Choice slams frequent flyer schemes: confusing, poor value
The Australian Consumer Association magazine Choice has once again slammed Australia's frequent flyer schemes, saying that most passengers would be better off just buying the cheapest flights on offer.
As proof that airlines get more out of these 'reward' schemes than consumers, Choice cited that Qantas made 60% of its profit last year selling points in its frequent flyer scheme to credit card companies and retailers.
Spokeswoman Ingrid Just says an entry level Virgin Australia frequent flyer member would need to take 13 discount economy return trips between Sydney or Melbourne and Los Angeles to earn enough points to pay for the same trip with points.
A Qantas bronze member would have to fly Sydney-LA return in discount economy seven times to earn enough points to pay for the same trip with points.
(Of course, as Choice points out, frequent business travellers come out well ahead of casual flyers.)
In a best-case scenario, travellers would have to spend $5,000 per month ($60,000 per year) on their credit card to get $1,000 worth of Frequent Flyer points, and if they spent an average amount -- $1,000 a month -- on their card, any points earned would be eaten up by credit card fees.
Choice estimates the approximate value of a frequent flyer point at just one cent, with 19,800 points needed for a Sydney to Perth flight in economy, worth about $198.
However, as Australian Business Traveller has previously pointed out, points can be worth as much as four or five cents each if used to get an upgrade to a higher cabin class on an international flight.
You can read Choice's full analysis here.
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12 Oct 2011
Total posts 23
"A Qantas bronze member would have to fly Sydney-LA return in discount economy seven times to earn enough points to pay for the same trip with points."
That seems to me like a great deal! It's better than my Zambreros card which means that I have to eat a burrito 9 times to earn enough stamps to redeem for the same burrito. And even then if I want guacomole I have to pay extra.
15 Apr 2011
Total posts 582
Choice is missing the point -- these are called "Frequent Flyer" schemes, not "Casual-Discount-Economy-Family-Travellers-Who-Go-To-The-Airport-Maybe-Once-A-Year" schemes for a reason.
I think one free with every seven paid is pretty good tbh. For those of us who are actually frequent flyers, and for whom this system is actually designed, that drops to about one free trip in every 3 which IMO is veeery good.
I do agree with their advice though - if you're not going to actually use the scheme for what it's designed for then please stop ruining it for the rest of us... I miss the days of booking an international award seat 2-3 months in advance rather than 10.