ! Paul
I was one of the unsavy travelers who just assumed that if I was paying three times more for a ticket I would be getting something for it. Specifically, I wanted to avoid “general admission” seating, get a wider seat, more leg room, maybe even a meal. What a surprise. For $700 extra I had two shorter lines and a drink coupon. Wow. I will never fly SWA again.
I called SW to upgrade 4 tickets to business class. That’s exactly how I said it – business class. The agent did not say, “Sir, we don’t have business class, but I can give you business select.” Instead, she sold me 4 upgrades at over $300 each so my family could be first in line and each get a free beer. I consider this to be a deceptive business practice and will be complaining high and low as soon as this trip is over.
…even Spirit have a better value for business class… I flew OAK/LGA.. almost 7 hs fly in a very narrow seat… it’s a completely rip off.. yes, my bad, I tough “business class” means the same in all airlines..
The fact SW allow choose your seat, it’s a very bad thing.. I come late at gate and ended at the end of the plane, aisle.. I hate paid so much for nothing!!
And the coupon for beer or wine.. passenger next to me got beer without payment or coupon (in fact, nobody asked me for the coupon..) so… I gonna be more careful next time but again.. the wide seat on Spirit is much, much better…
Southwest offers cattle-car class, and cattle-car class with a modicum of pretense and an included drink. I wouldn’t consider them for any flight exceeding an hour and a half, and even then only in an emergency.
Ohwell. This Kiwi just fell for the South West Airline facade aswell. Oh dear, nevermind, lesson learnt. But the lure for me was the two free checked bags per customer. Mind you it beats the hell out of a 24 hour plus Greyhound bus trip with a smelly toilet in the rear of the bus.
South West I detest your customer scamming practises.
New Orleans here we come. Make sure our hotel room is comfortable. We’re gonna need a good rest after flying South West Air so called “Business Class”.
I fly SWA all the time, nearly every destination I’ve gone to it is cheaper to go on an SWA wanna get away fare than any other option especially if you can book early and book during a sale time. As far as business select goes the real value of the ticket falls with those that want the points, the drink is nice and the priority boarding is nothing new when you’re A-List or A-List preferred, but it is true that other than reward points you’re not getting much for your business select ticket. I am an A-List flyer and typically only purchase business select when I need those extra few tier qualifying points to re establish my A list. Their A list program is great because you never have to worry about C class or waiting in line to check a bag or board the plane and you can do that without purchasing business select or early bird. So if you need those extra few points for your next free flight or to get A-list or A-list preferred, business select gives you more points per dollar, other than that stick to wanna get away
I’m assuming people are forgetting the point of “*Business* Select.” The reason for this upcharge is a lot more lucrative. First, if you are booking 2 days in advance, you are forced to purchase these more expensive tickets. Second, there are some people who prefer the benefits of these tickets and can (*Might be able to*) afford them. Third, (The “Business” part) the expensing structure of companies. When they are spending their companies money, some people are not worried about fiscal responsibility. Also, you get to keep the rapid rewards points (Free vacation).
Business Select makes sense if other people (like your employer) are paying for it. It’s always fun to stick it to your employer, forgetting that without your employer you wouldn’t have a job.
Hope you can clarify for me:
SW is the only airline flying direct from home to destination. I’ll be making that trip four or five times a year for the next three+ years with specific dates determined about a year in advance.
My preference is always non-stop flights, hence why I’m willing to try SW.
So… should I get Early Bird Seating, Biz Select, or just the regular ticket?
Thanks for your help!