QF Frequent Flyer Point Redemption Sale

[oz_mark]

Perhaps I am wrong but I believe status (even lifetime) should be a reward for paid travel on the airline, or the alliance, not based on credit card spend. The term 'frequent flyer status' may no longer be relevant....

I dare say that getting SC's from an anyseat reward still requires one to fly.

 

[thewinchester]

Maybe I've zipped past this with my reduced activity on the forums in the last week. Are the SC changes applying to flights purchased solely on points - or will it also apply to flights upgraded using points?

I might well be dreaming out loud, but the idea of earning additional status credits on flights where I've shelled out points for an upgrade or in-lounge ODU, a few extra SC's would be a nice thing to have.

 

[oz_mark]

Maybe I've zipped past this with my reduced activity on the forums in the last week. Are the SC changes applying to flights purchased solely on points - or will it also apply to flights upgraded using points?

The announcement applied solely to anyseat rewards. That is, not to classic awards or upgrade awards.

 

[thewinchester]

The announcement applied solely to anyseat rewards. That is, not to classic awards or upgrade awards.

Cheers for the clarification, I knew I was off in lala land thinking that.

 

[JohnK]

I dare say that getting SC's from an anyseat reward still requires one to fly.

I guess in a way you are right.

 

[trippin_the_rift]

Perhaps anyseat flights will book into paid classes, meaning SC and points....

Technically one could obtain WP without spending a cent on flights....

 

[NM]

Perhaps anyseat flights will book into paid classes, meaning SC and points....

Technically one could obtain WP without spending a cent on flights....

but to earn enough QF FF points to redeem enough AnySeat awards to earn 1400 Status Credits to qualify (or even 1200 for re-qualify) Platinum status would means the member has spent a lot of money on something :shock:

That number of points either comes from a lot of credit card points or a lot of flights (or hotel nights, car rentals etc).

 

[equus]

the member has spent a lot of money on something :shock:

And more importantly, as a result, wherever they spent all that money, has paid QF rather a lot for those points. So QF has received cash. To actually get status after spending (someone else's cash, that QF got, but you have to have spent a whale of a lot more), you redeem via Anyseat, then actually do the flying.

Under the proposed changed model, there is no change to the principle - all Status comes from BIS flying - it is just where the "payment" originated that is being freed up, which seems reasonable, as providing the amount paid is comparable, why should QF care where it came from originally?

This approach also reinforces the change to the Rewards program (not specifically Frequent Flyer) being a separate business, as points earnt on actual revenue flights are treated equally as a cost to the flying business, and revenue to the Reward business.

 

[anat0l]

When considered on a basis of liquidity (I don't know how to better define this, my accounting skills are extremely limited to my high school Business Principles classes), would it suit Qantas more to have fares paid for in:

• Cash (i.e. credit cards, BPAY), or
• Any Seat Awards (i.e. QFF points)?

I know that QF sell points to partners, and QF also would like to keep its points debt low (after all, unlike DJ which guarantees the balances of points of all its members, QF does not have a similar arrangement, i.e. should QF become financially unstable you could easily see another AN story waiting to unfold). But surely cash payments of fares are more valuable to QF than points seats?

 

[equus]

When considered on a basis of liquidity (I don't know how to better define this, my accounting skills are extremely limited to my high school Business Principles classes), would it suit Qantas more to have fares paid for in:

• Cash (i.e. credit cards, BPAY), or
• Any Seat Awards (i.e. QFF points)?

On the basis of cash flow, consider a different proposition:



Would QF prefer to have FF points redeemed for

• Any Seat Awards (at QF determined "exchange rate"); or
• QF Classic awards (again QF determined, but better value); or
• Partner Classic awards (where QF forks out to partners)?

Sort of looking from the other direction, given the revenue stream from selling the points, QF obviously wants to promote the cheapest method of removing the associated liability. Very much the reverse of the view from the other side of fence which this forum represents - maximising value for point redemptions, with the added twist that internal redemption has no negative cash flow implications.

 

[equus]

But surely cash payments of fares are more valuable to QF than points seats?

Depends on supply and demand (like all things of value). Given the "exchange rate" for Any Seat Awards, and the price QF extracts from selling points, Any Seat Awards may actually be more profitable than cash payments.

This may especially apply to premium cabins. I would expect that a targer market exists of people generating large (business related) Credit Card expenditure, which gets the points for "free". QF charges for these, and earns the revenue. The same people may be unlikely to expend the amount equivalent to the price QF sold the points for, on the premium fare, but with excessive amounts of points, are happy to burn something which was "free" for not so great an exchange rate.

Not all the QF user forum is anywhere near as tuned in to relative values (or as concerned with maximising redemption values) as those on this forum.

In order to maintain the value of selling points, QF has to ensure that they are redeemed (for some sort of value) by the Credit Card members. If it is impossible to redeem, then the demand dries up, and the partners no longer offer QF points (and there goes the revenue stream). Ensuring the points are used is not only about keeping the book liability under control, it is about ensuring ongoing demand for more to be purchased to keep the cash flow going.

 

[dajop]

Any debate about QF credit card members just getting status by cashing in points for any seat awards is superfluous. The fact is that it happens today, but only through credit cards that don't direct sweep to Qantas.

For example, someone accruing membership rewards points on Amex can get status through spending their CC points on QF flights (exchanged at 1c per point on commercially available fares). Easy, in fact it makes Anyseat awards at the moment poor value in comparison - take a $150 fare MEL-SYD .... assuming classic award not available, available using Anyseat award using QFF points for around 15,000 pts or via AMEX MR for 15,000 points. As Amex books a commercial fare you get 1,000 pt and 10 SCs, but for anyseat you get nothing.

For QF Anyseat Awards (whose value often hovers around that 1c per point mark as well), it makes sense - indeed in the long run is important to remain competitive with the other "anyseat" rewards programs out there - to offer this as a benefit. The upside is really for those who currently accrue most of their points via flying or means other than credit cards.

 

[anat0l]

Any debate about QF credit card members just getting status by cashing in points for any seat awards is superfluous. The fact is that it happens today, but only through credit cards that don't direct sweep to Qantas.

That is actually an excellent point. This extends to premium fares - i.e. J, F - as well.

So Any Seat was pretty doomed from the start in many cases. dajop has just given more proof that offering SCs / points isn't going to help QF substantially w.r.t. Any Seat awards.

If anything, however, it does make it harder to book with some of the travel websites for credit cards if you have esoteric routings, need to mix certain carriers or need to book for travel departing from destinations apart from Australia. An alternative to say Amex TravelKey is to go to Harvey World Travel who will act like a regular agent but let you pay in MR points; however they will ask for a commission.