Qantas frequent flyers face deal change
Qantas frequent flyer members have lashed out on social media at the airline's decision mid-2014 to change how points are earned.
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Qantas frequent flyer members think of their points as a right rather than a reward, which will trigger a backlash over a revamp of the airline's loyalty program, a leading aviation commentator has warned.
The airline "ought to be very careful in how they tread in this area" because of increased competition from Virgin Australia, the editor of AirlineRatings.com, Geoffrey Thomas, told Fairfax Media.
"Two to three years ago, Qantas didn't have any competition in business class or full service economy, but they now face very real competition from Virgin Australia," he said.
"Today, many people are members of both Qantas and Virgin Australia loyalty programs, and they can make choices to swing one way or the other if one is annoying them.
"Passengers don't think of it as points; they think of it as dollars.
Mr Thomas said the change was "absolutely profit driven".
"Doing something like this may look good to an accountant on paper, but in the cut and thrust of intense competition, this may be a frequent flyer point too far."
Under the revamp, announced on Thursday night, customers will earn points based on their ticket class, rather than the distance flown.
For example, a customer flying from Australia to London on a discount economy fare, which includes sale tickets, will receive 6200 points, while those travelling on a more expensive flexi-saver will receive 12,400 points.
The airline will also reduce the number of status credits that discount customers earn with partner airlines.
This will make it harder for those customers to reach the program's silver, gold, or platinum level.
Gold and platinum frequent flyers are given free access to the Qantas Club and earn more points when they travel.
The changes come into effect on July 1.
Qantas sent an email to its 9 million Frequent Flyer members outlining the revamp, and assuring them they would not affect current points balances, or the way points are earned with airline partners.
"When it's time to redeem, there's no change to the number of points you need for a Classic Award, or how you use your points for your chosen reward," it said.
Qantas said the changes were designed to reward customers who booked more expensive fares.
"It's all about creating a fairer, more simplified program, designed to align the number of Qantas points and status credits you earn more closely with the fare you pay, where you fly and the airline you choose," it said in the email.
A Qantas spokeswoman said members would accumulate more points on more expensive flexible fares.
She said the airline will introduce a new points earning table for Qantas and Jetstar, which will be followed by partner airlines.
Qantas has also reduced the minimum points guarantee for members flying on economy and discount economy fares from 1000 to 800.
The Qantas program is one of the most popular airline loyalty programs. Points are currently awarded based on distance, with bonuses that vary depending on travel class. Points can also be earned via Qantas-affiliated partners, such as Oneworld airlines, credit-card providers and hotels.
Consumer group Choice spokesman Tom Godfrey said the news did not bode well for consumers.
"A lot of consumers who are looking for discounted airfares and seeking to get a benefit from signing up to a rewards program will have to think twice before looking at Qantas," he said.
"Maybe it's time Frequent Flyers should change its name to Premium Purchases, because, at the end of the day, Qantas is not rewarding your loyalty or how far you fly, but rewarding the premium price you pay for tickets."
The changes have prompted anger from Frequent Flyer members on Twitter, with some slamming Qantas' decision as a "high buyer" scheme.
But Mr Thomas believes Qantas' reputation is "good enough to withstand the backlash in the long run".
"Yes, they've taken a bit of a battering, but as long as they continue to deliver a valued product, they will survive," he said.
Australian Business Traveller editor David Flynn said that for some passengers, the changes will be a case of "the golden handcuffs".
"Can they afford to walk away from their bank of frequent flyer points and their shiny VIP cards by shifting to another airline?" he said.
"Certainly, the passengers paying top dollar for their tickets won't see any disadvantage; in fact, they'll come out better off, which is exactly what Qantas wants."
Mr Flynn said that despite the timing of the changes, they intend to "make it easier for travellers to work out how many frequent flyer points they'll earn on any given flight and type of ticket".