"Qantas relaxed about Virgin revamp"

[Mal]

Of course Qantas is bullish about their program. Do they want to publicly express "Oh, the DJ program is awesome for some flyers. We can't react quickly".

Give things a few months. We will know what QF thinks by their reactions. I presume they're already running around re-writing the benefits for WP1...

 

[markis10]

Regardless of what a minuscule percentage of the 8 million frequent fliers post on AFF about how bad this is (remember I got banned for my views before flaming me), the truth is right here....

Qantas shares closed up 2.5 cents at $1.595.

Thats ALL that matters. Loose 1,000 or even 10,000 members to VA - do we honestly think that will hurt the bottom line?

While past performance is no guarantee for future performance as they say on the markets, I note that since the VA announcement, the market has accepted their efforts more-so than QF's in terms of gain, including closing higher on a daily gain basis yesterday!

Reading the article left me with an impression of QFF management that can be only expressed in a picture, perhaps there has been quoting out of context :shock::

 

[777]

So you have insight into the details of the QF business strategy? I am a keen observer with some internal contacts and I don't know. Would be keen to hear!

I was refering to the comments in the article. Specifically the suggestion that no one would leave because they'd have to start from scratch again. It seems to ignore the existence of virgins status match offer and seems to argue that the golden hanfcuffs in and of themselves are enough to preserve their position.

That strikes me as complacent if it does actually reflect their thinking.

Sent from my GT-I9000 using AustFreqFly App

 

[Leumas]

I was refering to the comments in the article. Specifically the suggestion that no one would leave because they'd have to start from scratch again. It seems to ignore the existence of virgins status match offer and seems to argue that the golden hanfcuffs in and of themselves are enough to preserve their position.

That strikes me as complacent if it does actually reflect their thinking.

To be fair, I think he was referring to the 'big pool of points' (their words) that people will have to leave behind. He kind of has a point (pardon the pun) in that, but it's so easy earn points nowadays, it's not really a big deal. If people do move over, they'll burn down their balance anyway, so this 'golden handcuff' is easily broken.

Yes, his response may sound arrogant, but like Mal said, it's not like they're going to publicly admit they have an inferior product.

It's safe to assume benefits for P1 will be better than VP, but the qualifying bar is set so high, I'm not sure how many people will aim for P1 purely based on the yet to be advertised benefits.

 

[straitman]

First I doubt we here on AFF are typical of travellers,even regular ones.Even if every AFF WP defects I doubt it would add up to a significant percentage of their WPs.

No disagreement other than I believe DJ were reasonably smart with this in that by targeting AFF (type) people and getting it right they get the best sort of advertising ever.

i.e. Word of mouth recommendation.

 

[kpc]

I have assisted 3 non AFF people this week with the status match to Velocity. I'm sure they will be more inclined to fly Virgin now or at least give them a try as I am.

No disagreement other than I believe DJ were reasonably smart with this in that by targeting AFF (type) people and getting it right they get the best sort of advertising ever.

i.e. Word of mouth recommendation.

 

[oz_mark]

To be fair, I think he was referring to the 'big pool of points' (their words) that people will have to leave behind. He kind of has a point (pardon the pun) in that, but it's so easy earn points nowadays, it's not really a big deal. If people do move over, they'll burn down their balance anyway, so this 'golden handcuff' is easily broken.

Yes, his response may sound arrogant, but like Mal said, it's not like they're going to publicly admit they have an inferior product.

The Qantas FF strategy over the last few years has been to lock customers into the program. They have been, in many ways, successful in making customers 'stick' to the QFF scheme (witness Direct Earn cards, the Woolworths partnership, etc). By the look of what has been publicly disclosed about the profitability of QFF within the group, this strategy has been emininently successful.

Realistically, they have no need to have knee jerk reactions to this.

 

[dajop]

The Qantas FF strategy over the last few years has been to lock customers into the program. They have been, in many ways, successful in making customers 'stick' to the QFF scheme (witness Direct Earn cards, the Woolworths partnership, etc). By the look of what has been publicly disclosed about the profitability of QFF within the group, this strategy has been emininently successful.

At least until all those who 'stick' to the QFF scheme go to redeem their points ... and find out that the "free" flight they have been saving for all those years is going to cost them $900 in fuel fines

 

[Leumas]

The Qantas FF strategy over the last few years has been to lock customers into the program. They have been, in many ways, successful in making customers 'stick' to the QFF scheme (witness Direct Earn cards, the Woolworths partnership, etc). By the look of what has been publicly disclosed about the profitability of QFF within the group, this strategy has been emininently successful.

Realistically, they have no need to have knee jerk reactions to this.

You're most probably right. My point is that if you look at Virgin's offering, they also have a few direct earn cards, and most likely an increasing number of earning opportunities. Yes, they don't have as many as QF yet, but I think that will be a matter of time. The biggest difference at the moment is probably the lack of a supermarket partner with VA.

Also, to a certain degree, I think these loyalty programs rely on customer inertia, e.g. like changing banks, the process is probably a lot easier than most people think.

Definitely, there is no rush for QF. The quicker they react, the stronger they're admitting there is a problem.

 

[UP4014]

Regardless of what a minuscule percentage of the 8 million frequent fliers post on AFF about how bad this is (remember I got banned for my views before flaming me), the truth is right here....

Qantas shares closed up 2.5 cents at $1.595.

Thats ALL that matters. Loose 1,000 or even 10,000 members to VA - do we honestly think that will hurt the bottom line?

Moaners and whingers (im in cat 1) get over it, if you want to abandon ship, go for your life but do it quietly please, im getting a QF/VA headache...

munitalP

You can actually make more money by sometimes having less passengers. I'd guess that QF is gambling the bottom end of their FFers head over to Virgin attracted by the bling and they retain high end.

Matt

 

[gumpy]

Ah... so i was quite niave to think QF would do something to respond... =(

 

[connieguy]

You can actually make more money by sometimes having less passengers. I'd guess that QF is gambling the bottom end of their FFers head over to Virgin attracted by the bling and they retain high end.

Matt

If they think that they are totally ignoring the VA torpedoes in the water and streaming at high speed toward their under sides. When you start ignoring any sector of your customer base, it is hard to differentiate and not to also ignore the middle and top sections of your customer base. I thought AJ said that Platinums were QF's most valued customers?

QF/AJ would be very foolish to ignore what is happening and why their WPs are taking up the VA status match and moving some of their spend away from QF and to VA. What was it VA said some time back? They wanted to grab 20% of QF's customer base spend? I suggest they will achieve that goal. I also suggest VA have a few more shots to fire into the QF under belly that QF think is not attackable.

 

[drewbles]

In a sense, he's not completely wrong. We dish out great advice about our FF habits that even normal people without excessive FF'ing can achieve. Like Business class return airfares to Europe for less than $2,000 apiece. Why don't normal people do it? It's not because they are stupid (well, not all of them anyway).

It's laziness. It's corporate policies that are too lazy to change (even if it'll save a bunch of dollars). It's the risk of the unknown (how many of us at work have come across that bit of resistance to our work proposals...).

With all due respect, it's been stated on several posts in the VA thread that there have been several dozen CL's wander in to status match with VA (in the lounges) as well as several other effectively "QF Sponsored" celebs (George Calombaris) have been spotted in the DJ Lounges after a match.

Methinks QF is coughy, thinking the new "upstart" is no threat to them.

I think otherwise. DJ will go after the corporate market. They will use Platinum as a carrot to the management of said corporates to move spend to DJ. They will bestow things on management that QF don't think they need.

DJ are a real threat to QF, QF are just too coughy to admit it (and Anytime Access is a big thing; it was one of the only real differentiators for WP over SG for Domestic travel; used or not, it was a benefit that was removed under the guise of de-crowding, only to have QP membership sales within 48 hours of the end of the benefit; it wreaks of arrogance).

 

[QF WP]

Was just chattting to Dave Noble and he had Channel 9 on in the background. A news story about Qantas came on and he told me that the story outlined that QF are refitting some 747's, taking First out and and refitting with fully flat beds in J.

 

[munitalP]

Was just chattting to Dave Noble and he had Channel 9 on in the background. A news story about Qantas came on and he told me that the story outlined that QF are refitting some 747's, taking First out and and refitting with fully flat beds in J.

heres a link

Twitter my comment to @qantas was "reminds me of a wolfmother song, thief and the leprechaun in the night... LOL"


:shock:

 

[serfty]

Was just chattting to Dave Noble and he had Channel 9 on in the background. A news story about Qantas came on and he told me that the story outlined that QF are refitting some 747's, taking First out and and refitting with fully flat beds in J.

... erm ...

Lindsay, where have you been? That was announced last year.

by 2014/2015 there should not be any QF 744's plying the airwaves with First Class seating.

They are getting skybed Mk II, the same as in the 388's. Many are being retired.

 

[VHOEJ]

I am sure QF are not that arrogant. They aren't exactly going to say " yeah they have come up with something really good, we are going to struggle to compete". They would be analysing the DJ changes with a fine tooth comb and trying to come up with something to respond, which wont happen overnight.

 

[simongr]

In terms o feeing locked into QF I actually think that isn't as true as people think. I am a fairly frequent flyer at May last year I had no FF points (I count anything below 25K as 0) and no Amex points. Somehow now I have 190K Amex (transferrable to multiple airlines) 220K QF (I have no idea how that happened) which is a good stack to do some stuff with.

However I now have access to VA Plat and I could switch to VA completely including upcoming trips to JED (2 of which on Ethiad would be more comfortable than CX who I love but have regional seats for 10+ hours of flying) and switch my DOM flights to VA (I have a VA planned in two weeks to test the water). The 200K in QFF is enough for some good international awards either coupled with the Amex points or on their own.

I essentially have through Amex 200K of velocity points to play with (subject to not using them through QF).

So the question is - where are the hand cuffs?

I will miss the SYD F lounge ... a lot BUT if i can get VA working well then QF is dead to me.

I will rewrite this in better english and send it to various email addresses in QF that I have (including Alan Joyce) as I think that QF need a wake up call. Lifetime status is not a lock in as I don't trust QF management to keep that benefit.

Today has been a significant day of reflection on this topic.

 

[niemann]

In terms of feeing locked into QF I actually think that isn't as true as people think.

I think you're right, airlines might over-estimate loyalty. There are number of subgroups in the loyalty system though:

- High points, low status credits eg. people who get most of their points through shopping = not an interesting group to any airline. The airline bit is peripheral to them as they just use it to burn points.
- Low points, low status credits = less likely to shift from where they are as they are keen to get at least some status with somebody.
- High points, high status credits = if they're not top tier, likely to stay loyal to get there.
- High points, ultra-high status credits = no cost to be participate in two programs. For these people, they'll fly whoever meets their flying (not points) needs best, and would happily switch programmes if the product on one airline was better than the other. Qantas has this market sewn up given the frequency and 'bigness' ie. ability to mitigate a disruption through having extra aircraft. That's what drives the loyalty, not the FFP as they have so many damn points they don't even know how to spend them!

 

[dajop]

- High points, high status credits = if they're not top tier, likely to stay loyal to get there.

Unless of course you remove some benefits from the top tier, and a few months later add some benefits to the second top tier such that those in this group question if the benefit of being top tier (compared the second top tier) is really worth it after all.