"... we'll shortly announce a major investment to improve our Frequent Flyer program"

[levelnine]

I look next to it which I assume is CR J....

Yes, the right hand column is a classic award in J.

 

[RooFlyer]

so very possible the website changes are not going quite to plan.

I'm shocked - shocked I tell you.

 

[levelnine]

Thinking a little more about this move by Qantas, I'd suggest that it ironically ensures classic award seats are not going away anytime soon.

If Qantas had chosen the Singapore model of having saver and advantage awards, we would rightly expect more and more flights to appear predominantly at the higher advantage tier over time.

But this move practically forces Qantas to keep classic awards at roughly current levels because, if they migrate most seats to Rewards+, there will be no reason to collect Qantas points anymore via many channels.

Take Woolworths rewards as a simple example. If Qantas points come to have, for all practical purposes, a fixed 1c/pt value, there's no point converting them from Woolworths — it is the same value. Might as well get $10 off your Woolworth shop rather than $10 off your Qantas flight.

Take regular credit card spend as another example. If Qantas points come to have, for all practical purposes, a fixed 1c/pt value, there's no point spending on a Qantas card where there's a credit card surcharge — the surcharge will typically eclipse the value of the points attained.

I'm sure it's the same for a lot of other promos where you're effectively buying Qantas points at or near 1c/pt. If all you can ever do is redeem them for 1c/pt, you might as well forego the points and save your cash — cash has more optionality than Qantas points.

That would kill the program. The only way not to kill the program is to at least hold out some hope of getting more than 1c/pt in value.

 

[exceladdict]

Thinking a little more about this move by Qantas, I'd suggest that it ironically ensures classic award seats are not going away anytime soon.

If Qantas had chosen the Singapore model of having saver and advantage awards, we would rightly expect more and more flights to appear predominantly at the higher advantage tier over time.

But this move practically forces Qantas to keep classic awards at roughly current levels because, if they migrate most seats to Rewards+, there will be no reason to collect Qantas points anymore via many channels.

Take Woolworths rewards as a simple example. If Qantas points come to have, for all practical purposes, a fixed 1c/pt value, there's no point converting them from Woolworths — it is the same value. Might as well get $10 off your Woolworth shop rather than $10 off your Qantas flight.

Take regular credit card spend as another example. If Qantas points come to have, for all practical purposes, a fixed 1c/pt value, there's no point spending on a Qantas card where there's a credit card surcharge — the surcharge will typically eclipse the value of the points attained.

I'm sure it's the same for a lot of other promos where you're effectively buying Qantas points at or near 1c/pt. If all you can ever do is redeem them for 1c/pt, you might as well forego the points and save your cash — cash has more optionality than Qantas points.

That would kill the program. The only way not to kill the program is to at least hold out some hope of getting more than 1c/pt in value.

Do you think enough punters know this though?

Do people in the US still go out of their way to earn Delta miles, instead of going for cashback cards?

Do people in NZ bother earning airpoints?

 

[levelnine]

Do you think enough punters know this though?

Do people in the US still go out of their way to earn Delta miles, instead of going for cashback cards?

Do people in NZ bother earning airpoints?

It's an excellent question. My guess is that if Qantas reduced points to a fixed value of 1c/pt it would become general knowledge and people would generally come to understand that it is not worth earning them if they cost you more than that amount.

There are plenty of dud loyalty programs out there that no one bothers with because they don't offer enough value to be worth the effort.

I can't speak to NZ Airpoints (I'd guess they don't have to be competitive because they have no real competition), but for Delta (1) the fixed value of their miles is 1.85c/pt AUD (1.2c/pt USD) — ie almost double what Qantas is proposing with Rewards+ (2) most American businesses do not impose credit card surcharges so the miles are still 'free' unlike in Australia and (3) many Delta credit cards earn 2x miles for every dollar spent at restaurants/groceries/etc, which definitely makes them still worth earning. If only we could earn Qantas points on card spend at a rate of 3.7 points per dollar!

 

[Mr H]

Thinking a little more about this move by Qantas, I'd suggest that it ironically ensures classic award seats are not going away anytime soon.

If Qantas had chosen the Singapore model of having saver and advantage awards, we would rightly expect more and more flights to appear predominantly at the higher advantage tier over time.

But this move practically forces Qantas to keep classic awards at roughly current levels because, if they migrate most seats to Rewards+, there will be no reason to collect Qantas points anymore via many channels.

Take Woolworths rewards as a simple example. If Qantas points come to have, for all practical purposes, a fixed 1c/pt value, there's no point converting them from Woolworths — it is the same value. Might as well get $10 off your Woolworth shop rather than $10 off your Qantas flight.

Take regular credit card spend as another example. If Qantas points come to have, for all practical purposes, a fixed 1c/pt value, there's no point spending on a Qantas card where there's a credit card surcharge — the surcharge will typically eclipse the value of the points attained.

I'm sure it's the same for a lot of other promos where you're effectively buying Qantas points at or near 1c/pt. If all you can ever do is redeem them for 1c/pt, you might as well forego the points and save your cash — cash has more optionality than Qantas points.

That would kill the program. The only way not to kill the program is to at least hold out some hope of getting more than 1c/pt in value.

It's an excellent question. My guess is that if Qantas reduced points to a fixed value of 1c/pt it would become general knowledge and people would generally come to understand that it is not worth earning them if they cost you more than that amount.

There are plenty of dud loyalty programs out there that no one bothers with because they don't offer enough value to be worth the effort.

I can't speak to NZ Airpoints (I'd guess they don't have to be competitive because they have no real competition), but for Delta (1) the fixed value of their miles is 1.85c/pt AUD (1.2c/pt USD) — ie almost double what Qantas is proposing with Rewards+ (2) most American businesses do not impose credit card surcharges so the miles are still 'free' unlike in Australia and (3) many Delta credit cards earn 2x miles for every dollar spent at restaurants/groceries/etc, which definitely makes them still worth earning. If only we could earn Qantas points on card spend at a rate of 3.7 points per dollar!

I am really struggling to follow the logic here.

Apart from the arguable case of supermarket points, most of us don't make a direct transaction to buy the points for 1 cent. They are bought by a bank, shop, insurer or whatever and given to us as an incentive. The consumer will treat them as free and won't object too much to redeeming them to get 'free' flights or money off flights. This means in most situations where people earn points, they do not have an option to take cash instead - so they will continue to take points rather than not take points.

The bit about credit card earn is a red herring. For most of us, the amount of points we get through credit card earn is fairly insignificant. The big points come from sign up bonuses. My daily credit card (ANZ Travel Adventures) gives me almost no points but does offer free free overseas transactions. That covers the annual fee and I don't care about the foregone earn points.

While we are at it, what happens in other markets is irrelevant - people cannot easily change the market in which they operate. Australian credit cards compete with other Australian credit cards. I think in any case that Australian consumers have better sign up bonuses than pretty much every other country so what we might lose on transaction fees and spend-points is outweighed by what we can get by churning.

Finally, I don't understand why you think this new scheme guarantees that the supply of Classic Rewards will remain unchanged. Nobody knows how many or how few seats are actually released - we just take QF's word for it when they say they have released an extra xx_ seats or doubled the availability. Most of us never see the premium seats as they get snapped up by WPs before they are visible to the rest of us. And what really matters in any case is not the availability on QF metalbut overall OW availability. Given that the new scheme allows QF to say they have massively increased supply of reward seats, I can see no reason why they would want or need to keep the supply of CRs at current levels.

 

[CaptJCool]

My gripe is this

Killin’ the golden goose

My local coffee shop
Sells coffee for around $5.50
9 coffees spend $49.50 and the 10th is free (so 10 coffees come In at $4.95)
That’s a 10% savings. Simple

Because airfare.s are not Fixed price (well classic rewards CRS not withstanding)

What’s the discount YOU receive?

Given CRs often exhaust early like Red-E deals, they REPRESENT better value when the Y fares are “off the bottom”

Not everyone is able to book a year ahead. Often events, family visits only get booked weeks ahead not months

As a guide 2 million CR redemptions on 26 million is 1/13 = 7.6% so they remain a marginal set

In fact on the half yearly result , we got their view of 6,000 and 15,000 50% off points plus pay out of 26 million so we know the travelling public are calling BS on it (if you happened to have spent $500,000 over a decade, to earn that many points, you know how ticked off you are when it comes to redeeming them for a “decent fare”



PS Even If you bought Top-Up points in the 50% off sale and could actually find a Euro summer CR return ticket YOU would spend. Roughly $8,000 plus co-payments ($4,208) when the actual price on F is around $19,200.
So the CR offer is A substantial discount on the going rate

(And then there’s LAX… $27,000 or something ridiculous!)

 

[Doctore1003]

It makes sense that Qantas goes down this path.

Even at double the price, CR seats would get snapped up very fast.

The only way to ensure a commercially viable *large* increase in supply (assuming that’s the plan) is a large increase in the points cost.

If they offer regular promos where these new seats are discounted (similar to the occasional 30% off CR promos), that could make them appealing for some people.

 

[RichardMEL]

I agree with @levelnine In that this prob will not change CR levels.

My take is that the Rewards+ are tied to commercial fare inventory at the fixed price. Essentially treated like revenue fares at a lower yiekd to QF I guess(if the R+ will provide points/SC is a separate issue though I woukd expect them to tbh). At any rate, CRs come from their own allocation separate to commercial incentory. Thus, in theory, QF have no real reason to change what they allocate to CR inventory.

Of course, they may decide to - maybe down the track - specially if R+ is somehow wildly popular - which I doubt but for now I don't see it

 

[levelnine]

I am really struggling to follow the logic here.

Let me address the points in turn.

1. ' most of us don't make a direct transaction to buy the points for 1 cent. '

That's not what I was saying. What I was saying is that most of us pay for our points. There are almost no free options left to acquire points in Australia. If the ceiling (ie the max value) for a Qantas point becomes 1c/pt, then huge swathes of points purchasing opportunities no longer make sense. The most obvious one is Woolworths points conversions. But there are many others. Think about the Optus sign-up bonuses that people harvested in recent years. People were basically purchasing points for about 0.6c/pt. If the max value you can extract is 1c/pt, chasing opportunities like this become attractive to fewer and fewer people because you are converting fungible cash (the money you pay to acquire the points) into a locked currency where you're forced to fly on Qantas, which is more expensive than its competitors so in reality you're probably getting far less than 1c/pt in value.

2. ' The big points come from sign up bonuses.'

Correct. But you are still paying for points. There are no big sign-up bonuses that come without an annual fee. Those days are long gone. So you're buying points at a discount rate when you sign up for a credit card bonus. The purchase rate has been creeping up over the years as the annual fees get higher and higher. Once you get through the big five providers that still offer good bonuses for low annual fees (Amex, NAB, Westpac, ANZ & St George/BOM), you are purchasing points at quite a high rate. Take, for example, the Suncorp Clear Card: $178 annual fee for 40,000 points = 0.45c/pt. You have to also spend $4,500 to get the bonus. On the assumption that you pay a 1.5% credit card surcharge on half of that spend, that's an extra $33. That takes it to 0.47c/pt. That is only a 2x return on your investment of $211. And you're now locked into flying with Qantas, which as I said is more expensive than its competitors.

3. 'While we are at it, what happens in other markets is irrelevant'

Exactly. I was saying the US is not an applicable comparator.

4. 'I don't understand why you think this new scheme guarantees that the supply of Classic Rewards will remain unchanged. '

Because if they go away and your only option to redeem points is at 1c/pt, fewer people are going to bother collecting Qantas points. They'll simply use a debit card instead. They'll simply redeem Woolworths dollars instead. They'll simply go with the cheapest insurance provider instead of signing up for the overpriced Qantas product that gives them bonus points.

5. 'Most of us never see the premium seats as they get snapped up by WPs before they are visible to the rest of us.'

As I have already shown in previous replies to you in this thread, Qantas already release next to no award seats in premium cabins on premium long-haul routes. The only way to get them is through WP/P1 releases or winning the batch release lottery. You can't go lower than 0. I'm suggesting that they won't further restrict classic award availability further than it already is.

In short, Qantas will no longer be able to sell as many points to other businesses because other businesses won't want as many of them because fewer people will be incentivised to chase them. That is bad for Qantas Loyalty.

Edit: To put it another way, if the only way to redeem points for a J ticket SYD-LAX-SYD is to acquire 1.1million points, no one is going to go to the time & effort (that will take 10+ credit card sign-up bonuses) as well as the cost (it's going to cost $5,500 to acquire those points if they are bought, on average, at 0.5c/pt) to do that. The Qantas Frequent Flyer program would die a quick death.

 

[Economy_Gold]

Of course we don't know yet if R+ is coming, but following this discussion I think it is highly likely. It's not that QF is flying with lots of empty J cabins internationally and therefore it was probably not really realistic that they would significantly increase J rewards simply at something like double the CR level.

On a personal level, I feel that "Qantas is typical Qantas" and like when they announced Lifetime WP the actual thing deeply disappoints when you know the details. Probably a good time to consider other programs...

 

[Gremlin]

Thinking a little more about this move by Qantas, I'd suggest that it ironically ensures classic award seats are not going away anytime soon.

If Qantas had chosen the Singapore model of having saver and advantage awards, we would rightly expect more and more flights to appear predominantly at the higher advantage tier over time.

But this move practically forces Qantas to keep classic awards at roughly current levels because, if they migrate most seats to Rewards+, there will be no reason to collect Qantas points anymore via many channels.

Take Woolworths rewards as a simple example. If Qantas points come to have, for all practical purposes, a fixed 1c/pt value, there's no point converting them from Woolworths — it is the same value. Might as well get $10 off your Woolworth shop rather than $10 off your Qantas flight.

Take regular credit card spend as another example. If Qantas points come to have, for all practical purposes, a fixed 1c/pt value, there's no point spending on a Qantas card where there's a credit card surcharge — the surcharge will typically eclipse the value of the points attained.

I'm sure it's the same for a lot of other promos where you're effectively buying Qantas points at or near 1c/pt. If all you can ever do is redeem them for 1c/pt, you might as well forego the points and save your cash — cash has more optionality than Qantas points.

That would kill the program. The only way not to kill the program is to at least hold out some hope of getting more than 1c/pt in value.

I completely disagree. There are plenty of people that choose to redeem for $10 off at Woolworths. This may be perceived to be poor value to you, but it demonstrates to Woolies and their loyalty partners (including QFF) that there is absolutely a market there for these 'lower value' redemptions.

What it may very well do is make it far less appealing for those gaming the loyalty program shtick, including many of us here on AFF. From a program perspective, those gaming it are indicating that they are typically not very loyal anyway (since they're demonstrating regular churning behaviour when it comes to credit cards and disloyalty in one category is a predictor of disloyalty elsewhere), and they are typically low, and perhaps even negative, value to the loyalty program (maximising redemption value whilst minimising purchase cost of points).

If I'm running a business, I'm going to do more to drive behaviours of those who are generating significant value to my business and mitigate the loss making aspects of those who are not.

 

[levelnine]

I completely disagree. There are plenty of people that choose to redeem for $10 off at Woolworths. This may be perceived to be poor value to you, but it demonstrates to Woolies and their loyalty partners (including QFF) that there is absolutely a market there for these 'lower value' redemptions.

You seem to misunderstand me.

If your only options are to get $10 off your shop at Woolworths or $10 off your next Qantas flight (ie 0.1c/pt redemptions), why would you go to the effort of converting to Qantas points? Especially when that Qantas flight earns you less points and SCs than a flight you bought with cash. Qantas has just lost a whole bunch of customers because they aren't offering them anything more than Woolworths. Indeed, they're offering them something less because these points flights are inferior to cash flights.

 

[SeatBackForward]

Edit: To put it another way, if the only way to redeem points for a J ticket SYD-LAX-SYD is to acquire 1.1million points, no one is going to go to the time & effort (that will take 10+ credit card sign-up bonuses) as well as the cost (it's going to cost $5,500 to acquire those points if they are bought, on average, at 0.5c/pt) to do that. The Qantas Frequent Flyer program would die a quick death.

I think there's a broad assumption of the average QFF consumer being as saavy as participants on AFF with their points. I would suggest far more QFF members are cashing in their points for toasters than the sample here on AFF might.

 

[dylarr]

One thing that will be interesting is how this will work from a class code / RBD perspective... most if not all letters are already being used so I wonder how Rewards+ will show up. Will be interesting to see how this plays out for those that utilise tools like ExpertFlyer to search reward availability.

 

[levelnine]

I think there's a broad assumption of the average QFF consumer being as saavy as participants on AFF with their points. I would suggest far more QFF members are cashing in their points for toasters than the sample here on AFF might.

Sure, but these people were never that invested in the program anyway. They were not going out of their way to earn points. They are cashing in points they earned from a flight to Europe they once took.

If the ceiling for points redemptions becomes 1c/pt, the hundreds of thousands of people chasing points — changing their shopping from Coles to Woolworths to get Qantas points, signing up for different providers to get the bonus points, etc — are all going to start shopping purely on price. The points won't factor into their decision-making anymore. That would be very bad news for Qantas.

 

[RichardMEL]

One thing that will be interesting is how this will work from a class code / RBD perspective... most if not all letters are already being used so I wonder how Rewards+ will show up. Will be interesting to see how this plays out for those that utilise tools like ExpertFlyer to search reward availability.

I think it will work just like old P+P. You will buy a K fare or I fare at a R+ rate.

 

[am0985]

One of the reasons I'm ambivalent about these changes is because - even if you disregard differing award availability between airlines - only a minority of the potential reward seats on QFF for a lot of routes are on Qantas metal.

Taking into account availability, this gets even more the case if you're not Gold/Platinum and outside of one off releases available to all like the one for Jul-Sept 2024.

On a lot of routes there are next to zero QF seats, whereas even though partner availability is nowhere near what it was you can still find some routes via China Airlines/Malaysian/Cathay/Emirates.

Taking the following considerations into account:
1. It seems unlikely QF would significantly limit CR access to elites
2. CR access for non elites was poor already outside one off releases/Points Planes
3. This won't impact partner awards

And we're probably left with cosmetic changes that probably won't move the dial much either way.

I do wonder whether mass releases like the one we had a few months ago or Points Planes become Rewards + releases rather than CR releases.

 

[snabbu]

So I see the changes in the award search function. Many people are not interested in Y awards and want to search J or better only. Even though the usual business option is selected, it seems to show all possibilities including Y fares.

Looking at SYD-CGK in J

Then click the date button brings up stacks of awards available, all in red

Some days have J and some don't - how do we know? Before when you selected Business in the first search bar you were only presented with dates that had J availability.

Am I missing something?

 

[am0985]

So I see the changes in the award search function. Many people are not interested in Y awards and want to search J or better only. Even though the usual business option is selected, it seems to show all possibilities including Y fares.

Looking at SYD-CGK in J
View attachment 373059
Then click the date button brings up stacks of awards available, all in red
View attachment 373061
Some days have J and some don't - how do we know? Before when you selected Business in the first search bar you were only presented with dates that had J availability.

Am I missing something?

That live availability chart is very unreliable, have clicked through multiple of those on other routes only to find no reward seats. Better to cross-check with the multi city tool.

CGK is a pretty decent route for reward seats but not sure about this close to travel date.