Qantas FF announcement 20 June - "biggest overhaul" in program history

[Mrmaxwell]

From Olivia herself;

"To reward our highest flyers, we will soon be launching Lifetime Platinum. Eligible members will enjoy the benefits of Platinum status, regardless of how often they fly"

Regardless how often they fly...after the initial 62yrs of Platinum

 

[JohnK]

@TigerBob, I think you made a typo, the SC requirements for Lifetime Gold is 14,000 SC's - see: Frequent Flyer - Flying Qantas and Partner Airlines - Status Credits and Tier Benefits - Status Credits.

At 17K SC's you are only 20% more than LTG. It was always likely to be a linear increase (28K) or higher. They chose much higher than most of us expected.

It would be very hopeful to expect Lifetime Platinum at only 28,000 SCs as that would almost include me in 5 years time and I would have only flown seriously for less than 20 years.

I think you'll find the most likely number of SCs would have been 42,000 SCs or 56,000 SCs but Qantas chose a much higher number. They're are obviously only targetting high value long term flyers.

You need to keep in mind there are people that are earning 5,000 SCs - 7,000 SCs a year and you wouldn't want to give someone Lifetime Platinum after only 4-5 years.

 

[NM]

Regarding Lifetime Platinum at 75,000 SCs, I hit Lifetiume Gold with 14,000 SCs in early 2006. In the 12 years since achieving that milestone, my lifetime SC count has progressed to teh lofty heights of 14,270 SCs. At this rate it will take me 1355 years to reach Lifetime Platinum, assuming I can get double status credits for the entire time.

Perhaps they were going to set the bar at 37,500 SCs but realised that everyone gets the double status credit promotion these days so 75K is the new 37.5K.

 

[oz_mark]

Please help me out here....

Previously LTG had lounge access.
Now you dont???

Lifetime Gold has all the benefits of Gold. The table you refer to only gives examples of what you get, it is not exhaustive. The text for Lifetime Gold has not changed in a long time on that page.

 

[JohnK]

Qantas is now the most expensive program in Oneworld for long haul premium redemptions in award buckets.
And now, the most expensive to earn lifetime Emerald.

There are far more advantageous options out there. But you can only lead someone to the water.... can't make you drink it.

And how many frequent flyers would seriously target Lifetime Platinum? 0.000001%? Or less?

 

[dajop]

Is it Lifetime Platinum, or should it be a Lifetime of Platinum?

 

[Ade]

Just a question - did QF address one of our most popular subjects “Fixing the Priority Boarding line.” .

I don't think QF ever will

 

[opusman]

I think you'll find the most likely number of SCs would have been 42,000 SCs or 56,000 SCs but Qantas chose a much higher number.

Logically it should have been 36k.

10 years of SG = LTS (7000)
10 years of WP = LTG (14000)
10 years of WP1 = LTP (36000)

 

[Max Samuels]

If paying that much, it’s 99.99999% certain that classic awards would not be available! So one cannot equate value of classic award to be the same as that particular cash value.

Not necessarily.... if you believe the airline that there are a certain number of redemption fare classes on every flight (that's what they claim), then in theory it is possible for someone who booked a redemption seat 12 months ago to cancel it or change it at the last minute, whereby it should become available the same as inventory....

 

[Max Samuels]

While yesterday was all about points and status, there would be no points business without them first having an airline. So regardless of the difference in margins between fares and selling points, and the huge market for points with non-flyers, underneath it all is an airline that needs to have people happy to fly with them.

Exactly.
This whole business about loyalty being the most profitable arm of the business is total BS.
Its clever accounting where they have completely detached the loyalty business from the cost centre of the airline, so it looks good on paper so it can be potentially sold off... yet it cannot exist without the airline component, so to not share any of the costs with the airline is just stupid and dishonest.... hence why it hasn't been sold, I imagine....

Who on earth would buy a "loyalty" business and have no control over the company to which the loyalty is attached?

 

[Max Samuels]

Oh some people may well know it. But you have a family of 6 to cater for, all kids at school, one needing an ipad. What utility is a SYD-LAX return in J for this person vs ipad? Using the points for an ipad is going to save them $1k, whereas a single return to LAX in J probably is worthless to them (and it's a stretch to say that's worth $16k or more, you can get such fares these days for closer to $5k, if not on QF then definitely on someone else, and probably easier to find than an award flight as well.).

Hmmmm... not quite buying it. Someone that flies enough or spends enough to rack up a million FF points/year hardly sounds like the type that hasn't already bought an ipad for little Crispin or Brooklyn...

 

[jonboixxx]

Exactly.
This whole business about loyalty being the most profitable arm of the business is total BS.
Its clever accounting where they have completely detached the loyalty business from the cost centre of the airline, so it looks good on paper so it can be potentially sold off... yet it cannot exist without the airline component, so to not share any of the costs with the airline is just stupid and dishonest.... hence why it hasn't been sold, I imagine....

Who on earth would buy a "loyalty" business and have no control over the company to which the loyalty is attached?

Someone like Affinity Equity Partners. There's gold in them thar hills!

 

[andye]

My partner has now received the email from Olivier. I note that I have not, despite our FF numbers having a difference of exactly 1 and mine is numerically first. But I guess that is neither here nor there as I had already read what the changes to the program are.

Very interesting to note in the email that the 1M increase to award seat availability brings the total number of seats to 5M.

What I don’t understand is Qantas published in FY18, that 5.2M awards were redeemed. Qantas Data Book 2018

Surely 5.2M+1M = 6.2M seats available. But somehow we are being fed 5.2M+1M = 5M. It appears that not only aren’t we, as Frequent Flyers, getting 1M more seats availability, we are actually losing 200,000 seats that were previously available in FY18. But because most people wouldn’t have the faintest idea how many seats were available to begin with and that 1M sounds like a lot, we all think losing 1.2M award seats is a good thing. The power of PR is amazing.

I suspect this is not relevant but I suppose an upgrade award could result in no net change in available seats

Exactly.
This whole business about loyalty being the most profitable arm of the business is total BS.
Its clever accounting where they have completely detached the loyalty business from the cost centre of the airline, so it looks good on paper so it can be potentially sold off... yet it cannot exist without the airline component, so to not share any of the costs with the airline is just stupid and dishonest.... hence why it hasn't been sold, I imagine....

Who on earth would buy a "loyalty" business and have no control over the company to which the loyalty is attached?

I understand Air Canada sold theirs with predictable results

 

[rock86]

<snip>
Its clever accounting where they have completely detached the loyalty business from the cost centre of the airline, so it looks good on paper so it can be potentially sold off...
<snip>

Except that it's not clever accounting on QF's behalf for a potential 'sell off', rather a requirement under Accounting Standards.

 

[Mrmaxwell]

You need to keep in mind there are people that are earning 5,000 SCs - 7,000 SCs a year and you wouldn't want to give someone Lifetime Platinum after only 4-5 years.

Why not?

Earning 5000-7000SCs per year means at least 20+ long haul International sectors in premium cabins with an annual spend of $50-$100k.

You think LTP is valued at more than half a million bucks?

As others already mentioned it is simply a token gesture when in reality QF know how many (rather how little) will reach or have already reached this lofty milestone.

 

[Max Samuels]

All jokes aside, I imagine this points club thing is a pre-emptive move by the airline, anticipating some future backlash from the ACCC (or even APRA).

A couple of years ago I was working as an analyst for a major bank in the credit card loyalty section of the business. And this very thing constantly came up in discussion with the legal team. When Qantas started charging money for points, the points become a product, and therefore subject to the same warranty rules etc that any other product has under the various consumer laws. If you are selling points that can never be redeemed, or cannot be redeemed in a “reasonable” fashion, you run the risk of falling afoul of the law. What is reasonable? Well that is the million dollar question. But certainly the nearly 2M points needed for an any seat reward to LAX in First Class is probably not considered reasonable…. This is a somewhat grey area (similar to gift cards that expire), and is ripe for picking by a class action law suit if they are not careful.

When Qantas initially offered points as a reward to its passengers, it was under no obligation to make sure those points could be used; no money changed hands, and the points were merely a gift from the airline. As stated above, however, once they started charging for them, the whole landscape changed. Furthermore, if it could ever be argued successfully that Qantas has sold more points than can actually ever be redeemed, it is potentially in big trouble.

This is why it has always confused me as to why they make it so bloody hard to redeem points! Look to the US, for example. The airlines there faced a similar problem with potentially more miles floating around than there were seats for the next century, so AA, for example, will NEVER fly with empty seats in F/J if there are people willing to redeem miles for an upgrade. Every unspent mile on your ledger is a potential liability.

I think this move by Qantas is the first step in the direction of seriously reducing their exposure to millions and millions of dollars of defective “products”, in the form of unusable points…..

 

[Max Samuels]

I understand Air Canada sold theirs with predictable results

https://www.cbc.ca/news/business/air-canada-aeroplan-rewards-program-loyalty-1.4793389

OMG I Love it!!!

They sold off the loyalty program in 2008, and now have started a new RIVAL program!! Lol
And the newly created rival program is going to buy back the one that they sold off!
Yes Qantas - do something like this!

 

[rock86]

All jokes aside, I imagine this points club thing is a pre-emptive move by the airline, anticipating some future backlash from the ACCC (or even APRA).

A couple of years ago I was working as an analyst for a major bank in the credit card loyalty section of the business. And this very thing constantly came up in discussion with the legal team. When Qantas started charging money for points, the points become a product, and therefore subject to the same warranty rules etc that any other product has under the various consumer laws. If you are selling points that can never be redeemed, or cannot be redeemed in a “reasonable” fashion, you run the risk of falling afoul of the law. What is reasonable? Well that is the million dollar question. But certainly the nearly 2M points needed for an any seat reward to LAX in First Class is probably not considered reasonable…. This is a somewhat grey area (similar to gift cards that expire), and is ripe for picking by a class action law suit if they are not careful.

When Qantas initially offered points as a reward to its passengers, it was under no obligation to make sure those points could be used; no money changed hands, and the points were merely a gift from the airline. As stated above, however, once they started charging for them, the whole landscape changed. Furthermore, if it could ever be argued successfully that Qantas has sold more points than can actually ever be redeemed, it is potentially in big trouble.

This is why it has always confused me as to why they make it so bloody hard to redeem points! Look to the US, for example. The airlines there faced a similar problem with potentially more miles floating around than there were seats for the next century, so AA, for example, will NEVER fly with empty seats in F/J if there are people willing to redeem miles for an upgrade. Every unspent mile on your ledger is a potential liability.

I think this move by Qantas is the first step in the direction of seriously reducing their exposure to millions and millions of dollars of defective “products”, in the form of unusable points…..

The liability could be mitigated to a degree with a fixed expiry period of points after they're earnt, aka Krisflyer. The 'breakage rate' would likely increase significantly as well, pushing up their paper profits further for that reporting period.

So it is interesting (purely from a financial perspective) they have yet to move in this direction - I'd hazard a guess though that there would be significant backlash if they did implement a fixed expiry.

 

[QF WP]

I'd be up for reading that!!

As an aside, for some time, I've been mainly focused on points earning that focused on KF (and also VA), with a back-up pool of QF points for rainy days, and had to focus that strategy quite tightly since mid-April AMEX deval (since the Plat card became much less relevant without Explorer link). My 1st reaction to high-level reading of QF changes today was whether I was making a mistake with my revised approach, but then I was like 'nah, it's QF!, stick to the plan!'.

Btw, someone else asked this, but is this a record for number of posts in the time since this thread was posted?!

Not even close yet - the last enhancements had more angst for us: Qantas FF announcement 20 June - "biggest overhaul" in program history

 

[dajop]

Hmmmm... not quite buying it. Someone that flies enough or spends enough to rack up a million FF points/year hardly sounds like the type that hasn't already bought an ipad for little Crispin or Brooklyn...

You mentioned 170,000 points for the ipad, not million/year. Over a few years for a family, that is probably not unrealistic at all, especially with a credit card bonus thrown in there. My point is, there are an awful lot of people out there who have priorities other than business class travel to the other side of the world.