Invited to participate in a QF Loyalty Virtual Focus group

[Lynda2475]

Personally I think P1 should be the same as other QFF levels and reserved for BIS activities only.

Assuming BIS = Butt in Seat then I agree.

 

[Himeno]

They didn't ask for suggestions for a new head of QF Loyalty?

 

[SYD]

They didn't ask for suggestions for a new head of QF Loyalty?

Too soon?

 

[levelnine]

Thanks for such a detailed summary, that was truly interesting to read. Really gives you an insight into how bad some of these consultants are with idea generation. More QF branded key rings? Seriously ....

The 1 million points for P1 is a very interesting idea. My guess is it is yearly earn — it would be way too easy if it were simply a balance of 1 million points. Spend for status would take Qantas well and truly down the path of the American carriers. The figure seems about right. For $USD200K ($AUD315K) card spend, you can earn top tier American status, and for $USD350K ($AUD555K) card spend, you can earn top tier Delta status. But crucially in the US, sign-up bonuses don't count.

 

[Daver6]

The QF valet parking vouchers would actually be something I'd value (assuming it's not just 10% of or $30 kinda thing).

Getting a pile of points or decent amount of SCs instead of the QP membership for PC+ could also be interesting too. Do those points count towards PC earn too?

 

[RooFlyer]

Many thanks for taking us along @Seat0B . Did you get any hint that there might be other focus groups with things other than Points Club their focus?

I've never been a fan of Points Club - a dilution of the concept of "flying" to get perks by the airline and of course the encouragement of the generation of yet more non flying points to compete with those of actual flyers.

 

[RichardMEL]

Great summary - thank you so much for taking the time to follow up (as well as taking the myriad of suggestions into the meeting!).

It does reveal where the thinking is at. I find it interesting that the majority of the (OK, group of 6) people seemed to not worry about PC/PC+ too much = as in knowing they got it when notified and it seems not overly fussed to chase it (I know some do for things like the 100 SC rollover and reward flight earnings of course).

I do find the mix of status members intersecting with PC "status" members interesting - if they were focused on examining the impressions and thoughts on PC/PC+ I would have thought they'd actively avoid higher status members as that might dilute the impressions of benefits that involve SC's (like the DSC on birthday offer etc). Just my initial 10 second thoughts on that though.


As for the "1 millions points for P1"? Yeah, it would have to be in a year.. but sorry.. really? As a P1 for near 10 years who has earned it the hard way (and of course extensions and via DSC too) this seems ridiculous - the points churners, and I imagine reasonable SME owners and higher could generate that in a year pretty easily and this would potentially dilute the P1 membership base. Far better, imo, to create a PC++ tier (which had been mooted a while back iirc) that could have some P1 like perks, but not all of them imo. Seems like a loophole into very high status perks for some. One would hope if this is a serious or likely thing that QF has done the numbers and know how many or few actually meet this criteria - who aren't already P1 or CL. imo.


IMO as for the ideas to make it "better" - PC was supposed to be all about ground spenders getting something useful - so I think they should follow that theme - and yes, offer things like the movie vouchers, gifts for shopping, discounts etc rather than more air travel related ones. I do quite like the idea of PC loyalty bonuses that could kick in after initial qualification. eg I earned 250k PC points last year - so not enough for PC+, but a fair number above qualifying - getting "something" for that might be something. Would I chase the option to get a $50 voucher for something? probably not... but maybe some would.

Again, thanks for the great summary!

 

[Seat0B]

Many thanks for taking us along @Seat0B . Did you get any hint that there might be other focus groups with things other than Points Club their focus?

I've never been a fan of Points Club - a dilution of the concept of "flying" to get perks by the airline and of course the encouragement of the generation of yet more non flying points to compete with those of actual flyers.

No all the groups were dealing with PC and PC+

Post automatically merged: Oct 16, 2023

The QF valet parking vouchers would actually be something I'd value (assuming it's not just 10% of or $30 kinda thing).

Getting a pile of points or decent amount of SCs instead of the QP membership for PC+ could also be interesting too. Do those points count towards PC earn too?

It seemed like it was going to be $50 off for PC and $100 for PC+

 

[DC3]

Qantas World Platinum is officially called Qantas Platinum but I and other people I know refer to it as World Platinum given the many benefits such status unlocks globally.

 

[aus_flyer]

Hard no to giving P1 to high points earners. The number of members would surely grow significantly - thus diluting the base.

 

[levelnine]

Hard no to giving P1 to high points earners. The number of members would surely grow significantly - thus diluting the base.

Easy fix for that. Double or triple the SC thresholds for people who earning status the antiquated way — by flying .

In all seriousness, it's only a matter of time before Qantas go down that path. You're just a dollar figure to an airline — they don't really care whether that figure is attained through selling you points or selling you seats on a flight.

Indeed, there is far more growth opportunities for Qantas in the credit card market than there is in the airline market. Qantas Group has 60% of domestic airline market share with very little scope for expanding that figure without entering a perilous price war.

But it only has about 30% of consumer credit card market spend. If they tied status to card spend, they could easily increase that figure by 10 or 20%. There's huge growth opportunities for Qantas in the points business. In the US, a staggering 1% of the country's entire GDP is put through Delta-branded cards.

 

[Flyfrequently]

Warning: Long post summarising the focus group.

OK, well that was interesting.

There were 6 of us on the call (plus the facilitator from an outside market research company). 4 x platinum and 2 x gold FF, 3 x PC+ and 3 x PC. Age range from 30s-70s. Three working, 2 retired and me (semi-retired). The main focus of the call was improvements to PC and PC+ - which is a pity as although that certainly needs improvement, it's definitely not my main gripe with QF. It was quite tightly stage managed, but still, I managed to get in a few points from the list above, and interestingly enough, there was a very clear agreement amongst all of us on the call on similar points.

They asked us how we came to know about PC and PC+

• For all of us it was not an active thing, we just got notified we had achieved it.

They asked us how much effort we made to keep PC and PC+

• For all except one the answer was not much effort at all, because the benefits are so marginal when you are a higher tier FF as well that it isn't really attractive to make an effort. We did however all agree that the various SC benefits of PC and PC+ such as the SC rollover for PC+ and the SC on CR seats for PC and PC+ did make it generally attractive and that if these benefits were improved/increased we would be likely to try harder. Four of us managed to get into the conversation that getting SC on CR seats was only going to work if you could actually get an award seat, and that at the moment that was all but impossible. Actually that point was made several times over the course of the focus group.
• Several people also noted that the points levels needed were getting harder to achieve given the recent round of devaluations of credit card points earning, and the tigher conditions impacting credit card churning and the three retirees also pointed out that credit cards are not really an option in retirement.

We were then asked questions about whether we used each of the benefits of PC and PC+.

• For most of us the answer was "no, because I already get this some other way" eg QP invitations or QP membership not relevant to status fliers, Accor ALL silver irrelevant to most as already have Accor Gold from previous promo, Accor Advantage plus or enjoy status with other hotel groups, Avis upgrade not especially attractive and the one person who had tried to use was refused by Avis, $50 wine voucher not really useful as most of us only buy QF wine on discount and therefore can't use the voucher which is only for non-sale items, $50 hotel voucher also not really useful as most time QF Hotels are more expensive than other providers.

They asked us to suggest things that would make us want to make an effort to keep PC/PC+ or upgrade between PC and PC+ and some good suggestions were made by the group. These included:

• make SC rollover 100 SC for PC and 200 SCfor PC+.
• give a loyalty bonus offer for PC in the same way as given for FF - so say every 50,000 points you could choose 8,000 FF points or 50SC.
• provide earlier access to CR seats - only 2 supported this - the rest of us did not want to be competing with an even bigger pool of people to get those unicorn J international seats. This led to a lot of discussion about the need for better seat availability, and I got to slip in "yeah no one really wants all those economy reward seats on Jetstar between MEL and OOL". This was immediately picked up by the others who basically said yep, totally agree, international J is what we want.
• first class lounge invitations.
• one chance each year, say for birthday or PC/PC+ anniversary to make a personalised DSC booking - for PC this could be domestic maybe and for PC+ international.
• ability to make changes/cancellations to CR bookings without paying the points penalty at least for 1 or 2 bookings per year.
• ability to gft any of the PC/PC+ benefits to a family member.

The we were shown a prepared list of "enhancements" being considered by QF. These included:

• merchandise to celebrate achievement of PC/PC+ such as key ring, PJs etc. This was not attractive to anyone in the group "I already get this" "I don't want more branded junk"
• personal greeting by cabin crew for PC PC+. This was not well received with everyone agreeing that the current greetings are cringe worthy and don't add any value at all, and often just done "performatively to tick a box". We all agreed that something better would be a glass of better wine, some food from a higher cabin or similar.
• Amenities kit when flying Y on a flight with premium cabins. All except one thought this was a fair enough idea, and similar to the suggestions already made in relation to the personal greeting.
• Better discount on points flights (both points plus pay and CR) - but level of discount not revealed. People thought this was a good concept, but likely to be mean and scrimpy and not of any real attraction given the low levels of other points/discounts offered.
• Priority boarding for PC/PC+. This was widely rejected as "soon the whole plane will be priority boarding" and "QF can't ven manage the current priority boarding, why make it worse".
• Points millionaires to get P1. This generated a lot of discussion. Does this mean a points balance of 1 million or that ypu have to earn 1 million in a year? The consultant said it was a points balance of 1 million. Well I'd be in favour of that - but I'm pretty sure that is not what they mean. Most of the focus group also thought it was likely to be earn 1 million in a year, which several then equated to the total insulting irrelvance of the illusion of LTP and the inability of almost anyone to actually achieve this. However, one person said it made sense to them that it was the points balance because that would mean that people would then want to keep a balance of 1 million points to keep P1. Therefore the demand for ways to spend points would decline and everyone would be better off, including Qantas as they would not have to give up much to lock up a million points that could otherwise be exchanged for a whole lot of J and F international flights (assuming you could get them). People with fewer points might decide to save them to get to the million mark. And those who wanted to spend their points would now have less competition for the available seats. I quite liked this way of thinking, and I hope QF does too (she says with a very healthy points balance, and also Mr Seat 0A). I wonder how many people actually have 1 million or more points? I'm sure a lot here do, but overall, I wonder how many. On FB I see so many posts with people saying "I have a heap of points, almost 200k" so maybe there are not that many with million or multi-million point balances?
• Free subscription to AFR (yes really!!!)/Australian/SMH. This was rejected as not much value and the group said, but a free subscription to a decent streaming platform would be attractive.
• Valet parking vouchers.
• And I forget the rest, but honestly they were not particularly attractive.
• We were asked to specify our favourite 3 things, and I have highlighted the ones that were mentioned by the group.

Next we were shown some more ideas by QF which basically involved allowing the PC/PC+ member to select any 2 of a list of the current benefits such as hotel voucher, wine voucher, or new benefits such as car rental discount voucher, insurance discount voucher, 2 x hoyts movie tickets, Westfield valet parking, QF valet parking. Voucher value was $50 for PC and $100 for PC+. PC+ also got a QP membership or 150,000 points, or an unspecified number of SC or an unspecified number of First Lounge invitations. The also suggested a loyalty bonus at 250,000 points - 2,500 points or 10 SC.

• The group thought that overall it was attractive to be able to select the benefit you wanted.
• The group thought that overall these benefits were pretty cheap and nasty given how much you have to spend to get PC or PC+ membership especially if you cannot do the credit card churning. One member of the group pointed out that for 500 SC of flying you currently get an offer of 8000 points or 50 SC and that this was nowhere near what was being offered for the improved PC/PC+ (2500 points of 10 SC).

At the end we were asked again how much effort we would put into achieving/maintaining/upgrading PC or PC+. No one had changed their opening position which was basically "meh - if I get it I get it, it's OK, but I would not really exert myself to get/maintain or upgrade." Other comments were along the lines of "just stop with the shopping list of bitsy offers that aren't attractive and have 3 or 4 really fantastic benefits that wow people into spending their cash in ways that generate QF points" and I said that in fact I now felt more negative than when I started the session today. This is true as I realised how much money has to be spent these days to generate 150,000 QF FF points, and then they offer me a bunch of things I already get (lounge access, Accor ALL silver), don't want (Avis upgrade, piddling discounts on their overpriced online store, voucher on overpriced hotels) or can't use ( wine discount, QF travel insurance - my pre-existing conditions are not all covered, and my free credit card insurance is actually better value plus covers all conditions except the recent leukaemia). The only actual benefit I get as PC, and I do value it, is the SC earn on CR flights, but realistically I would be better to just spend money and buy flights and get the full SC. And it is really, really hard to get those CR flights in the first place, so.....

I hope this summary is of interest to the group, and happy to keep the conversation going on here if people are keen.

Excellent effort and thanks for comprehensive summary @Seat0B , hopefully you were "heard".

 

[Mr H]

I am slightly puzzled by the focus group if it was aimed at how to encourage Gold and Plats to engage with PC. They are already engaged with an airline programme that is significantly better than PC. If that's not enough to get them to steer business Qantas's way then nothing will.

As for people earning 1,000,000 points a year... That would be worth approximately $5000 to Qantas - based on selling points for about 1.1 cents per point and redemptions costing Qantas about 0.6 cents per point. Given that there would be very few million pointers, and they would probably have been amassing points anyway, it is hard to see where the extra value would be coming from. The current modest level of rewards is surely indicative of what Qantas thinks it is worth to encourage a few whales to collect more points.

 

[Flyfrequently]

They didn't ask for suggestions for a new head of QF Loyalty?

I put forward @Seat0B to replace Olivia

 

[levelnine]

it is hard to see where the extra value would be coming from.

Turning the 60% of Australians who don't give a cent of their credit card spend to Qantas into Qantas point fiends.

Go full revenue and have a single simple metric that any Australian can understand with very clear rewards — earn 25K QFF points in a year and get two free lounge passes, earn 50K and get a discount voucher on Qantas flights etc etc.

In that way, Qantas have a lot to learn from Coles & WW. Get a Qantas rewards card into the hands of pretty much every Australian and make it an instinctual response to swipe it for every transaction for clear, tangible benefits.

Australians absolutely love their loyalty programs. While everyone is pretty much a QFF account holder, too many people still think the only way to get benefits out of the program is by flying.

 

[Mr H]

Turning the 60% of Australians who don't give a cent of their credit card spend to Qantas into Qantas point fiends.

And I very much doubt that they will solve this problem by asking gold and platinum members what rewards they would expect from earning a million points.

 

[levelnine]

And I very much doubt that they will solve this problem by asking gold and platinum members what rewards they would expect from earning a million points.

It's the start of a reverse takeover process. My money is on PC eating the main QFF program in the next 5-10 years. PC becomes more and more spend for status then is merged into, and replaces, the main QFF program.

The point of these early feelers is to gauge at what level they might be able to set the spend tiers. No point setting it at a level that drives away your main base. Then you get the worst of both worlds — too high to attract new people and offensive to the main base, causing them to disengage (see Delta's recent program changes that are about to be walked back). You have to set the tiers at a level that isn't wholly offensive to the main base. You also have to start sowing the seeds that tiers are earned through spend rather than flights. That's a radical concept in Australia, so it is going to be an acculturation process (see all the grumpy P1s in this thread).

 

[SYD]

Interesting feedback but I was bemused that they chucked P1 on the table given they don’t award status currently (not even a comp Silver).

PC gets some lounge passes - but not Silver and the modest OW benefits that would come with.

PC+ get QP membership (yes, it’s a “tier” but anyone can buy it now and it’s not Gold that comes with the significant extra OW benefits).

Would higher spend give F lounge access but not WP?….(let alone P1).

 

[Lynda2475]

If the goal is to encourage actual frequent flyers (I.e those with status through flying) to engage more with earning on ground, rather than weaken the status privileges by giving non-flyers status privileges they would do better to offer more bonuses to those who get elite status in both parts of the program.

Like have a points challenge for status members that allow you to earn a voucher for a guaranteed upgrade or award seat realease.

For the PC+ offer bonus points if they achieve status (and if smart make it have QF metal requirements in each tier).

 

[Mr H]

It's the start of a reverse takeover process. My money is on PC eating the main QFF program in the next 5-10 years. PC becomes more and more spend for status then is merged into, and replaces, the main QFF program.

The point of these early feelers is to gauge at what level they might be able to set the spend tiers. No point setting it at a level that drives away your main base. Then you get the worst of both worlds — too high to attract new people and offensive to the main base, causing them to disengage (see Delta's recent program changes that are about to be walked back). You have to set the tiers at a level that isn't wholly offensive to the main base. You also have to start sowing the seeds that tiers are earned through spend rather than flights. That's a radical concept in Australia, so it is going to be an acculturation process (see all the grumpy P1s in this thread).

But their maths is all wrong. We know that filling a vacant J seat on a return MEL-LHR route costs QF about $1,800 based on their any seat redemption rates exposing the value of 0.6 cents per point, and the maths of 289,200 points for a J classic redemption on that route. The revenue price for that route using sale fares is $9,500 - so they make a return of $7,700. That passenger might fly several times a year. Compare that with someone who spends a whole year amassing 1,000,000 points through credit cards and that's worth $5,000.