The only downside to accumulating piles of FF points is not being able to use them when you want to and on routes and carriers that you want to . Has anyone worked out how much less value FF points as Points Plus Pay vs classic award ?
Issues I see :
FF points in Points Plus Pay have a lower redemption value than classic award flgihts
FF cost on points plus pay bookings can vary
Upside :
Can use when and where you want ?
Unless I have missed some detail in how they can be used .
An additional benefit of points to pay is that you earn points back on the flight and status credits. Taking into account taxes, this sometimes makes the comparison a little more compelling.
My philosophy is that points are a currency you can do limited things with. Cash is different. Sure you can get more if you “wait” for Classic redemption, but if you can’t see this soon then using the points for something you really value is not a waste.
Points Plus Pay fares are essentially normal cash fares and the points have been converted into cash value to pay for the flight. So yes it earns status credits and so on, but that rate is generally really bad compared to classic flight rewards.
Here's an example, Sydney to Perth in business class.
Cash value: $2520
Classic Reward: 36,000 pts + $42 surcharges = 7c per point 'value'
Points Plus Pay: 363,000 points to cover the whole booking = 0.69c per point 'value'
Broadly speaking, your points' worth is absolutely decimated with Points Plus Pay, and it would be best to hold off on them unless you absolutely needed that flight.
Points + pay and ASA are basically what QF (or VA or any other airlines) want you to use your points on. It has a fixed value of 0.5cents per point (cpp). You exchange at that rate to a revenue ticket at a price set by the airline.
To the airlines, they are making profits that way more than you paying cash. Although I don't know the exact cost of QF points that QF sell to the banks, but many sources are saying it being around 0.8-1cpp. So by redeeming it at 0.5cpp, QF is making profits already just from that redemption, plus whatever revenue it generates from selling that seat.
Some people might argue they always earn points from flying so it's free anyway. Again, the profit margin are big there on revenue seats, especially on full flexi fare or business class and above paid by the company, that's way more than enough to compensate for a rebate of 0.5cpp.
Classic award seats on the other hand are seats that airlines don't expect to sell that would otherwise go empty, or they release 1-2 per flight just so that people will continue to collect points. That's why they are much better value and should be the ones to aim for. But they are much harder to come by. Need earlier planning and very flexible with dates and routes.
Either way, the airline wins and that's why FFP generates lots of revenue for airlines.
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Points and Pay vs Classic Award
Eagles94
Eagles94
Qantas - Qantas Frequent Flyer
Member since 02 Jul 2018
Total posts 9
The only downside to accumulating piles of FF points is not being able to use them when you want to and on routes and carriers that you want to . Has anyone worked out how much less value FF points as Points Plus Pay vs classic award ?
Grumpyoldman
Grumpyoldman
Qantas - Qantas Frequent Flyer
Member since 31 Jan 2018
Total posts 13
An additional benefit of points to pay is that you earn points back on the flight and status credits. Taking into account taxes, this sometimes makes the comparison a little more compelling.
Brandon Loo
Brandon Loo
Member since 10 Jul 2018
Total posts 105
Michael Kao
Michael Kao
Qantas - Qantas Frequent Flyer
Member since 06 Nov 2014
Total posts 164
Points + pay and ASA are basically what QF (or VA or any other airlines) want you to use your points on. It has a fixed value of 0.5cents per point (cpp). You exchange at that rate to a revenue ticket at a price set by the airline.