Should Qantas open more award seats to Points Club members?

[drron]

Disagree.

At last - and at least - Qantas is trying to do something about points versus status credits, and good on them.
You - or your company - may have spent a lot of money amassing your status credits, but you dismiss those who have also spent a great deal of money in other ways, which has earnt them Qantas points but no status credits.

Let's say you - or your company - has spent a hundred grand flying you around Australia or the world over the last year; why are you more important to the airline then the person who has spent a hundred grand and accumulated a hell of a lot of points? Why exactly should he or she not get as many status credits as your good self? The airline has probably earnt more from the non-flyer's activity than from yours.

Answer: you're not, even if you are unhappy about it. Put yourself in the other person's shoes.

Just one little fact that you left out.If QF doesn't sell seats then they are out of business as number of flights and available reward seats drop so then not able to sell points for as much and so on.
QFF therefore must reward frequent travellers more than frequent points accumulators.

 

[MEL_Traveller]

QFF therefore must reward frequent travellers more than frequent points accumulators.

Which they do, through status benefits such as lounge access. This is probably what ties most people to a particular program rather than the ability to redeem seats when they want, where they want (which is nover going to happen). I suspect frequent travellers are already going to see a reduction in the availability of premium awards with the downguaging of the 747 to 787. I'm not sure whther that is going to turn them away. And if that doesn't, why would Points Club?

 

[DaveB]

Feel like this discussion is irrelevant given it is over the few crumbs of int'l premium seats QF throws its members.
Flying J/F always on points, it has been a long time since I have been forced to book well ahead for a flight despite always flying the most direct route and with minimal layover. Accordingly, QF gets very little of my points spend involving over 40 bookings a year.
Member reward schemes should be commensurate with the amount of worth to the airline. Currently, QF does nothing to entice me to spend more than the current 12.3% of my points with QF. The alternatives to QF are readily available.
I know QF is interested based on the style of surveys they have sent and the six monthly enticements seeking to induce me to send points QF's way.
For many years typically booked for 4 J reward seats so QF rarely possible with SQ, DL and EK (direct) typically meeting our requirements. Using Skymiles booked four of the last six J seats available on a DL SYD-LAX July flight one week from departure. Yes, I paid far more than for a reward seat but well less than any VA/QF any seat or using Citi Rewards or Amex direct points spend.
With VA being more readily available than QF, we often booked the extra two seats directly from card reward points which inadvertently resulted in the teenage daughters reaching Platinum and Gold whilst the wife and I stayed Red. It was far from being the most efficient use of points but flying together on the most direct route will always be the deciding factor when points are readily available.
If QF is serious in attracting the business owner, even the unlikely event of being offered a jump in pecking order to say Gold or Platinum simply won't cut it. Being provided status is irrelevant when the int'l premium reward seat reward allocation is so paltry. QF would need to introduce a tiered reward seat structure comparable with other airlines or they will continue to miss out on the bulk of business generated points spend. This would preferably be either a fairly fixed system like SQ or to a lesser degree CX which we also use a lot particularly for 1 or 2 passengers. A straight demand driven system like DL would be more preferable than QF's current miserly offering.

 

[drron]

Which they do, through status benefits such as lounge access. This is probably what ties most people to a particular program rather than the ability to redeem seats when they want, where they want (which is nover going to happen). I suspect frequent travellers are already going to see a reduction in the availability of premium awards with the downguaging of the 747 to 787. I'm not sure whther that is going to turn them away. And if that doesn't, why would Points Club?

Though I was answering a post that suggested they should be equal.
But the reduction if premium awards open to Points club members would be on top of any reduction due to the 787.There probably is a tipping point.mine was reached some time ago.

 

[Pushka]

Well Pushka it is annoying being loyal to Qantas when they make $ off my spending, but I rarely find J seats for 2 out of OZ and hope they do release more to bods like me.

And people who’ve earned status have likewise paid money but this is direct to Qantas and not shared the revenue with the merchant and other providers in the points scheme if just accumulating points.

 

[MEL_Traveller]

And people who’ve earned status have likewise paid money but this is direct to Qantas and not shared the revenue with the merchant and other providers in the points scheme if just accumulating points.

True. But just the same a CC spend where you are spending on everyday items, flying still gets you from A to B, which you were intending to do anyway. So it's the same 'everyday spend' in that respect.

Your $100 flight MEL-SYD on a red e-deal might net Qantas a few dollars in profit. Possibly the same profit as $1000 worth of points they sell to a bank.

You could argue that you are spending the $100 with Qantas rather than Virgin. But the same applies to a credit card. You could be putting your spend on VA affiliated businesses rather than QF ones.

 

[drron]

It is not just profit that is important you need cashflow to pay staff,buy planes etc etc.
If you spend $100,000 a year on QF to gain status all that is cash flow for QF.
If you spend $100,000 a year on your CC likely that only 1% is cashflow for QF.

 

[MEL_Traveller]

It is not just profit that is important you need cashflow to pay staff,buy planes etc etc.
If you spend $100,000 a year on QF to gain status all that is cash flow for QF.
If you spend $100,000 a year on your CC likely that only 1% is cashflow for QF.

True. And selling points can achieve the first part too. For example back in 2009 AA sold USD1 billion in frequent flyer miles to Citi Group: BBC NEWS | Business | Airline in $1bn air mile sell-off Sales to Aussie banks probably net huge sums. Award seats mean pure profit to QF (the seat can't be sold anyway, and fuel is covered by the surcharge), other items such as toasters make profit through the sale price vs 'notional' price, which nets QF a 30% profit.

 

[RichardMEL]

Well Pushka it is annoying being loyal to Qantas when they make $ off my spending, but I rarely find J seats for 2 out of OZ and hope they do release more to bods like me.

You're not obligated to spend with QF partners, or use a QFF earning CC or whatever. You can always change to VA or SQ or something else (or even just a cash back type card, or just go debit card). Most of us would do it out of habit (ie: the local wollies is convenient and it costs me nothing more (upfront anyway) to swipe the WR card and get some nothing points so.. or it's a PITA to change banks/CCs etc so just let it go, plus to keep the account active with all those thousands of points).

Sure it's frustrating if you can't get what you want, when you want it - story of many people's lives in many different ways huh?

You mention loyalty.. well... if you've dropped to Bronze then you're not *currently* loyal are you? That's not a dig, just a statement of fact... and maybe you're slowly getting towards lifetime status (or not) but that IS the (current) level of reward for long term loyalty.

Let's put the shoe on the other foot - you've been Plat for 5 years(or whatever) and you're still trying to get those 2J awards, but you find out somehow that 2 seats you wanted were grabbed by someone with 2mill points in the PC from business CC spend(or whatever) who never flies. Then how would you feel?

it goes both ways.

 

[RichardMEL]

It is not just profit that is important you need cashflow to pay staff,buy planes etc etc.
If you spend $100,000 a year on QF to gain status all that is cash flow for QF.
If you spend $100,000 a year on your CC likely that only 1% is cashflow for QF.

Exactly the point I was trying to make some days ago -

$100k spend on partners, CCs etc is NOT the same value as $100k spend direct with QF - no, QF will not get $100k profit if you spend that direct on flights, but they will make a much bigger profit (yield) from that spend without doubt.

And, let's face it, most people will spend $$ regardless - if they earn extra from points club or not - most people would not have significant extra disposable income to spend a whole lot more on extras just for the points - and if they did, it's likely they'd do it in smarter ways (eg: buy AA/AS miles and redeem). Even CC churners these days need fair spend in Oz to generate those bonuses (eg: $4k spend in 3 months for 100k bonus type deal). Not too many "joe average" people will be doing a lot of these in a short period of time I reckon.

And again, if someone is spending 6 figures on travel related stuff - flights, hotel , cars etc it's probably quite likely they have status due to that spend- I mean an F return to LHR, for example, will get someone Gold and the yield on that? Well QF is laughing all the way to the bank on a fare like that.

Finally, I think PC will advantage those with small business expenses (eg: self owned) - funnel expenses to earn hundreds of thousands of points and bingo. How many people out there who are really interested in the FF game with a lot of $$$ to spend would not already have some sort of status or be buying premium cabin anyway?

 

[Lynda2475]

if you've dropped to Bronze then you're not *currently* loyal are you

Dropping to bronze doesn't necessarily mean you are flying with someone else, sometimes life means one cant fly as much as they would like to - illness, change in job or work travel policy. Or if you manage to snag a few classic rewards for the big personal trips, then there may not be sufficient work SYD-MEL in discount to retain status - that is certainly the case for me this FF year - I have 2 * premium Economy, and 6 * J flights which are all classic rewards and account for 6 weeks of leave - I cant fly more to get status this ff year and keep my job. I've been comfortably silver for last few years, and am gold at the moment, but i will only qualify for bronze next year (except for soft landing i will be silver im assuming).

 

[RichardMEL]

Dropping to bronze doesn't necessarily mean you are flying with someone else, sometimes life means one cant fly as much as they would like to - illness, change in job or work travel policy. Or if you manage to snag a few classic rewards for the big personal trips, then there may not be sufficient work SYD-MEL in discount to retain status - that is certainly the case for me this FF year - I have 2 * premium Economy, and 6 * J flights which are all classic rewards and account for 6 weeks of leave - I cant fly more to get status this ff year and keep my job. I've been comfortably silver for last few years, and am gold at the moment, but i will only qualify for bronze next year (except for soft landing i will be silver im assuming).

sure, absolutely. As I noted "*currently* loyal" to QF - per THEIR definition anyway. Absolutely I was grounded for 5 years and barely flew for various reasons so I get this. In the old days of MASA one could still be rewarded (SC wise) for reward seats, but those sweet days are long gone as we all know.

This thread is about opening award space to PC members with big points balances so is that really relevant? And you seem to be doing OK with 6 J reward seats, which make status moot with J Class of Service benefits pretty much accounting for most of wht status gives (certainly for domestic, mostly for int).

I was not advocating doing status runs either. These are all choices made based on each person's unique situation, goals, needs and restrictions.

I hope you enjoy your time away during your 6 weeks leave - I am sure that will be a wonderful time away

 

[Pushka]

Dropping to bronze doesn't necessarily mean you are flying with someone else, sometimes life means one cant fly as much as they would like to - illness, change in job or work travel policy. Or if you manage to snag a few classic rewards for the big personal trips, then there may not be sufficient work SYD-MEL in discount to retain status - that is certainly the case for me this FF year - I have 2 * premium Economy, and 6 * J flights which are all classic rewards and account for 6 weeks of leave - I cant fly more to get status this ff year and keep my job. I've been comfortably silver for last few years, and am gold at the moment, but i will only qualify for bronze next year (except for soft landing i will be silver im assuming).

Yes and this happened to me when I wasn’t allowed to fly. But the bottom line is that they can’t or don’t want to build a business case around such things unless you are pregnant.

 

[trippin_the_rift]

...

$100k spend on partners, CCs etc is NOT the same value as $100k spend direct with QF - no, QF will not get $100k profit if you spend that direct on flights, but they will make a much bigger profit (yield) from that spend without doubt.

And, let's face it, most people will spend $$ regardless - if they earn extra from points club or not - most people would not have significant extra disposable income to spend a whole lot more on extras just for the points - and if they did, it's likely they'd do it in smarter ways (eg: buy AA/AS miles and redeem). Even CC churners these days need fair spend in Oz to generate those bonuses (eg: $4k spend in 3 months for 100k bonus type deal). Not too many "joe average" people will be doing a lot of these in a short period of time I reckon.

....

Some really good points here.

Let's not lose sight that - if the airline were to close today - the loyalty program would be worthless - overnight.

A healthy airline can disguise an underperforming loyalty program, the same as a healthy loyalty program can disguise an underperforming airline.
The relationship between airline and loyalty program is symbiotic. One can be leveraged to help the other, but the pendulum always swings back to harmony in the future, and if the leverage was too great - airlines start failing.

I've heard some airlines are working on a third currency.
Example:

Currency #1: Points
Currency #2: Status Credits
Currency #3: Non-air earned points [eg: bank]

With the introduction of a 3rd currency, it will turn (Currency #1) points into air-earned points.
In this fashion, the value of the point being created [value to the airline] can be differentiated and can more closely reflect the margin in that point.

QFF wouldn't exist without the loyal passengers and they are the ones that should receive the majority of benefits.

100%^^^

More and more airline loyalty programs are tracking customers based on 'share of wallet'. That is - what % of your total business is the airline capturing.
If 100% of your flights is 10/year - you are by that definition: loyal

Another customer might spend $1,000,000 and take 500 Qantas flights, but they also spend another $10M with Air NZ. That customer is not loyal.

There is a basic equation to calculate loyalty value (loosely ties into LTV) that considers the share of flight/wallet%, the yield on the money spent (eg; H class tickets higher yield than I class), and the reverse impact - which is 'if a competing airline were to receive that $$ instead of our airline would we have sold that seat, and how much does it affect that customers group-wide yield LTV'.

A healthy airline needs a % of each customer segment.

 

[ozflier]

It seems Qantas has gone quiet on the proposed Points Club.
I wonder if it's just too hard !

 

[Pushka]

It seems Qantas has gone quiet on the proposed Points Club.
I wonder if it's just too hard !

I’m finding it really hard to get award flights anyway.

 

[Doctore1003]

They delayed the announcement to "early 2020"

 

[ozflier]

They delayed the announcement to "early 2020"

thank you