Hey Big Speenders
Airlines love to post eye-catching deals but frequent flyers should stick to Flex fares if they want to jump tiers, collect bonus miles and secure their premium status,
Most aspects of travel are straightforward, but airline loyalty? It remains a web of miles, points, tiers, fares and upgrades, filling online forums day after day. I find it puzzling for different reasons; the inbox will always be full of routes, openings and deals but I can go weeks without receiving anything on loyalty.
The ambivalence may be partly attributable to carriers who, on the one hand, are keen to court premium-spending frequent flyers, while on the other, posting cheaper fares which will fill their cabins but do little for their yields – or your status.
Corporate budgets may be squeezed but business travellers should stick to the fundamentals. They need to fly regularly on Flex fares which yield bonus miles and only by sticking to the higher fares will they jump tiers or maintain their premium status. To reach the top-tier Platinum with Emirates, for example, you need to rack up 150,000 miles which works out 24 sectors a year, or say, a flight every two weeks. Maintaining your status is important for all the add-on benefits that come from a premium membership, from increased baggage allowances and lounge access to chauffeur pick-ups, which all help make life on the road more enjoyable and productive.
There are other benefits too. Alongside ticket flexibility, if you’re travelling in Emirates economy on a Flex or Flex Plus fare you won’t have to pay for advance seat reservation (fees were introduced on Economy Special and Saver fares last October). Flex also offers you the possibility to upgrade before the flight, whereas Saver you can only upgrade 48 hours before (you can jump one cabin).
“Flex is very important in two aspects,” says Skywards’ Senior Vice President Dr. Nejib Ben Khedher.“If you talk about an economy ticket, flex gives you higher tier miles and if you’re status driven, it’s 2/2.5 times higher with the miles you earn.”
Uncertainty has crept in with the way airlines have recalibrated loyalty in recent years. Formerly, you could rack up miles by ticking off time zones, even at the back of the plane, but in the new world order, it’s all about revenues. Consequently, Emirates is looking into releasing more “personalised rates” taking into account how much members spend with them, and it’s little wonder Platinums are so well courted – on average they spend 3.5 times the amount of Gold members.
“There is an aspect of revenue which is captured through the fare brand but tomorrow even that base will not be that static – it will depend on the fare on that sector and the yield. That’s something we’re looking into. So hopefully those buying the higher fares will get higher incentives. We’re doing a lot from a data science perspective, to understand members’ behaviour better – so rather than pushing out a promotion by email, we’re
trying to make it much more targeted.”
Skywards is a complex operation, reaching 18 million members as it enters its 18th year, and adding around 220,000 members a month. While silver is growing about 8 per cent, and platinum 4 per cent (15,000 members), the overwhelming number are locked in blue.
Much like the airline it serves, Skywards is an international business with UK, US, Australia, UAE and India accounting for its top five markets, and between them they have more than a million members each.
America’s position is particularly interesting, given all the bans and laptop restrictions, with US business growing by more than 25 per cent a year. But exchange rates have been a thorn in its side. “Exchange rates do hit our bottom line – we have a big base in the UK and seen the revenues drop there, but we’ve been able to keep our average revenue per member in the UAE.”
In line with wider digital changes, upgrades have received an upgrade. Emirates introduced upgrade requests last April, and received 16,000 responses from members and 32 per cent “indicated positively” – although only 43 per cent of took them up.
The system was enhanced in October, when ‘auto upgrades’ were introduced, allowing upgrades to be processed and miles taken. The third element, now in testing phase, displays upgrades on emirates. com when they are available, during the booking stage. Again, this won’t be sent to all and sundry, but targeting travellers who may need a push to jump a tier, or stay in the existing one.
An Emirates spokesperson said: “It’s early days but we have already seen a good number of members specifically choosing flights on which there is upgrade availability versus other available flights on the same day.”
One aspect which never changes is how important upgrades are to frequent flyers, accounting for 31 per cent of redemptions, compared with 25 per cent on cash plus miles and 16 per cent on flights. Most passengers actively look for upgrades when planning trips, with around 6075 per cent booking upgrades ahead of the 48-hour travel window. Dr. Nejib said offering the service through mobiles is “in the pipeline”.
CASH PLUS MILES
Last summer Emirates introduced cash plus miles, appealing to the many members who haven’t enough points for flights (seven million members had less than 40,000 miles). For the airline, it provides the opportunity to engage with passengers who haven’t been on board for a while – 28 per cent who took up cash + miles were “inactive” in the past year (astonishingly, it is estimated passengers globally are sitting on 9.7 trillion unused miles).
Moreover, with 83 per cent take up from the Blue tier, it gives Emirates the chance to showcase premium cabins to a new segment of travellers. “We want the person who has never flown business to give them a taste so we can capture them later on,” said Dr. Nejib.
The service also extends to passengers before they get on board, with Dubai Duty Free accepting cash plus miles for purchases.
PARTNERS TO TOP 100
This summer Skywards will reach the 100 partners milestone and while the bulk of partners cover conventional travel (15 airlines, 54 hotel and travel partners), lifestyle is among the fastest growing (currently 12).“You can expect to see more emphasis on lifestyle partners in the coming months,” said Dr. Nejib. The airline continues to push its global reach and a tie-up with Rocketmiles,
an online travel booking platform (sister to booking. com) provides access to 400,000 properties globally. “It’s friendly in terms of search, it’s been a soft launch but we’ve seen a lot of activity as people see a good use of their miles in terms of redemption and earning.”
DIFFERENT WAYS TO SPEND MILES
There are plenty of ways to spend your miles beyond upgrades. Treat yourself or a client to a ‘money can’t buy’VIP experience.“Miles are really becoming a currency which you can buy products or experiences,” said Dr. Nejib.“For F1 events, we had an auction up to 300,000 miles so people do have miles to burn.” Redeeming 4,500 miles at Dubai Duty Free will save you AED75. More than 500 products are available on the Emirates High Street store and its delivery network now stands at 80 markets with Taiwan and Argentina recently joining.
EARN MILES WITH PARTNERS
Earn Skywards miles when renting a Hertz car (hertz.com/emiratesskywards). Look out for the 15 airlines partners listed on the website – most allow earn and burn, though easyJet allows redemptions at 7,500 miles but no earning.
QANTAS ROLLS OUT PREMIER MASTERCARD
Qantas has unveiled details of its new miles-earning credit card. Users will be able to earn two Qantas Points per A$1 (US$0.7) spent with Qantas using the Citi-issued Qantas Premier Mastercard. This includes flights, Qantas Club membership and the Qantas Store. Overseas purchases earn 1.5 points per dollar spent, and eligible purchases in Australia earn one point. Points earning is uncapped, and a bonus of 60,000 points is accrued upon spending A$3,000 (US$2,240) within the first 90 days after the card is approved. Additional benefits attached to the card include two complimentary lounge invitations each anniversary year, complimentary travel insurance and up to 20 percent off select domestic companion fares once per year for bookings made through the Qantas Premier Concierge.
FLEXIBILITY DRIVES OPEN PROGRAMME
Flydubai’s Open programme, launched last October, offers instant redemptions, no blackouts and cash plus miles. The revenue-based programme features Open and Gold tiers with one point per dollar spent
Skywards’ Senior Vice President Dr. Nejib Ben Khedher
Below: Flydubai’s Open co-branded credit card with Dubai Islamic Bank provides up to three points per dollar spent
Above: Qantas Premier Mastercard