Many people who travel love using their hard earned points on flight award redemptions. With so many ways to earn points these days, frequent flyers often have a large balance banked, all of which is a liability for the airlines.
Award availability can be quite restricted, especially during busy periods of the year. This makes getting seats a frustrating experience, with people having to have deep knowledge of when airlines release new seats in order to snag the ones they want.
All Seats For Award Redemptions
Australia’s Qantas has just announced some major changes to their frequent flyer programme. They have introduced what they call “Classic Plus” awards, which essentially allows someone to redeem their points on any flight for sale at 1.5c per point.
Historically the airline offered classic awards – what you see at all airlines, points for award redemptions usually based on the flight distance – and points plus pay. The latter has been gaining traction around the world and is especially helpful for those with small balances, to use their miles to reduce the cost of flights.
The airline, on the other hand, gets to reduce their points liability. Probably a good thing for the accountants! Mainly this is a benefit to the customer though, removing a long standing bugbear when it comes to using points.
Overall Thoughts
Should more airlines follow the Australian airline’s example, it will really make things a lot simpler. Yes, you need to use more points, but for many people this is really not much of an issue. The convenience of booking the flights you want for travel at dates that suit you is a good thing.
I’ve often booked trips using points based solely on the availability of award redemptions. That means fun things like flying out on a Tuesday and returning the following Tuesday, as they were the only days seats were still free. Now it mean I can leave on a Friday night and back Sunday night without having to book 11 months in advance. Well, it would mean that, if I was a Qantas Frequent Flyer!
Perhaps this will start a trend in the industry. I am sure the other airlines will be watching this closely. What do you think airlines should do? Is this something that you would like to see? Thank you for reading and if you have any comments or questions, please leave them below.
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Qantas Premium Economy by Anonymous427 via Wikimedia Commons.
‘Perhaps this will start a trend’??
It’s called dynamic pricing and has been used by the major US programs for years.
Its design to trick foolish loyalty members into thinking redeeming a million points for one flight is a good deal and they should stay loyal.
Smart members know this is a terrible deal.
Oh yes, I know it’s dynamic pricing 🙂 I certainly wouldn’t redeem for this, I far prefer the pricing for the classic type awards, which are much lower. Even so, for some it would be suitable.
A lot of these non-saver awards are an awful value. Some people say that all seats should be available at saver prices and many airlines release an insanely low amount of premium award seats. What I would suggest as a compromise is that an absolute minimum of two seats in every cabin on every flight be made available at saver level and that beyond that half the seats should be available at price-buster cost of double that.
Yes, British Airways do something like this, guarantee a minimum of seats at the lowest level on each flight. I think that’s fair, but it’s also a paltry amount vs the capacity they have in the market and the size of their frequent flyer base. Even so, people seem to think that it’s pretty fair.
It’s already here in the US. Just look at DL, WN, UA etc. All seats are available they give you that redemption rate and you would be better off with a 2% cash back card and holding the cash back earned or even redeeming it into a savings account and just book with cash plus earn say 5x or 10x when you do while earning miles. It no longer feels like you are getting a deal at that point. Just a lot of hoops to jump thru. You’re pretty much not getting anything better than 2% on a domestic redemption… Read more »
I’m even further into the marketing than that! I remember when points were just awarded for flying and so the redemption “cost you nothing” as there’d been “no outlay”. Once you could earn points for basically anything, that’s when the maths came in ruined the fun. I certainly wouldn’t redeem at these rates unless I absolutely had to travel on certain dates, but it does increase the options for those who need to.