Losing QFF points and calling in the media

[Pleb Status]

I am surprised that there are still people who do not have a Woolworths rewards card attached to QF.

I am thinking of swapping my limited WWR earn back to cash as I do not think the QFF points are worth the effective 1.15c/pt charge...

 

[Himeno]

I am surprised that there are still people who do not have a Woolworths rewards card attached to QF.

The Woolworths Rewards program is not active in Tasmania, so there are QFF members based in Australia who would not be linked to a program that doesn't exist where they live.
Even in the rest of Australia, there are Woolworths customers who adamantly refuse to even get a card to start with.

 

[Pushka]

I am surprised that there are still people who do not have a Woolworths rewards card attached to QF.

Ive found that card useless. I’m surprised anyone still has it.

 

[get me outta here]

The people in the article could have used the WOW Rewards card in their location to keep their QF points alive.

Ive found that card useless. I’m surprised anyone still has it.

 

[serfty]

Ive found that card useless. I’m surprised anyone still has it.

I guess it is location dependant, last year with 4 linked memberships and judicious use of bonus point offers we earned over 26000 QFF points, saved $120 in fuel and had direct savings of $110 in December.

That was with splitting basic weekly shopping between Woolworths and Coles (FlyBuys [>$400 saved up there as well]).

 

[Pushka]

The people in the article could have used the WOW Rewards card in their location to keep their QF points alive.

But I’ve found the points aren’t accumulating for me to transfer them over.

 

[serfty]

But I’ve found the points aren’t accumulating for me to transfer them over.

For every $2000 accumulated spend at Woolworths, BWS, Big W, Woolworths Caltex, etc. you can earn 870 QFF points.

This is getting off topic, for more on earn see here: Woolworths Rewards

 

[Le Clair]

Why should points that you've earned in good faith expire in the first place? The whole point of QFF is to inspire and promote loyalty...

Because Qantas is a business which has to make a profit. Qantas Points are treated somewhere as a contingent liability. If the liability is not limited by issuing points which never expire, at some point, no matter how successful the business, it would enter technical insolvency, its share price would crash and the business would fail. It would be interesting to know how many Qantas Points expire every year compared to how many are issued and what percentage of memberships are dormant.

 

[MEL_Traveller]

Because Qantas is a business which has to make a profit. Qantas Points are treated somewhere as a contingent liability. If the liability is not limited by issuing points which never expire, at some point, no matter how successful the business, it would enter technical insolvency, its share price would crash and the business would fail. It would be interesting to know how many Qantas Points expire every year compared to how many are issued and what percentage of memberships are dormant.

I don't understand this. Qantas sells points. The money it makes from those points could go in to a holding bank account. I don't see how there's any potential loss to qantas, except for the cost of inflation... but that can be remedied by increasing the cost of awards like toasters or other similar items. Awards and rewards aren't guaranteed and award seats are limited. It's not like QF would need to make seats available to everyone if they all decided to redeem them in a single year (and hence not get any regular revenue). If they have 10 billion outstanding points they still only have 'x' number of seats that can be redeemed. If those 10 billion points are used for toasters, the money should be set aside anyway (and QF makes a hefty profit on those).

In any event is the liability limited now? If every single FFer set up some way of earning just a single point each year the points never expire anyway. Does that also lead to technical insolvency?

If QF had a rolling three year expiry, similar to SQ, that would perhaps solve the issue.

 

[Himeno]

I don't understand this. Qantas sells points. The money it makes from those points could go in to a holding bank account.

The sell, buy and use price/'value' is different depending on what it is used for.
QF could get $10 per 1000 points from one source, and $5 per 1000 from other.
The value of points used to buy toasters is different to the value used to buy a flight.

 

[amaroo]

But I’ve found the points aren’t accumulating for me to transfer them over.

It helps if you've got a couple of teenagers to feed + a truckload of their friends. Last quarter we accumulated 20,584 QF points. This quarter will be lower as we've spent the first 5 weeks out of the country enjoying those points

 

[MEL_Traveller]

The sell, buy and use price/'value' is different depending on what it is used for.
QF could get $10 per 1000 points from one source, and $5 per 1000 from other.
The value of points used to buy toasters is different to the value used to buy a flight.

There was some discussion in another thread about the 'value' of points. QF puts a notional value of $0.007 per point. This is reflected for anyseat awards and the like (with tiny variances). They sell those points, allegedly, for about 1c each to banks and other suppliers. So they make an almost 50% profit per point sold.

For toasters and other things QF determines the selling price for those products. A toaster which might be $50 they sell for $60 (or more) in their store. Even on 'sale' they were flogging a set of pans as few weeks ago for $179 which were available at DJs for just $119. But QF charges FFFers the $179 price, at the notional value of 0.007 per point. So I thought it was that the points always have the same notional value, but the difference is in the QF mark-up. Airfares are more transparent because you can actually see what the real cost is (not some inflated QF store cost).

 

[Pushka]

It helps if you've got a couple of teenagers to feed + a truckload of their friends. Last quarter we accumulated 20,584 QF points. This quarter will be lower as we've spent the first 5 weeks out of the country enjoying those points

Yeah. A good incentive to keep the kids at home longer. Or not!

 

[serfty]

The other thing factored in by QFF accountants is expected "Breakage"; this goes to the core of the issue raised this thread.

Unredeemed points including those expired increase profit.

Simples!

 

[get me outta here]

Once we’ve done this one to death, we could have a look at all the ways to earn QF points apart from flying. There is cc sign ons; WOW Rewards card set to QF; ....

 

[rock86]

Because Qantas is a business which has to make a profit. Qantas Points are treated somewhere as a contingent liability. If the liability is not limited by issuing points which never expire, at some point, no matter how successful the business, it would enter technical insolvency, its share price would crash and the business would fail.

Well that isn't technically correct. The reason being is that loyalty schemes are classed as deferred revenue, because ultimately any 'loyalty redemption cost' is built into the price you charge for your items. So xx% of each sale goes straight to revenue, the other xx% goes to the balance sheet under liabilities as 'Deferred revenue'. Only when something is redeemed do you realise that revenue, or when you believe a loyalty redemption is no longer likely - breakage revenue as serfty points out below. For you to realise breakage revenue you will need to have valid assumptions and calculations which are reasonable and this will be tested & signed off by your auditors.

There was some discussion in another thread about the 'value' of points. QF puts a notional value of $0.007 per point. This is reflected for anyseat awards and the like (with tiny variances). They sell those points, allegedly, for about 1c each to banks and other suppliers. So they make an almost 50% profit per point sold.

For toasters and other things QF determines the selling price for those products. A toaster which might be $50 they sell for $60 (or more) in their store. Even on 'sale' they were flogging a set of pans as few weeks ago for $179 which were available at DJs for just $119. But QF charges FFFers the $179 price, at the notional value of 0.007 per point. So I thought it was that the points always have the same notional value, but the difference is in the QF mark-up. Airfares are more transparent because you can actually see what the real cost is (not some inflated QF store cost).

Exactly, every QFF point has a margin built in - so no redemption of points should ever be making a loss for QF. One way they would come unstuck is if they are overstating breakage revenue, so efffectively writing back more deferred revenue then they should be. If they wrote back too much deferred revenue to the P&L (subsequently reducing the liability on the balance sheet), then they could come unstuck if some of those redemptions were claimed which had already been written off - but this would have to be significant.

The other thing factored in by QFF accountants is expected "Breakage"; this goes to the core of the issue raised this thread.

Unredeemed points including those expired increase profit.

Simples!

Definitely simple

 

[rock86]

Once we’ve done this one to death, we could have a look at all the ways to earn QF points apart from flying. There is cc sign ons; WOW Rewards card set to QF; ....

There's plenty of ways, and while I feel sorry for the position they were in, QF provided them with a reasonable point challenge to regain their expired points (which is outside the T&C's of their program).

A quick google search would have provided them with countless ways to obtain the point challenge required for their QFF point balance reinstatement.

 

[cove]

I still have not had anyone in front nor behind me pay with a 5 % off Woolies gift card at their supermarket. Some don't even have a Woolies rewards card.
There are heaps of people who are battling to keep up with emails, phone calls and opportunities to earn points.

 

[lovetravellingoz]

I still have not had anyone in front nor behind me pay with a 5 % off Woolies gift card at their supermarket. Some don't even have a Woolies rewards card.
There are heaps of people who are battling to keep up with emails, phone calls and opportunities to earn points.

There are a heap more that either:

1/ Fail to recognise opportunities
or 2/ See the opportunity, but fail to act anyway. (Carpe Diem)

 

[cove]

Buying Fuel
Ok I get the RAC sourced 5% gift cards plastic ones in the mail using Amex Platinum Edge (3 points per dollar). Go to my local Caltex on the way to the pool using the gift card and the 4 cents off from the Woolies Rewards card on the cheap Sunday deal in Perth. Buy 98 octane fuel which was $1.48 today. I have over 11 cents off plus the Miles/Points that have a retail value of about 12 cents. Now Shell over the other side of the road is usually at least 7 cents more....

Thanks LTO for the Platinum Edge tip. I think I have bought about $30,000 of Woolies Gift Cards since you mentioned it.

Back on topic:
For the average Australian they really are battling with the idea that Qantas points expire with 18 months of inactivity. Too bad...too sad.
Other than Woolies we use Booktopia and Epicure in our family group plus credit cards and an occasional air ticket.
With 10 million odd Qantas accounts many will fail to comprehend the breakage rules.