[Confirmed] QF removing [cheap] ASAs [from web booking engine Jun 26] was 10April

[asg29e]

Re: [Confirmed] QF removing [cheap] ASAs [from web booking engine Jun 26] was 10Apri

NewK and medhead – You’re missing the interplay of classic award seat availability and the cash prices offered on the other seats on a particular flight.

Revenue management make those (say) 5% of classic award seats available because their analysis and yield management means they don’t expect to sell them as revenue fares. The prices for the 95% of cash seats are set to cover flight costs and margin on this ‘unsold inventory’ assumption. The revenue they get from selling classic award seats to FF is marginal revenue for the flight if someone chooses to redeem a classic award..

Supersonic Swinger, your argument is persuasive, but one thing the yield management gurus may not have considered is that virtually NOBODY treats QFF points as a cash equivalent. (At least nobody properly engaged with this forum.) And I don't think quadrupling the price of a xASA will change that. I know of nobody on this forum who would be silly enough to burn a million points or so for a so called "any seat award" flight that can be booked on-line, one way to Europe.

So how are our points all going to be burned, if its not on toasters, gift cards and on-line points + pay flights? Clearly the answer is classic awards and upgrades. So, if there is an decrease in xASAs (and I mean the proper pre June ones here) there may well be an increase in classic award redemption, all out of the same fare bucket. So I think Medhead's argument does hold a little bit of water at least.

I just cannot see a major upswing in full cost point + pay type redemption because of these changes. I think it is more likely people will simply direct their credit card spend to FF programs which provide better availability and cheaper redemption than Qantas. ie just about anywhere else.

Mind you, I'm not a yield management expert so what would I know?

 

[medhead]

Re: [Confirmed] QF removing [cheap] ASAs [from web booking engine Jun 26] was 10Apri

NewK and medhead – You’re missing the interplay of classic award seat availability and the cash prices offered on the other seats on a particular flight.
.

No we are not because it simply is not relevant. Buying a classic award as an ASA depletes the classic award bucket. The ASA comes from the 5% for classic awards. It does not take a revenue seat and the interplay with other seats does not come into it. If they are willing to sell a seat as a classic award then there is no reason, in principle, to not accept the same return for the same seat as an ASA.

The only difference with the ASA is the earning on top. As long as they recover the appropriate cost of that earn. Jetstar already provide an indication of the cost of buying earning on flights. As with jetstar bundles people will pay more to earn.

You're missing the point that the cheap ASA are attractive for the earning. If they are not available then people are going to buy a classic award and forgo the earning rather than stump up a million points to grab a revenue seat.

 

[fairbasa]

Re: [Confirmed] QF removing [cheap] ASAs [from web booking engine Jun 26] was 10Apri

Supersonic Swinger, your argument is persuasive, but one thing the yield management gurus may not have considered is that virtually NOBODY treats QFF points as a cash equivalent. (At least nobody properly engaged with this forum.) And I don't think quadrupling the price of a xASA will change that. I know of nobody on this forum who would be silly enough to burn a million points or so for a so called "any seat award" flight that can be booked on-line, one way to Europe.

So how are our points all going to be burned, if its not on toasters, gift cards and on-line points + pay flights? Clearly the answer is classic awards and upgrades. So, if there is an decrease in xASAs (and I mean the proper pre June ones here) there may well be an increase in classic award redemption, all out of the same fare bucket. So I think Medhead's argument does hold a little bit of water at least.

I just cannot see a major upswing in full cost point + pay type redemption because of these changes. I think it is more likely people will simply direct their credit card spend to FF programs which provide better availability and cheaper redemption than Qantas. ie just about anywhere else.

Mind you, I'm not a yield management expert so what would I know?

I agree with this, it's similar to what I said previously.

I don't see Classic Awards as valuable because of the crazy taxes and surcharges attached with no SCs etc. This means I can basically only use my points on upgrades.

Everyone will argue "But no other airlines offer xASAs" and that is true, but their Frequent Flyer programs are better value otherwise than Qantas'.

 

[medhead]

Re: [Confirmed] QF removing [cheap] ASAs [from web booking engine Jun 26] was 10Apri

Summed up perfectly.

Except for the incorrect assumption that classic award fare as ASA consume a revenue seat. They don't, they consume the classic award seats that are, apparently, thrown away.

 

[Supersonic Swinger]

Re: [Confirmed] QF removing [cheap] ASAs [from web booking engine Jun 26] was 10Apri

No we are not because it simply is not relevant. Buying a classic award as an ASA depletes the classic award bucket. The ASA comes from the 5% for classic awards. It does not take a revenue seat and the interplay with other seats does not come into it. If they are will to sell a seat as a classic award then there is no reason to not accept the same return for the same seat as an ASA.

Sorry, I've tried to explain as best I could that the availability of the classic award bucket is determined by the airline's expectations how many revenue seats it can sell. The airlines definitely think it is relevant, although it'd probably be best chatting with someone who works in yield management for an airline.

You're missing the point that the cheap ASA are attractive for the earning. If they are not available then people are going to buy a classic award and forgo the earning rather than stump up a million points to grab a revenue seat.

Again, that's from the perspective of a frequent flyer, not an airline's management who are negotiating wafer thin profit margins. They want you to pay for an actual seat if you can't get a classic award (or do as many other airlines do, open up availability at much higher points levels, but without being eligible for points or status credit).

 

[Supersonic Swinger]

Re: [Confirmed] QF removing [cheap] ASAs [from web booking engine Jun 26] was 10Apri

Except for the incorrect assumption that classic award fare as ASA consume a revenue seat. They don't, they consume the classic award seats that are, apparently, thrown away.

The number of seats available for a classic award are not fixed on any flight. They are dynamic during the period the flight is available for booking. If someone was to come along with a group booking for every seat on a flight, yield management would make the classic seats disappear to get the cash in the door. If there's a load of seats unsold just before departure, they may release extra seats as classic awards.

 

[Supersonic Swinger]

Re: [Confirmed] QF removing [cheap] ASAs [from web booking engine Jun 26] was 10Apri

So how are our points all going to be burned, if its not on toasters, gift cards and on-line points + pay flights? Clearly the answer is classic awards and upgrades.

Unfortunately if they do away with cheap ASA's over the phone, that will be the case. It's the way pretty much every other airline gets you to burn them.

I think it is more likely people will simply direct their credit card spend to FF programs which provide better availability and cheaper redemption than Qantas. ie just about anywhere else.

I already have, getting amazing value out of AA miles. Although once they merge, who knows what will happen with their program.

 

[ketsuzei]

Re: [Confirmed] QF removing [cheap] ASAs [from web booking engine Jun 26] was 10Apri

If someone was to come along with a group booking for every seat on a flight, yield management would make the classic seats disappear to get the cash in the door.

And the cheap ASAs would also disappear.

If there's a load of seats unsold just before departure, they may release extra seats as classic awards.

And then the cheap ASAs would reappear.

 

[Newk]

Re: [Confirmed] QF removing [cheap] ASAs [from web booking engine Jun 26] was 10Apri

And the cheap ASAs would also disappear.



And then the cheap ASAs would reappear.

Plus the extra price that might make both yield management and customers happy. Medhead should be running the bloody company

 

[MEL_Traveller]

Re: [Confirmed] QF removing [cheap] ASAs [from web booking engine Jun 26] was 10Apri

No we are not because it simply is not relevant. Buying a classic award as an ASA depletes the classic award bucket. The ASA comes from the 5% for classic awards. It does not take a revenue seat and the interplay with other seats does not come into it. If they are willing to sell a seat as a classic award then there is no reason, in principle, to not accept the same return for the same seat as an ASA.

The only difference with the ASA is the earning on top. As long as they recover the appropriate cost of that earn. Jetstar already provide an indication of the cost of buying earning on flights. As with jetstar bundles people will pay more to earn.

You're missing the point that the cheap ASA are attractive for the earning. If they are not available then people are going to buy a classic award and forgo the earning rather than stump up a million points to grab a revenue seat.

exactly... CHEAP ASAs are the same as a classic award, same inventory, but represent an increase of income for QF (the higher cash component). in exchange for the increased revenue you get SCs and points.

i argued this some time ago that cheap ASAs are a simple equivalent of a jetstar bundle.

the only real discrepancy (which applies to jq bundles as well) is that a platinum FF is charged the same bundle fee as a bronze FF, but gets double the miles.

 

[Supersonic Swinger]

Re: [Confirmed] QF removing [cheap] ASAs [from web booking engine Jun 26] was 10Apri

And the cheap ASAs would also disappear.

And then the cheap ASAs would reappear.

Plus the extra price that might make both yield management and customers happy. Medhead should be running the bloody company

Aargh, I give up trying to explain, I'm bowing out of the thread

 

[amaroo]

Re: [Confirmed] QF removing [cheap] ASAs [from web booking engine Jun 26] was 10Apri

You're missing the point that the cheap ASA are attractive for the earning.

It seems to me that QF have intense focus on this. That's why they changed it.

Same as all the other lurks that have been pulled recently:- W'field GC, WOW select runs, ANZ/NAB bonus point transactions, ATO earn with AMEX/CITI, etc, etc, etc

QFF had plenty of elite flyers well before ASA came into play......

 

[Newk]

Re: [Confirmed] QF removing [cheap] ASAs [from web booking engine Jun 26] was 10Apri

It seems to me that QF have intense focus on this. That's why they changed it.

Same as all the other lurks that have been pulled recently:- W'field GC, WOW select runs, ANZ/NAB bonus point transactions, ATO earn with AMEX/CITI, etc, etc, etc

QFF had plenty of elite flyers well before ASA came into play......

Ah. But another point of view is that they do indeed sell points and credit bundles on JetStar.

 

[amaroo]

Re: [Confirmed] QF removing [cheap] ASAs [from web booking engine Jun 26] was 10Apri

Except for the incorrect assumption that classic award fare as ASA consume a revenue seat. They don't, they consume the classic award seats that are, apparently, thrown away.

That's like saying there are empty J seats - why doesn't QF upgrade me?

Cannibalisation does not provide for a long and prosperous life.

 

[amaroo]

Re: [Confirmed] QF removing [cheap] ASAs [from web booking engine Jun 26] was 10Apri

Ah. But another point of view is that they do indeed sell points and credit bundles on JetStar.

IMO that's the only carrot they can offer to get SC hungry QFF members to fly the orange cancer......this is something QF doesn't have to worry about as the cheapest flights always pays at least 10SC.

Would be interesting to see the numbers.....having flown 300+ sectors (MCY-SYD-MCY) on J* (earning 20SC per sector) my gut feel - bugger all people cough up the extra coin.

 

[equus]

Re: [Confirmed] QF removing [cheap] ASAs [from web booking engine Jun 26] was 10Apri

It seems to me that QF have intense focus on this. That's why they changed it.

I am not so sure that is really the case. With the demonstrated expertise at rolling out quality IT solutions for their website (lol) I am more inclined to believe that the different "base" (classic points rather than dollars) was just too hard to get right in the new front end - so was left off. More incompetence rather than conspiracy.

 

[markis10]

Re: [Confirmed] QF removing [cheap] ASAs [from web booking engine Jun 26] was 10Apri

I am not so sure that is really the case. With the demonstrated expertise at rolling out quality IT solutions for their website (lol) I am more inclined to believe that the different "base" (classic points rather than dollars) was just too hard to get right in the new front end - so was left off. More incompetence rather than conspiracy.

They admitted the marginal ones were up for review, given the term I think its more than IT.

 

[equus]

Re: [Confirmed] QF removing [cheap] ASAs [from web booking engine Jun 26] was 10Apri

They admitted the marginal ones were up for review, given the term I think its more than IT.

Undoubtedly. But the IT costs of addressing them (or the call centre costs of the manual approach) may be a substantial contributor to the "marginality".

 

[medhead]

Re: [Confirmed] QF removing [cheap] ASAs [from web booking engine Jun 26] was 10Apri

Sorry, I've tried to explain as best I could that the availability of the classic award bucket is determined by the airline's expectations how many revenue seats it can sell. The airlines definitely think it is relevant, although it'd probably be best chatting with someone who works in yield management for an airline.

And I've tried to explain a number of times is that this has nothing to do with how they set the number of classic awards. There is absolutely no suggestion of changing how the number of classic awards are set. They set the availability of classic awards by whatever method, then the awards are sold either as classics or, in the past, as an ASA. For the purpose of my point how they set classic award availability is irrelevant, even if it is of great interest to a manager somewhere. To repeat they do not have to do anything different in set their classic awards via yield management. It is a very simple concept and I'm not going to bother trying to explain to you again.

Again, that's from the perspective of a frequent flyer, not an airline's management who are negotiating wafer thin profit margins. They want you to pay for an actual seat if you can't get a classic award (or do as many other airlines do, open up availability at much higher points levels, but without being eligible for points or status credit).

Unfortunately, it is the frequent flyer who management are trying to get to buy their products. The frequent flyer perspective is very important for them to negotiate their wafer thin margin.

However yet again you are jumping ahead of my point to revenue. I'm not talking about "if you can't get a classic award". I'm talking about when you can get a classic award. When you can get a classic award, it used to be that you could also get an ASA. I'm sure a manger playing with a wafer thin margin would be more than happy to get another couple of hundred dollars for a seat that would otherwise walk out as a classic award (without that extra cream). We already see that jetstar do this, and they explicitly state on their website that the bundle is there to pay for the cost of earning. It is just a matter of qantas making sure they set a margin to get the required cream on top of what would otherwise be a classic award.

Then once all the classic awards are gone the manager can worry about getting me to buy a revenue seat. But then once the classic awards are gone my point no longer applies, it becomes irrelevant.

 

[Newk]

Re: [Confirmed] QF removing [cheap] ASAs [from web booking engine Jun 26] was 10Apri

And I've tried to explain a number of times is that this has nothing to do with how they set the number of classic awards. There is absolutely no suggestion of changing how the number of classic awards are set. They set the availability of classic awards by whatever method, then the awards are sold either as classics or, in the past, as an ASA. For the purpose of my point how they set classic award availability is irrelevant, even if it is of great interest to a manager somewhere. To repeat they do not have to do anything different in set their classic awards via yield management. It is a very simple concept and I'm not going to bother trying to explain to you again.



Unfortunately, it is the frequent flyer who management are trying to get to buy their products. The frequent flyer perspective is very important for them to negotiate their wafer thin margin.

However yet again you are jumping ahead of my point to revenue. I'm not talking about "if you can't get a classic award". I'm talking about when you can get a classic award. When you can get a classic award, it used to be that you could also get an ASA. I'm sure a manger playing with a wafer thin margin would be more than happy to get another couple of hundred dollars for a seat that would otherwise walk out as a classic award (without that extra cream). We already see that jetstar do this, and they explicitly state on their website that the bundle is there to pay for the cost of earning. It is just a matter of qantas making sure they set a margin to get the required cream on top of what would otherwise be a classic award.

Then once all the classic awards are gone the manager can worry about getting me to buy a revenue seat. But then once the classic awards are gone my point no longer applies, it becomes irrelevant.

don't worry, at least I understand,

But as asg29e said: I ain't no yield surgeon, errrr rocket manager