Will Qantas respond??

[aus_flyer]

Some very interesting news from Virgin Australia this morning about changes to (the now) 'Velocity Frequent Flyer' program.

Do you think Qantas will respond? If so, how?

 

[Simsy85]

Nope.





They'll ignore it, hope it goes away.

 

[TonyHancock]

Do you think Qantas will respond? If so, how?

Based on the last 12 months I think they will:

Increase the SC's needed to hit WP to 1800
Remove F lounge access for WP's on international flights (unless flying F, actually in retrospect they'll still remove it if you are a WP)
Do away with Any Seat Awards
Do away with points upgrades altogether
Remove priority boarding altogether
Provide a scanner in the QP to allow FF's to scan their membership cards



I suspect we'll find out soon enough. They will need to do something. I wonder if the international upgrade improvement might be first up?

 

[markis10]

Increase the SC's needed to hit WP to 1800

Red Roo has already stated no change in earn/requal levels planned.

 

[TonyHancock]

Red Roo has already stated no change in earn/requal levels planned.

I did put four sticky out tongues to avoid ambiguity between reality and attempted humour!!!

 

[simongr]

I think that they will respond but I think it will be virtually impossible for them to compete. This unfortunately is one of the problems with a workforce that is more expensive - they don't some of the wriggle room to squeeze out benefits. Couple this with bad/unlucky investment decisions (delays to both A380 and 787) and you have QF in the position that they are now in.

 

[UP4014]

I think old Al has his hands full at present. :mrgreen:

 

[harvyk]

I say they will respond, but it's probably not going to be an overly revolutionary response, plus I expect QF will be trying very hard to remind us that they are the "Australian Airline", expect to see lots of kids singing as a big part of their response.

Edit: Maybe not - DJ has posted a $67.8 million loss for FY10-11. QF may very well simply play the sit and wait game...

 

[williamsf1]

how about the following ....

for P1
- instant confirmation of International upgrades ( sub to availability)
- Return of any time lounge access
- Points upgrades confirmed earlier from waitlist


ability to waitlist domestic upgrades
more chances closer to departure for confirmation of upgrades as seats are released due to cancellations ( ie today is just one round )

 

[Danger]

how about the following ....

for P1
- instant confirmation of International upgrades ( sub to availability)
- Return of any time lounge access
- Points upgrades confirmed earlier from waitlist


ability to waitlist domestic upgrades
more chances closer to departure for confirmation of upgrades as seats are released due to cancellations ( ie today is just one round )

How about QF delivers the existing benefits they state for each level of membership before they go creating a whole new level and a whole new group of people to upset.

 

[anat0l]

I think they will not respond.

QF are sitting on a huge number of accounts which constitute - for all intents and purposes - a lock-in of those doing business with them. Unfortunately, 99% of us are not those kinds of people.

If QF had the same cost bases as VA, there would be no problem right now. But they don't.

QF may lose all the business of the AFF community, but will they change? I think they won't, and if they do, it'll be to 'appease' their customers of which AFF is not part of said demographic.

 

[djfuzz]

how about the following ....

for P1
- instant confirmation of International upgrades ( sub to availability)
- Return of any time lounge access
- Points upgrades confirmed earlier from waitlist


ability to waitlist domestic upgrades
more chances closer to departure for confirmation of upgrades as seats are released due to cancellations ( ie today is just one round )

That's all well and good - but what about your vanilla Platinums stuck between 1200-3599 SCs?

In addition to abandoning existing benefits (anytime access), failing to deliver others (priority boarding), and increasing the benefits of every other tier, QFF has made its Platinum level look progressively less appealing. There's only so much reduction that is reasonable to put up with in order to maintain access to the FCLs before the fact that Virgin is delivering all of the other benefits starts to look like a much better proposition as a customer.

anat0l raises some good points, but QF's changes have impacted more than just the AFF demographic. Whether or not they can retain their existing corporate accounts should give them pause, but more likely they're more concerned about how to turn QFd into a purely CityFlyer business and replace QFi with JQi, while walking away with a handy private equity handshake. :/

 

[Taezar]

vanilla Platinums

Platinums who aren't into interesting sex.



Oh come on - it is what we were all thinking - right?

 

[djfuzz]

Platinums who aren't into interesting sex.

I think you're referring to missionary Platinums.

 

[Justchecking]

I think that they will respond but I think it will be virtually impossible for them to compete. This unfortunately is one of the problems with a workforce that is more expensive in.

You do realise that all QF crew who joined anytime in the past 4yrs are on less money than DJ crew? That's true for domestic and international FAs. QFs 13 A380s are all crewed by B scale crew. Only the 747s are crewed by A scale which are mostly being retired in the next 12 months. Even their casuals are cheaper since they get no benefits, annual leave or sick leave. QFLink crew are on about the same as newbie DJ crew. FYI, info given to me by an A scale crew member at QF. Jetstar crew are most definately on lower T&Cs than DJ too.

 

[trippin_the_rift]

I think they will not respond.

QF are sitting on a huge number of accounts which constitute - for all intents and purposes - a lock-in of those doing business with them. Unfortunately, 99% of us are not those kinds of people.

If QF had the same cost bases as VA, there would be no problem right now. But they don't.

QF may lose all the business of the AFF community, but will they change? I think they won't, and if they do, it'll be to 'appease' their customers of which AFF is not part of said demographic.

Unfortunately I'll have to disagree with you on this one Daniel.

Qantas needs to respond quickly to avoid a mass exodus of Platinums. There are a lot of juicy carrots on the Virgin table, which only seem to be getting bigger and better as the months pass by. By contrast, Qantas have not added anything new to the Platinum list since 2003 and infact have been reducing overall benefits ever since.

QF's corporate accounts are very 'oldskool' and have very deep roots so those are solid, but QF can't survive purely on these accounts.

The biggest thing to look at is the future. Virgin are investing in goodwill while QF is not. As a business owner my spend is decent, but as more and more of my staff need to travel for work - what kind of picture do you think I'll paint to my board when airline spend and travel polcies come up? Every uber DYKWIA frequent flyer was a nobody at one stage, and from my experience they learn and rewards those who helped them when they were small. QF is doing a brilliant job at destroying their future in this sense.

Qantas has no choice but to respond quickly with Platinum One and international upgrade changes if they want halt the slide of their domestic market share. For the first time in 10 years there is a real FF competitor who outshines Qantas. This is a very real threat to the QF business.

 

[anat0l]

anat0l raises some good points, but QF's changes have impacted more than just the AFF demographic. Whether or not they can retain their existing corporate accounts should give them pause, but more likely they're more concerned about how to turn QFd into a purely CityFlyer business and replace QFi with JQi, while walking away with a handy private equity handshake. :/

It does impact more than the AFF demographic, however it's still not an overwhelming amount. But since we're all here, we can definitely say for ourselves that we are all affected by all this (i.e. either we are sick of QF, or all of us are now challenged with a new VA value proposition).

We often say things that we assert to be representative of the greater traveling public. To some extent this is true, but in a more accurate way it isn't. This is why even though QF and VA are competing for the "same customers" on overlapping fields, they still have different strategies.

Only when QF see some of their stolid corporate accounts go to VA then they will probably think very hard. Right now it is them who is raking in all the money. And convincing faceless organisations can be a tough sell sometimes. They only have an airline in mind for the sake of it, and sod the rest of the points, lounge access etc. (which is why sometimes it's unfair when you are, say, a QFF elite but the boss decides you're flying to ORD on a SYD-LAX QF flight followed by a LAX-ORD UA flight, even if that means you would've saved money in not buying baggage and a few drinks that you bought in the airport cafe and not for free in the lounge.)

QF can't keep making the profits it is making with the "admittedly lacklustre" FFP that it has and get away with it, even before the relaunch of VFF. That can only mean that people like us are not the significant driving forces (you'd be lucky if this forum contributes, collectively in total (members and family only), approximately $10 million to QF in raw revenue). So where are the rest of the big fish? Must be corporate accounts.

VA is not coming from the same perspective. That is why they marketed differently to people before and still are. They are fighting from the opposite end of the scale / demographic.


We all think that the choice for domestic carrier and FFP is as obvious as white bread. So why doesn't everyone do it straight away? Are we saying that "they are all (travelling public and all) stupid"? Can't be...............

 

[TonyHancock]

I don't think there is any doubt that QF will respond. Alan Joyce has already said that there will be changes ahead. I think 4th quarter was the timescale.

The only thing in doubt that I can see is the scale of the response. We know that WP1 will come into being and we know that international upgrades will change in some way. Having sat back and watched VA's announcement today QF can make it's assessment and announce it's enhancements now.

 

[anat0l]

Unfortunately I'll have to disagree with you on this one.

Qantas needs to respond quickly to avoid a mass exodus of Platinums. There are a lot of juicy carrots on the Virgin table, which only seem to be getting bigger and better as the months pass by. By contrast, Qantas have not added anything new to the Platinum list since 2003 and infact have been reducing overall benefits ever since.

QF's corporate accounts are very 'oldskool' and have very deep roots so those are solid, but QF can't survive purely on these accounts.

The biggest thing to look at is the future. Virgin are investing in goodwill while QF is not. As a business owner my spend is decent, but as more and more of my staff need to travel for work - what kind of picture do you think I'll paint to my board when airline spend and travel polcies come up? Every uber DYKWIA frequent flyer was a nobody at one stage, and from my experience they learn and rewards those who helped them when they were small. QF is doing a brilliant job at destroying their future in this sense.

Qantas has no choice but to respond quickly with Platinum One and international upgrade changes if they want halt the slide of their domestic market share. For the first time in 10 years there is a real FF competitor who outshines Qantas. This is a very real threat to the QF business.

No one can deny that what VA have done with VFF is a real threat. It's near impossible to argue against that.

But to what extent is this truly a real undoing for QF?

If I were to cut off one of your arms, would you die? More than likely not. Your life would be a lot harder, however, and there would be a lot of things in your life you could never do again (including some things you would normally take for granted on a day to day basis). But, you are not dead, and certainly not incapacitated.

There is a similar analogy here; call it a Saw style challenge for QF in a way. Yes, there will [-]probably[/-] be an exodus of Platinums, but just how many, and how much in dollars, and how much would it mean to QF (just like cutting your arm off)? QF will lose members, but we really need to evaluate just how many they will lose in real terms. Your call is that it would be significant enough that QF couldn't keep operating. Even if they lose all of your business, what real cost does this affect QF? They have destroyed your goodwill in them, your future prospects of your business ever flying with them, and perhaps you can influence 50 other companies to do the same. Until several of you achieve that and give that business to VA, we're not going to see major movement from QF. At least, "major movement" as defined by AFF (for the travelling public, we tend to think that they should know better).

Also, let us pray that VFF and VA will persist with these changes. 10 years down the track, no one wants to bring up this thread and say "this is QF under Joyce all over again". This is not a nay-saying argument, but so far history has not been very kind to people like us.

I don't call Platinum One and domestic priority boarding as "responses". Yes, they have not been fully implemented yet (the latter especially), but these were coming anyway and not a response directly to neo-VFF (even with knee-jerk "last minute" changes now, should they happen - and we can't judge this). In this sense, this is why I believe QF will not respond to what has happened. They will implement some other things, but they will not be direct responses.

And, as I said before, given the new proposition by VA it would not surprise me that QF will lose all the business collectively on AFF (or at least they will lose all QFF business). But will it really matter to them?

 

[Simsy85]

Unfortunately I'll have to disagree with you on this one Daniel.

Qantas needs to respond quickly to avoid a mass exodus of Platinums. There are a lot of juicy carrots on the Virgin table, which only seem to be getting bigger and better as the months pass by. By contrast, Qantas have not added anything new to the Platinum list since 2003 and infact have been reducing overall benefits ever since.

QF's corporate accounts are very 'oldskool' and have very deep roots so those are solid, but QF can't survive purely on these accounts.

The biggest thing to look at is the future. Virgin are investing in goodwill while QF is not. As a business owner my spend is decent, but as more and more of my staff need to travel for work - what kind of picture do you think I'll paint to my board when airline spend and travel polcies come up? Every uber DYKWIA frequent flyer was a nobody at one stage, and from my experience they learn and rewards those who helped them when they were small. QF is doing a brilliant job at destroying their future in this sense.

Qantas has no choice but to respond quickly with Platinum One and international upgrade changes if they want halt the slide of their domestic market share. For the first time in 10 years there is a real FF competitor who outshines Qantas. This is a very real threat to the QF business.

Your both right.

Your right in QF should respond. but others are right in they won't.

I wouldn't even bet on those "solid accounts" anymore... VA for the last 6mths have been sniffing around large business' and Government for new travel options.

They even recently put on a team of Business Account Managers and Government Account Manager.

VA are hardcore going after QF, QF are just too blind to see it.