Virgin Australia cuts the cost of doing business

Virgin’s business loyalty program offers upfront savings on flights plus Velocity Gold status and discounted lounge access.

By David Flynn, August 3 2022
Virgin Australia cuts the cost of doing business

Virgin Australia has doubled the discount on Economy Flex Fares for members of its Business Flyer program, from a standard 4% to a pleasing 8%, for a limited time.

Economy Flex Fares are especially popular with business travellers because of, well, their flexibility – which means your flights can change as and when your schedule changes.

A fresh business opportunity arises, such as a presentation or lunch with a prospective client? Move your flight back. That meeting was unexpectedly cancelled? Jet home early.

Changes to your flight are permitted without any fee (although course a fare difference may apply) – Economy Flex Fares can also be fully refunded for credit against future flights via Virgin’s Travel Bank, or refunded back to your original form of payment.

And because not every business travel can fly in ‘carry-on only’ mode, every Economy Flex Fare comes with a complimentary checked bag up to 23kg; also included is standard seat selection (handy for getting yourself next to the window or closer to the front of the plane).

To take advantage of this offer, book your next flight through the Virgin Australia Business Flyer Booking Portal or your preferred travel management consultant by 14 August 2022, for travel through to 14 September 2022.

Virgin Australia is challenging Qantas for the hearts and wallets of business travellers with the launch of its new Business Flyer loyalty program.

With flight discounts, double-dipping on points and complimentary Velocity Gold membership, the scheme will target Australia’s small-to-medium enterprise (SME) market.

And it’s a massive market, covering self-employed solo businesses to companies with up to 199 employees: the Australian Bureau of Statistics estimates that 99.8% of the nation’s businesses are SMEs, totalling two million firms.

No surprise, then, that Virgin Australia wants as much of their travel budget as it can spirit away from incumbent Qantas.

The launch of Virgin Australia Business Flyer follows Virgin’s slashing of baseline business class fares to as low as $299 on key routes such as the Brisbane-Sydney-Melbourne ‘triangle’, and the airline’s new Beyond loyalty offering.

“With the additional airfare discounts we are offering under the Business Flyer loyalty program, on top of Velocity Points earn for businesses, it’s going to be very hard for any business owner to look past Virgin Australia when choosing a domestic airline partner,” says Virgin Australia Group CEO Jayne Hrdlicka.

Promising the airline would continue to “fiercely compete for our fair share of our heartland customers,” Hrdlicka added “we know that’s important for small to medium-sized businesses and corporates who are emerging from the pandemic more conscious of value provided by their partners than ever before.”

To further bolster its appeal to business travellers, Virgin Australia says it will increase the number of flights between Sydney and Melbourne – the country’s busiest route – "during peak business hours" to up to 35 flights per day from the start of July 2022 – the highest level of service frequencies offered since March 2020.

Sydney-Brisbane will also see up to 20 daily flights, with up to 13 daily services between Brisbane and Melbourne, plus up to 11 daily on services between Adelaide and Melbourne.

Business travel rebounds

Hrdlicka told Executive Traveller she was “impressed with how business travel is returning.”

“Big business is back, and growing week on week, well ahead of schedule on what we had estimated”, while small to medium-sized businesses “are on their way to being fully back.”

In both cases, the rebound was driven by the need to rebuild and strengthen in-person business relationships after the past two years kept most people grounded

“Relationships are perishable assets,” she observed. “You have to invest to keep them healthy, and keeping them healthy requires travel.”

So what does Virgin Australia Business Flyer bring to the SME dogfight?

Similar to the competing Qantas Business Rewards program, companies with a Virgin Australia Business Flyer account can earn Velocity Points for every dollar spent on flights, on top of Velocity Points and Status Credits earned by the individual flyer (those Velocity Points earned by the business can then be transferred to any personal Velocity account).

Complimentary Velocity Gold status

Once a company spends at least $2,000 on Virgin Australia flights in the first three months of joining, they’ll receive complimentary Velocity Pilot Gold membership for any two nominated employees, unlocking Velocity Gold benefits such as lounge access, Fly Ahead on selected fare types, a higher checked baggage allowances plus priority check-in and boarding.

And keeping that Velocity Gold card on a rolling 12-month basis will be a doddle: Business Flyer members will need to take just one eligible Virgin Australia flight and earn at least 80 Velocity Status Credits during the first three months of their membership year.

That’s done with a single business class flight between Melbourne and Brisbane; a Sydney-Melbourne or Sydney-Brisbane return business class trip; or one return Economy Flex trip from Sydney, Melbourne or Brisbane to Perth and back.

All companies belonging to Virgin Australia Business Flyer can also enjoy a $379 discounted rate for Virgin Australia Lounge Membership.

Flight discounts in economy, business class

After signing up to the program, which is free to join, Virgin Australia Business Flyer members can immediately tap into discounts on flights through one of the three Business Flyer loyalty tiers

Across all three tiers there’s a standing 4% off Flex Economy fares and 6% off Business Class fares.

Virgin Australia Business Flyer Tier 1 covers SMEs with an annual flight spend up to $9,999, which earn 1 Velocity Point per $1 spent on eligible flights.

Virgin Australia Business Flyer Tier 2 covers SMEs with an annual flight spend from $10,000 to $49,999, and earn 1.5 Velocity Points per $1 spent on eligible flights.

Virgin Australia Business Flyer Tier 3 covers SMEs with an annual flight spend from $50,000 to $300,000, and earn 2 Velocity Points per $1 spent on eligible flights.

The airline promises Tier 2 and Tier 3 members can look forward to “More exclusive benefits and offers” as the Business Flyer program evolves.

Virgin Australia Business Flyer replaces the airline’s Accelerate SME rewards scheme, with Accelerate members being automatically transitioned into Virgin Australia Business Flyer.

Virgin says that former Accelerate customers will receive bonus Velocity Points for their business, for those members who have travelled between from 1 January to 28 February 2022; and an instant ‘tier jump’ to reflect their last 12 months of travel spend with Virgin Australia.

Virgin Australia Business Flyer vs Qantas Business Rewards

So how does Virgin Australia Business Flyer stack up against Qantas Business Rewards for the small-to-medium sized business?

Joining fee: Virgin Australia is trumpeting that Business Flyer is free to join, compared to the $89.50 sign-up fee for Qantas Business Rewards – although at the time of writing his is currently being waived. 

Fare discounts: Virgin Australia Business Flyer offers a flat 4% off flexible economy tickets and 6% off business class across all three membership tiers.

Qantas Business Rewards starts at 6% off domestic flexible economy and business class seats, with 5% on international flexible economy, premium economy and business seats; further discounts kick in on a (potentially confusing) fare class basis at QBR Level 2 and Level 3.

Qantas Business Rewards discounts also extend to international flights – handy for business trips to Asia, the USA and London for example.

Lounge membership: Virgin Australia Business Flyer reduces the cost of Virgin Australia Lounge membership to $379 per year on a per-employee basis, versus $420 for Qantas Club (which also has a $99 joining fee).

However it’s worth noting there are far more Qantas Clubs than Virgin Australia lounges dotted around the country, especially in regional cities and towns; Qantas Club membership includes access to selected overseas airport lounges;’ and Qantas Club comes with many perks that extend beyond just lounge access.

Gold status: both Qantas Business Rewards and Virgin Australia Business Flyer offer complementary Gold status with each airline.

Virgin’s Velocity Pilot Gold is available to all Virgin Australia Business Flyer members, while the Qantas Gold Tier Accelerator is restricted to Qantas Business Rewards Level 3 members; and Virgin provides two Velocity Pilot Gold memberships, while Qantas hands out just one Qantas Gold Tier Accelerator application.

It’s also easier to retain Gold status for a full year with Virgin Australia Business Flyer: you need to earn just 80 Velocity status credits during your first three months, compared to 200 Qantas status credits.

In Qantas’ favour, the airline’s membership of the Oneworld alliance makes Qantas Gold a more globally-minded status as its perks extend across all Oneworld airlines. 

Membership tiers: Virgin Australia Business Flyer sets its tier thresholds based on your annual flight spend, while Qantas Business Rewards are calculated against the number of Qantas Business Rewards points you earn per year. This makes Virgin’s approach far easier to understand and work with. 

Points earning: Virgin Australia Business Flyer lets your company earn 1-2 Velocity Points per $1 spent on base airfares, depending on your membership level; Qantas follows a far more complex formula where the number of Qantas Business Rewards points earned on each flight is determined by the amount of Qantas Points accrued by the person travelling.

Additional reporting by Matt Lennon