Qantas rolls out Classic Plus Flight Rewards

[SeatBackForward]

This is credit, but without regulatory oversight. QF controls everything here all in the form of alternative currency.

If you call it actually credit or anything near that word or currency, there's going to be a lot of regulatory involvement which QF definitely does not want.

Also the carrot from the whole flying in luxury for cheap $$ cash is a big marketing engine.

Why would they - the majority of airline FF points programs work the same way. The only real difference program to program is the effective value of the points, and the allocation of reward vs revenue seats.

I think we're all arguing the same point as made above by @flyguy77 The airlines have boiled it down to just being about money. What's next? Membership subscription to QF? Pay a monthly membership/subscription fee to get access to the Classic+ fares??

 

[dairyfloss]

I think we're all arguing the same point as made above by @flyguy77 The airlines have boiled it down to just being about money. What's next? Membership subscription to QF? Pay a monthly membership/subscription fee to get access to the Classic+ fares??

QFF is already a pay-to-join membership program... but I'd hazard a guess than less than 1-2% of members have paid to join since the mid noughties, when they starting cross-promoting membership with various campaigns and partners. It's still A$99.50 for the uninitiated, though!

Cheers,
Matt.

 

[tdimdad]

Thus, the main reason is not an over-interest on the part of travellers, but the very essence of a miscalculation on the part of the airline that has been paid in advance and continued to sell seats on its planes that did not exist.

I wonder if there's been a change in how the FF customers behave and the loyalty vs yield management have been caught by that?

The programs would certainly have detailed stats and trends on how the points are redeemed. But the post-pandemic cash fares have been much higher than before, therefore perhaps the interest in CR's has spiked as people has sought to moderate their travel costs. This has taken QFF to outside of the boundaries of their earlier modellings and they are now playing catch-up.

At the same time, the big increase of Tiktoks etc peddling reward tickets adds to the long queue of aspirational point holders with no decent rewards in sight. That may be another anomaly compared to the earlier models and in direct odds with the determination to maximise the profit for the airline.

 

[elanshin]

I think we're all arguing the same point as made above by @flyguy77 The airlines have boiled it down to just being about money. What's next? Membership subscription to QF? Pay a monthly membership/subscription fee to get access to the Classic+ fares??

Look at the US, they're the "innovators" in this space. Everyone is just basically following the big 3 US airlines.

 

[Gremlin]

The airlines have boiled it down to just being about money.

As if it's never been about this?!?

Loyalty programs exist to extract an ever increasing amount of money from consumers who place an intrinsic value their brand. That is their sole purpose.

 

[trader10]

Qantas

I have 2 M QFF. Qantas is a scam, particularly to Europe. I am now Singapore. Absolute difference. Make your mind up.

 

[equus]

People have all be caught up with the aspirational marketing. The whole point from the original FF perspective was to offer up distressed inventory (seats unlikely to be sold) to loyal flyers for points.
The occasional unicorn notwithstanding, those desirable seats are now all being sold for cash. If you look, there are still lots of CR seats availalble - but not what anybody wants to use (which was the whole original premise).
Taking a completely random search - I can book SYD-TMW at 19:20 tonight and return Mon 22 at 13:30 in whY for one person. Plenty of other options available. Problem is, I don't want to fly there.
I really want 2 J seats SYD-LHR when I want them. Forget it. That was never promised.
Points can always be redeemed - ever since P+P was introduced, there was a base cash-equivalent value. What everyone is whinging about is that it is less value than the unicorn Premium redemptions - but they are increasingly a mirage.
CR+ simply widens the cash-equivalent, at a slightly better value, but still with a margin for the house.
Those trying to arbitrage buying points and getting batter value are never going to beat the house long term any more -those days are over. The only real advantage to be gained is when the incremental cost of points is nothing (other than the increased cost of everything that builds in the points cost, but if a merchant charges the same for using a CC as other methods, then may as well take advantage), and then any value redeemed is a benefit.

 

[PineappleSkip]

Then there are Facebook/Reddit groups with literally millions of members all sharing and re-sharing the content/knowledge

I am on one of those groups, supposedly QF WP members, and have found it a haven for the confidently misinformed, eager to share their misinformation. A perverse bonus for the well informed.

 

[elanshin]

Good thing I decided to check maths. Turns out right at this moment for certain CR Y flights, it's actually less than 1c per point with discounted QF Y tickets.

Was looking at Tokyo return offpeak. J reward (sprinkling around) was at about 3c per point based on cash rate. But if i had caught the NH sale that would've been about 1.5c per point for a CR.

OT, but that feeling when SYD - HND on QF is cheaper than NH,JL and JQ (with 1 stop). Only CX and PR are cheaper in Y with a stopover and only barely. I don't think I've seen QF cheaper than JQ.

 

[Clayton]

But apparently QF went bankrupt because the free seats were underpriced - revenue < cost and any business spending more than they earn they wouldn’t couldn’t “afford” to honour their part of the deal.

Personally QF often has J seats unused, so if they just adopted the LH model of releasing all unsold seats between 14 and 2 days out, I suspect there would be a lot more happy QFF members.

 

[equus]

I suspect there would be a lot more happy QFF members.

And a lot of unhappy shareholders. That is not how yield management works. The biggest earner is the premium cabins - and they keep the fares high. If everybody knew that they would release all unsold seats at the last minute, a whole lot more people wouldn't pay, and would wait - with yields plummeting.
Consider an A380 flying SYD-LHR. There are 70 business seats. Average revenue if they can fill them is probably around $6,000 or so.
Lets assume they fill 50 of them - so $300,000.
As a Classic Reward, that will set you back 144,600 points plus some fuel fines. Let's assume fuel fines of $200, and to make things easy, QF "earn" at 1c per point. That makes a CR redemption worth around $1,650 to QF. Say they release 10 seats (over the whole time). They fly out with 10 seats empty (or perhaps occupied by upgrades). Total J revenue around $316,500.
Now assume that everybody knows if the seats don't sell, then they will be release as CR. Even assuming this behaviour drops sales only 20%, and they release all the seats as CR, that changes the total to 40 seats at $6,000 for $240,000 and 30 seats at $1,650 for $49,500 - total of around $290,000.
These figures are just rough estimates, but I expect the release of all unsold seats as available for CR would have a much more drastic impact than this.

 

[tdimdad]

And a lot of unhappy shareholders. That is not how yield management works. The biggest earner is the premium cabins - and they keep the fares high. If everybody knew that they would release all unsold seats at the last minute, a whole lot more people wouldn't pay, and would wait - with yields plummeting.

Then there's the differentiating aspect from you seeing a premium product / service but not being able to access it just because. Only by paying or other means beneficial to the company you'll get access to it, if you so wish. Keeping the seats empty right in front of your nose hangs that carrot in front but just out of reach.

 

[Rnwillia]

A cynical attempt by Qantas to hose down the anger that has arisen because they have taken on millions more Frequent Flyers but not provided the appropriate additional numbers of award flights that it should be their responsibility to do to be fair to their members. Only Qantas are the Winners here asextract thousands more FF points and cash fees from members for what should be simply the continuation of the Classic Rewards scheme albeit in significantly greater numbers equivalent to the additional numbers of FF members added to the scheme. Just a RIP OFF by Qantas IMHO And only one that I will use in complete desperation!

 

[aweingar]

A cynical attempt by Qantas to hose down the anger that has arisen because they have taken on millions more Frequent Flyers but not provided the appropriate additional numbers of award flights that it should be their responsibility to do to be fair to their members. Only Qantas are the Winners here asextract thousands more FF points and cash fees from members for what should be simply the continuation of the Classic Rewards scheme albeit in significantly greater numbers equivalent to the additional numbers of FF members added to the scheme. Just a RIP OFF by Qantas IMHO And only one that I will use in complete desperation!

Agreed, it is a rip off for those who have been collecting points assuming they can use those points for CR seats.
The trouble is, if you don't use your points now in whatever way you can (CR+ included), the value of those points will continue to deflate.

 

[exceladdict]

Personally QF often has J seats unused, so if they just adopted the LH model of releasing all unsold seats between 14 and 2 days out, I suspect there would be a lot more happy QFF members.

In my experience it's been quite rare to see many empty seats lately, but I acknowledge that doesn't mean they're full of cash paying customers. Indeed any of the time I'm in J myself it's on points, and I feel like I saw a stat somewhere that points redemptions are something like 10% of seats (average across cabins)?

 

[levelnine]

One thing that could be done, but never will, is for the government to force loyalty programs to provide some transparency about their program operations.

At the moment, we have no idea how many classic award seats they released on different routes (eg to/from LHR in premium cabins), meaning they could release 0 on the most in-demand routes and still be consistent with their 5 mil claim.

We also have no idea how many points are in circulation.

A few statistics would give the average user a much better idea of whether the program is a good fit for them. It'd probably be a very sobering experience — I wouldn't be surprised if the number of points in circulation is approaching half a billion trillion.

 

[Rnwillia]

One thing that could be done, but never will, is for the government to force loyalty programs to provide some transparency about their program operations.

At the moment, we have no idea how many classic award seats they released on LHR routes in premium cabins — indeed, they could release 0 and still be consistent with their 5 mil claim.

We also have no idea how many points are in circulation.

A few statistics would give the average user a much better idea of whether the program is a good fit for them. It'd probably be a very sobering experience — I wouldn't be surprised if the number of points in circulation is approaching half a billion.

Love the idea levelnine but in reality would not expect Qantas to ever provide that sort of transparency based on history!

 

[RooFlyer]

A few statistics would give the average user a much better idea of whether the program is a good fit for them. It'd probably be a very sobering experience — I wouldn't be surprised if the number of points in circulation is approaching half a billion.

And the rest! it was reported that 1 billion points were used in the couple of days after the release of classic+

Which is why chasing Qantas points is for the most part a mugs game.

Use them if you have them but to actually chase them by spending more - often more than you have to - at Qantas merchants I think is ... well ....

Bloomberg - Are you a robot?

 

[CaptJCool]

The occasional unicorn notwithstanding, .
Those trying to arbitrage buying points and getting batter value

Well I’d like the batter “Don Bradman” please

At a batter average of 99.96 it would be the perfect Unicorn

 

[levelnine]

And the rest! it was reported that 1 billion points were used in the couple of days after the release of classic+

My mistake, I should have said half a trillion, not billion!

When you type that number out, you realise why you're never going to get a classic award seat to LHR in J: the naive keen Qantas collector's 500,000 points is fighting against 500,000,000,000 other points for that seat.