Could Virgin Australia turn its invitation-only The Club program into an above-Platinum status level for the airline's most frequent flyers?
That's apparently one option being considered, indicates CEO Jayne Hrdlicka, in ongoing contemplation over the role of the elite program.
The move would see the Velocity VIP tier – which is the formal name for The Club program – opened to Velocity members who regularly earn the equivalent of Platinum status many times over, as an equaliser against Qantas' Platinum One status.
As a benchmark, Virgin passengers much currently rack up 1,000 status credits in 12 months to attain Velocity Platinum.
By comparison, on top of Qantas Platinum's 1,200 status credits threshold, continued flying to hit 3,600 status credits vaults members into the Platinum One category – which comes with added perks and a much higher level of service when flights are disrupted.
This leaves Virgin without a means to recognise and reward its most loyal and most active frequent flyers – and leaves those flyers with no incentive to keep flying with Virgin, instead of perhaps shifting their business across to Qantas to ensure they also hold Platinum status with the flying kangaroo.
Speaking with Executive Traveller on the sidelines of last week's launch of the partnership between Velocity and 7-Eleven, Hrdlicka said "we are working our way through our VIP program design right now, and we will unveil it as we get confidence in exactly what it will hold."
Was there room in the new value-oriented Virgin Australia 2.0 – an airline which has staked out the middle of the market rather than the top end of town – for an elite invitation-only program like The Club?
"That's what we are working through right now, " Hrdlicka said. "We have lots of VIPs who travel with us every day and we want to make sure they that have exceptional experiences every time they travel with us."
Asked if the Velocity VIP could be opened up to 'super frequent flyers' who reach Velocity Platinum status many times over, along the same lines as Qantas Platinum One, Hrdlicka responded "there are lots of different ways you can think through a VIP program and we're considering all the options in what makes best sense for our guests."
Under such a model, those above-Platinum frequent flyers would enjoy access to The Club lounges before their flight.
The fate of The Club
Located at Sydney, Melbourne, Brisbane, Canberra and Perth, Virgin's The Club lounges have largely remained shuttered since COVID-19 struck in March 2020, although Qantas has reopened all of its competing Chairman's Lounges.
In February, Hrdlicka wrote to The Club's estimated 4,000 members, seeking to reassure them that "regardless of what happens with the Club Lounges we will be maintaining a VIP program with the high touch services you know and have loved in the past."
It's not a stretch to see how those benefits could be extended to Velocity Platinums who might clock up 2,000-3,000 status credits in the course of a year, alhough this will be more of a challenge now that Virgin is no longer flying to Los Angeles or Asia, having ditched its long-range Boeing 777 and Airbus A330 jets and contracted to essentially a domestic-only airline with a handful of short-range overseas destinations.
Former Virgin Australia CEO John Borghetti created The Club to compete against the Qantas Chairman's Lounge, with membership reserved for the airline’s most highly-valued passengers: including politicians and high-ranking government officials, business leaders, A-list celebrities and those with enough sway over a company’s travel policies to direct substantial bookings to Virgin and its partners.
Executive Traveller understands that one model being considered for The Club could see membership measured against the booking revenue which could be attributed to that member – a clear focus on the bottom line which would be in keeping with Virgin's new owner, US private equity firm Bain Capital.
What's your take: does Velocity need an above-Platinum tier, and should this be the same Velocity VIP level as enjoyed by The Club members?