Virgin to retain VIP tier, but maybe not The Club lounges

Some perks are coming back for Virgin's most privileged flyers, says Virgin CEO Jayne Hrdlicka.

By David Flynn, February 19 2021
Virgin to retain VIP tier, but maybe not The Club lounges
Executive Traveller exclusive

Virgin Australia may be going decidedly mainstream with its new mid-market 'value' focus, but CEO Jayne Hrdlicka says the airline will retain a VIP program with perks for its elite flyers.

In pre-pandemic days, this was of course The Club – an invitation-only clique created by former CEO John Borghetti as as an equaliser to the Qantas Chairman's Lounge.

Membership was reserved for the airline’s most highly-valued passengers including state and federal politicians and high-ranking government officials, business leaders, deal-makers and power-brokers, A-list celebrities and those with a great deal of input over a company’s travel policies.

The fate of The Club has been under a cloud since Bain Capital took control of Virgin Australia, and there are now signs that at least in name, The Club could close its doors and be replaced by something a little less ostentatious.

Virgin's The Club is a sanctuary of schmooze for high-flying corporates and captains of industry.. Source: Supplied
Virgin's The Club is a sanctuary of schmooze for high-flying corporates and captains of industry.
Source: Supplied

Read more: Is Virgin Australia's invitation-only The Club set to close its doors?

In an email sent overnight to The Club estimated 4,000 members, Hrdlicka sought to draw a line between The Club as an elite tier – which has always been formally known as Velocity VIP – and The Club lounges and associated 'executive services', which were the most visible sign of the program, while offering assurances that they'd still receive some VIP recognition.

"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," Hrdlicka promised.

"This includes the exclusive benefits you have enjoyed with our concierge services, flexible baggage allowance, preferential seating and reciprocal family benefits."

That said, it's understood that the most indulgent benefits of The Club have long since been wound back.

Also read: We reveal the perks of 'The Club', Virgin Australia's secret VIP tier

Hrdlicka didn't indicate if this "VIP program" would retain its affiliation with The Club brand or become a new invitation-only rung of Velocity Frequent Flyer, sitting above the publicly-accessible Platinum tier.

However, it seems the jury is still out – or at last unwilling to comment – on The Club lounges, as well as what Hrdlicka described as "the end-to-end Club offering."

Membership to Virgin Australia's The Club is on a strictly invitation-only basis.. Source: Supplied
Membership to Virgin Australia's The Club is on a strictly invitation-only basis.
Source: Supplied

"We still have many things to finalise in our program for you going forward," she wrote.

"I know that the future of the Club Lounges is a very important issue. Given the state of play in the industry at the moment with borders continuing to open and close and business still not being fully back in the cities, we are not in a position to make calls on how much infrastructure is sensible to carry forward.

"Once we have a better sense of the future of business travel, we will have more clarity on outlook. You will be the first to know when we finalise the end-to-end Club offering and the future of the Club Lounges."

Lounging around

Under Borghetti, Virgin's well-appointed The Club lounges were a haven for the well-heeled and well-connected, with superb à la carte meals designed by Luke Mangan and a top-shelf selection of wines and spirits.

The Club lounges are secreted away at Virgin's domestic terminals at Sydney, Melbourne, Brisbane, Canberra and Perth, and in most cases are co-located with the main Virgin Australia lounge.

However, December 2020 saw The Club Lounge at Melbourne Airport fling open its doors to all almost anyone who'd usually qualify for regular Virgin Australia lounge access due to maintenance work being carried out in the main Melbourne Lounge.

While the catering is now standard fare, it affords most travellers a rare glimpse inside what was once a sanctuary of schmooze.

As previously reported, Virgin will officially open its new-look Adelaide lounge on Tuesday February 23, ahead of a late March reveal and relaunch of its new business class proposition.

David

David Flynn is the Editor-in-Chief of Executive Traveller and a bit of a travel tragic with a weakness for good coffee, shopping and lychee martinis.

XWu
XWu

09 May 2020

Total posts 509

If JH sought to confuse her competitor (namely QF) on the status of The Club, it is a misguided strategy 

Firstly QF is unlikely to remove its ultra exclusive  invitation only lounge although the product may be different without an obvious competition from VA

It will only create more anxiety amongst other tier velocity members and J class pax on the final product and access to business and other lounges 

Thirdly it really does not show great planning after 9 months after the winning bid, 4 months after formally taking over (and with JH knowing from very early on that she will be taking on the reins however the case Paul Scurrah put on a brave face during the creditors negotiations, a major block of which are the employees unions who had negotiated based on their trust in PS, and his continuing leadership in VA.....) and a great executive team assembled as JH wrote in her first email to velocity members since 11/20.

Seriously I suspect a second year accountancy undergrad on work experience scheme should be able to work out the cost of running the Club and likely hard currency returns plus guesstimating the intangible benefits of providing an exclusive lounge service within a couple of hours of orientation (or maybe I am overestimating the ability of a Gen Y or Millennials or whatever they call themselves nowadays)

Lastly the chain of coy and oblique news release and interviews by JH since November only reflects the indecisiveness of the CEO and her executives, the overwhelming primus to be profit driven from day one at a time when pax confidence are at an all time low from border measures and travel restrictions (although the excursion class pax are still driven by fare costs and probably don’t care much on inflight service and lounge products and priority access), such that these snippets of insights are merely cheap attention seeking to keep VA in the news but the Velocity Loyalty members and business customers are no closer to knowing what’s they are going to get.

Well, I hope they will continue to stick to VA as many here voiced their decision to give JH and VA a go, since as I stated many times I much rather not have more ex-VA loyalists using the crowded QF lounges (and BTW the QF regular lounges is nothing special so don’t whine if you do come over)

QF

12 May 2011

Total posts 7

Isn't the difficulty in assessing the value of the Club Lounges exactly what you can't draw a straight line to on a financial report - business gained by enticing a CEO through a club membership.   

With 4000 members or so about 500 of the membership are Federal MP's and Senators, and State Cabinet Ministers who pretty much all are offered membership.

There are probably a similar number of high profile people (former senior ministers/state premiers/PM's and celebrities of some form).

So those two groups there is a pretty direct corrolation between Club Membership and likelihood to fly Virgin - it is a decision about personal comfort - it is likely all of them have both Chairmans and Club membership.

The business question is about the remaining 3000 - who are likely members because of a substantial business spend/its part of a corporate contract.  Some of those people will have signed the contract because of the club membership, others will have just liked virgin/disliked Qantas, and others will actually have been convinced on particular other features - price, frequency, service to a specific port etc (I know a Club Member who only flies Virgin - and subsequently so does his entire business - because they have consistently served OOL - the airport down the street from where he lives).

Unpicking what the potential damage to your corporate business is is probably not a task for a graduate anyone, it is a pretty nuianced series of guesses and presumptions - particularly for accounts that are big enough to be offered a Club Membership, but where the business isn't big enough to have a similar deal with Qantas and so turning off the Club might just lead to a complete business shift to Qantas.

16 Oct 2012

Total posts 34

I am a mere platinum FF (albeit of seven years standing), and I too received an email from Ms. Hrdlicka last night. Incidentally, it was the first communication from the management team since Paul Scurrah emailed us last year.

In it she told us there would be a “fresh onboard menu in Business class” and a “retail menu in Economy class”. In addition she wrote about the lounge network and frequent flyer program. 

To be honest, the email did not tell me anything I had not already learned from the pages of Executive Traveller and I can’t help feeling it was somewhat too little too late. This was the sort of communication that VA frequent flyers would have appreciated many months ago.

In the absence of that, many of us have already jumped ship. Indeed I am now wedded to the QF frequent flyer scheme after taking advantage of their status match offer and making numerous domestic flights with them in the last few months. My company is now also registered with QF Business Rewards. While I have no particular love for QF, it simply doesn’t make sense for me to switch back to VA now. 

Do I feel like the new management team at VA could have communicated more? Yes. 

Do I feel like they did enough to make me (and other FFs) feel like they valued our business? No. 

Has the horse already bolted in so far as enticing once loyal frequent flyers to stay? I guess only time will tell. 

QF

11 Jul 2014

Total posts 711

Number one point here is that VIP's get harassed in the normal lounge environment, the club lounge is their safe space to sit. VA is kidding themselves if they think they can take that safe space away and not have consequences.

09 Apr 2020

Total posts 12

They must be very special people ;)

17 Jun 2020

Total posts 251

If they're that much of a VIP and demand that much privacy they would be flying on a private jet. 

Qantas - Qantas Frequent Flyer

11 Oct 2014

Total posts 685

oh, c'mon KW72 - could we have a BIT of reality, please ?

Like it or not, it is not unreasonable to consider Members of Parliament (Federal or State) as "VIP's". As @Up,UpAndAway correctly points out above, anyone of recognisable notoriety will be gawked at, pointed at and approached by members of the general public in your average airline lounge. Airlines acknowledge and accept that - and have upper echelon lounges for exactly such purposes.

Frankly, to suggest that such people "should be flying on a private jet" is purely insane. I would FAR prefer that my taxes go to politicians and high level government / public servants travelling on commercial, fiscally rational services rather than calling up a radically expensive RAAF domestic VIP aircraft.

I will willingly admit that there are SOME limited reasons why an RAAF VIP jet may be necessary ie: cabinet sitting in a regional town / city rather than Canberra, a Prime Ministerial visit to some backwater location not included on an airline network etc ~ but for the greater majority of Members of Parliament, the domestic route network coverage of our larger carriers are generally excellent.

Look at the truly wealthy - those in the billionaire class - and most already DO have private jets or their companies own one or more. If Gina or Twiggie need to conduct business in Canberra, do you think they're likely to fly commercial from the Pilbarra to PER, connect to SYD or MEL and then do a (double-connect) CBR segment on a commercial service? Nup - time is valuable. It would be rare to see either in a VIP airline club ~ but the option is there for them, should circumstances dictate.

So, who are you really railling against ?

QF

11 Jul 2014

Total posts 711

A good example of people getting harassed is a very wealthy lady was sitting in the Qantas Club, a group of guys with a few drinks under there belts started sitting with her and taking selfie, Qantas did nothing about it and wouldn't respond. The moment VA found out about the incident they offered her the use of their safe space which she was grateful and then flew VA even after QF countered the offer.

I actually prefer the standard lounge, I normally over hear people commenting about their CEO, Chairman boss etc. You get the giggles and it's interesting the the response when you txt there bosses "have you got some staff in the lounge?"

Qantas - Qantas Frequent Flyer

15 Jan 2013

Total posts 48

They should just turn the "The Club" into a Business Lounge, for Business and Platinum (and VIP) Passengers Only, this will not only help reduce overcrowding in the normal lounges, but also please the unloved platinums and club members. 

Virgin Australia - Velocity Rewards

24 Jan 2018

Total posts 527

Hey 'Kim', I wonder whether the lounge would they be large enough to carry the extra load without becoming 'crowded' ??  Suspect expansion would need to be limited to Business board pass holders only (regardless of status) and no guests, but I'm guessing.   Whether the 'Elite' could cope with riff-raff like us in the same room . . . . ????  But it might encourage more fliers to go Business.  

Qantas - Qantas Frequent Flyer

11 Oct 2014

Total posts 685

Hey @Boeing-Tragic !

I saw what you did there ... 'Kim' Philby LOL :-)))   Very clever.

For a moment, I thought your comment was aimed for me. p-)

Virgin Australia - Velocity Rewards

24 Jan 2018

Total posts 527

One does one's best, KS, one does one's best.  :-)

Qantas - Qantas Frequent Flyer

22 Nov 2019

Total posts 74

The Club looks no nicer than a suburban man cave. The Qantas first lounges are just so so. Aussies cannot do hospitality or lounges like Cathay's range of world standard lounges. Just my opinion, I'm allowed to have one.

Qantas - Qantas Frequent Flyer

26 Nov 2012

Total posts 98

Agree domestically (to a point) but the Flounges are up there and since CX has nothing domestic.... 

Try flying the top end domestic lounges inEurope and the US and you’ll soon appreciate what we’ve got with both carriers 

17 Jun 2020

Total posts 251

Makes sense. Most corporates want to spend the minimum amount of time at an airport and could not care about lounges for domestic flights.

11 Jan 2019

Total posts 5

This is a good move for the airline. There needs to be something between the lounge and the club. It is clear that the club was a significant cost to the airline therefore they need to find something in-between that doesn't cost too much but attracts those who want more than the standard lounge offering. Looking forward to seeing how this goes and hopefully enjoying the VIP offering.

20 Jun 2020

Total posts 33

Without the club, VA VIP status is actually worse than QF P1...

Quizzing a few Virgins sounds like they are just going to make it more exclusive not sure about the size of the lounge if they decrease the amount of people the place already looks empty. 


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