As the coronavirus outbreak spreads, more flights are getting cancelled and fewer people are travelling. Demand for leisure travel is weak, some countries have imposed travel bans, and many corporate travellers are grounded as businesses impose their own travel restrictions. As a result, many airlines and hotels – especially in the Asia-Pacific region – are struggling.
In recent days, many airlines and hotel chains have announced that they will extend the status of their customers for a year due to the current coronavirus situation.
Singapore Airlines, which has already cancelled many flights to China and reduced flights to other destinations worldwide until at least the end of May, is one airline that has already started extending the status of KrisFlyer elite members. In light of the current situation, Singapore Airlines has proactively emailed long-time KrisFlyer members whose status is due to expire soon, promising year-long status extensions. At this stage, these offers appear to be targeted and may not be open to everybody.
Cathay Pacific has also announced a plan to help Marco Polo Club members that have been grounded – and therefore unable to earn club points – in recent months due to flight cancellations and travel restrictions. Cathay Pacific will award additional “relief” club points to members in February, March and April, respectively. The amount of bonus club points issued depends on the member’s tier status. Lounge passes due to expire during those months will also be extended by six months. Cathay Pacific and its regional subsidiary Cathay Dragon have been forced to cancel more than half of their worldwide flights during February and March this year, and further cancellations are likely.
Numerous hotel loyalty programs have also offered to extend the current status levels of elite members affected by the current travel restrictions. Marriott Bonvoy, Hilton Honors, IHG Rewards Club and Accor ALL are each extending the status of members that live in mainland China, Hong Kong, Taiwan or Macau by one year.
Meanwhile, World of Hyatt will extend the status and expiration of points for members that live in or regularly travel to the Asia Pacific region. This includes residents of Australia and New Zealand.
The Shangri-La Golden Circle loyalty program has also announced status extensions due to the COVID-19 outbreak. Shangri-La is extending the tier status of all current Jade and Diamond members globally until 31 December 2021.
Why are travel companies offering status extensions?
There are numerous reasons that businesses might choose to offer status extensions to their loyal customers in light of the current coronavirus situation. The main reason is to create goodwill and ensure that program members aren’t disadvantaged if they temporarily can’t travel due to reasons beyond their control.
Hyatt, for example, justifies the status extension by saying it’s “a priority for us to stay close to our World of Hyatt members, understand how their lives are impacted and help”.
“Extending the expiration of elite tier status and benefits for our members is one of the ways we can care for our most loyal guests, so they have one less thing to worry about during this incredibly difficult time,” said Amy Weinberg, senior vice president of World at Hyatt.
Loyalty programs want members to remain engaged. They also want to ensure the “golden handcuffs” of status are still there when their members are once again able to travel. These loyalty programs are probably concerned that their most valuable customers could decide to try out the competition if they lose their elite status.
British Airways famously extended the status of British Airways Executive Club members that were affected by the company’s major IT meltdown in 2017 by two years. This catastrophe was so badly handled, and so damaging to the British Airways brand, that the company was terrified it could lose its most valuable customers if it did nothing. (You might be noticing a common theme here…)
Should Qantas and Virgin Australia follow suit?
It is likely that more loyalty programs in the Asia-Pacific region will make similar announcements in the coming weeks and months. But should Qantas and Virgin Australia offer status extensions to travellers affected by the current coronavirus outbreak and associated travel restrictions?
Some AFF members believe they should…
Hi All, wondering what the hive minds view on QFF offering a status pause due to CV-19 is. I do most of my travel within Asia and my work has banned travel til unknown time. I think that QFF should offer status pauses like they do when having children.
Others believe it’s very unlikely Qantas or Virgin will extend members’ status due to coronavirus…
No I don’t think they will and I don’t think they should.
I think all international travel would have to be banned for a long time for that to happen.
One AFF member believes that Qantas and Virgin will have no choice but to react to the situation – but that status extensions won’t be part of that.
Coronavirus will enormously thin out the ranks of elite flyers in QFF (and CX for that matter).
Many corporate travel bans on China (Australia’s largest trading partner by an order of magnitude) with the possibility of extending it to HKG and SIN.
It’s going to be terrible for Qantas, so expect some creative offerings from Qantas to drum up business. But a status pause won’t be one of them because it doesn’t generate any extra revenue for them.
Australia is (obviously) less impacted by the coronavirus outbreak than places like mainland China and Hong Kong. However, even Qantas and Jetstar have cancelled international flights. And many Australian companies have started banning or reducing overseas travel. This will inevitably result in many loyal frequent flyers losing their elite status. If airlines don’t offer some sort of incentive to stay loyal, they risk losing these valuable corporate travellers for good – a prospect that terrifies Singapore Airlines, Cathay Pacific and the many hotel chains that have already announced generous elite status extensions.
Qantas has already released a double status credits offer to stimulate travel demand in the current environment. It remains to be seen whether Qantas or Virgin Australia will do any more.
Join the discussion on the Australian Frequent Frequent Flyer forum: Covid-19 – status pause
