Rex set to launch frequent flyer program

Australia will soon gain a third domestic frequent flyer program, with Regional Express readying its own loyalty scheme to take on Qantas and Virgin Australia.

In an investor presentation released yesterday for the 2023 financial year, which saw the airline post a statutory profit of $14.4 million, Rex listed a “Frequent Flyer Programme to be launched in Q1 FY2024” as part of its “Outlook & Profit Forecast.”

Given that the Q1FY24 period runs from July to September, this indicates the Rex Frequent Flyer program is mere weeks away from launching. A spokesperson for Regional Express declined to offer additional details.

The debut of the long-awaited Rex Frequent Flyer scheme will be a significant step in the airline’s ambitions since it began Boeing 737 jet services between Sydney and Melbourne in March 2021.

Rex now counts seven destinations in its inter-city jet network, connecting Sydney, Melbourne, Brisbane, Adelaide, Canberra, Hobart and the Gold Coast with a fleet of Boeing 737 jets fitted with both business class and economy seats.

And that network itself is set for more growth: Rex took delivery of its eighth 737 in June, while the investor deck promised "additional flying with 2-4 additional B737-800NGs to the fleet" to come.

Deputy Chairman John Sharp has long trumpeted “our ambition to fly between every capital city in Australia.”

A 2020 presentation to investors and sighted by Executive Traveller listed the launch of the Rex Frequent Flyer program as a ‘strategic milestone’, with an eventual value between $1 billion and $1.6 billion “in 3-4 years” after capital city flights commence, at which point the airline predicts it will reach a total market capitalisation of $5 billion.

Rex has also said its frequent flyer program will link up to the SkyMiles loyalty platform of US partner Delta Air Lines under an alliance announced in May 2022 to encompass reciprocal connecting flights, ticketing and baggage services on each other’s network.

Rebooting Rex Flyer

Prior to its foray into the jet era, Regional Express operated a loyalty program called Rex Flyer, which operated along very simple and straight-forward lines: take nine paid flights and get one flight for free.

It’s speculated that the rebooted Rex Flyer will skew towards a more conventional points-based system, with travellers earning some form of ‘Rex Points’ according to the type and value of ticket they buy.

Whether this would also include some form of status credits, which in turn would deliver selected perks such as lounge access and upgrades to the airline’s most frequent flyers, remains to be seen.

The airline’s Business Flyer program remains active and is aimed at travellers who belong to a business with an ABN (and carries a $99 two-year membership fee).

The business owner and employees can attach their Rex Business Flyer membership number to a Regional Express booking; for every sector flown under the membership number, the business receives one point.

Earning 18 points within two years sees the business given two Reward Flights: these are valid for any seat on any Rex flight within the following six months, and can be booked for anybody, not just the business owner or staff.

Room for three?

But there’s no doubt the Rex Frequent Flyer program will have to muscle its way into a loyalty landscape dominated by two well-established players.

The behemoth Qantas Frequent Flyer scheme and Virgin Australia’s competing Velocity Frequent Flyer each list close to 15 million members on their books, although there’s considered to be a high degree of duplication between Qantas and Virgin due to travellers holding membership and status in both programs.

Rex may also launch its own frequent flyer program with a status match against Qantas and Velocity Silver and Gold tiers, similar to the current status match promotions available through the Qantas Tier Accelerator and Virgin Australia Discover Gold offers.

The typical perks of a frequent flyer program range from priority services such as check-in, boarding and luggage handling and a more generous luggage allowance to preferential seat selection and airport lounge access.

From an airline revenue perspective, a crucial part of the Regional Express loyalty proposition will be the ability to earn frequent flyer points on the ground through a network of carefully-chosen retail partners.