NZ*Trout

Exactly. 744 exit row availability followed the same approach.

Eve Rob Fyfe trotted out the line that entitlements had not changed.

I've given up on NZ. Everything is so complex now and the overall value proposition is at best on par with alternative airlines.

(For the benefit of AlastairR: Another airline now throws me low-cost-to-them-but-high-value-to-me loyalty bones, and in return they automatically gain my business largely without regards to price. $75 for my preferred long haul exit row may be considered by many as value for money and it hardly breaks the bank - but it tells me exactly how AirNZ value the loyalty based relationship we've had for the past 500 odd sectors together...)

DCF

I don't think Confirmed Upgrades is/was an Airpoints issue - it should have been an ancillary revenue program.

It was the failure to position it as what it should have been (i.e. Ancillary Revenue) which saw it under-valued and scrapped. But because it is viewed as a terminated Airpoints program, nobody notices that we HVCs now buy lower fare-bucket fares now because the program which drove us to buy YBMHU fares has gone.That was the whole problem, and the reason why a popular and profitable program got axed.

Confirmed Upgrades should have become a cash-denominated program instead of Plusgrade, which could be simple, transparent and easy and cheap for the airline to administer itself.I looked up the Confirmed Upgrade rates yesterday: a Trans-Pacific PE to BP Confirmed Upgrade from U class into Z class cost $1010 Airpoints.

Air New Zealand can only dream of that now. They are currently upgrading via OneUp, and compared with the abandoned Confirmed Upgrades the OneUp program involves upgrades.......

1) from far cheaper Premium Economy fare buckets, and
2) into far more expensive Business Premier fare buckets
3) with massively reduced OneUp bids compared with the $1010 Confirmed Upgrade fixed price (seemingly averaging around $500 per accepted long-haul OneUp, but superimposed upon lower original ticket types),
4) they have to share the OneUp revenue with Plusgrade.

Lastly, of course, they piss off their elites with OneUp, whereas with Confirmed Upgrades they pleased us and had the potential to earn more money.

As I wrote, they just needed to take Confirmed Upgrades out of Airpoints and into cash-denominated Ancillary Revenue.

It's frustrating both as a disenchanted HVC but also as a pragmatic supporter of the airline (who understands the need for Ancillary revenue) that they have axed a perfectly good model for optimising upgrade revenue in favour of a lousy and expensive outsourced one.

Confirmed Upgrades was a really sound idea, that needed a small amount of reform to make it into

1) a cash revenue stream
2) a driver for passengers to buy higher-fare bucket tickets in the first place
3) a program which HVCs saw as a perk.

Instead it got axed in favour of a lottery which the airline has to pay someone else to manage, and which antagonises pretty much every HVC.

ajnz

This used to be possible with a number of fare types. Sector Upgrades were available and booked into O and J (or maybe Z) class. I used them on a number of occasions - IIRC O used to be $300/sector and Z was $1500 (from an economy fare - maybe H basis).

baldingeagle

Interesting discussion.

I'm not sure about going back to confirmed upgrades as a cash-paid system. Doesn't that sort of undercut the regular fares? Why would a customer pay $4500 for a C/D BP fare, when they could buy U for $2600 and an $1150 confirmed upgrade?

Also I think it strengthens the loyalty program to have such convenient upgrades, but restricted to payment in APD. Once open to cash, I think it devalues things a bit and probably becomes harder for them to manage.

In place of OneUp, if they really wanted to maximize the revenue from unsold inventory, they could blast out an email to all passengers 24-hours before the flight (after all confirmed upgrades have cleared) saying "An upgrade is available for $xxx...". The amount would of course change depending on the number of available seats, plus whatever other factors they wanted to throw in. This would give visitors, infrequent flyers, etc. (who probably have no APD) a chance to upgrade, and is certainly easier to understand than having to go through the OneUp wheel of Doom. No reason that couldn't be done in house either, why are they paying a third party to "manage" this stuff?

AlastairR

Yes this is correct, it will be counted as a standard bag if you have booked after the 22nd of Nov change

DCF

With respect, I'm not arguing for that version of Confirmed Upgrades.

Firstly, Confirmed Upgrades didn't let someone snaffle a Business Premier fare for a knockdown price. They allowed someone buying the most expensive Premium Economy (or Economy) fare bucket to access very limited inventory in the cheapest Business Premier (or Premium Economy) fare bucket, by paying a very large amount ($1010 one-way across the Pacific, for example).

Secondly, the key to this being seen as Ancillary Revenue would be for it to be a cash transaction. And at that point it is easy to manage - when you apply you put your credit card details on your application.

Thirdly, remember that this incentivises us to buy U class when A/O/E are available, or YMBH when LSGK etc are available. That is a big buy-up.

Fourthly, allow access dates to be driven by Airpoints status (so GEs go before G go before S) but allow cash ayment because that affects the bottom line.

Rotodavid123

+1
Yes I for one have taken most of my $60k per year travel spend to QF and "advising" my employees to do the same (about the same spend). I know in the scheme of things QF isn't a great program, but its sure a lot less confusing and as a regular TT flyer with WP status, it works much better for me.

All that NZ will get next year is enough flights to requalify as GE (810SP) with the balance required coming from credit card spend.

They have already lost one TT flight next year because when I went to book it the other day, all the "free" PE seats were taken and they wanted to charge me $10 more for the vacant ones across the aisle (25C) -

AlastairR, if you'd care to take a scroll through my BA97 flight diary over the past 3 years you will see what started as pretty solid "Blue koru" is now heavily "red Roo". This has been driven by the constant changes and devaluing of the service you provide your HVC's.

OT, but worth noting in an ironic way - I earn almost as many APD on my Amex Plat CC when I buy my QF TT Y fares as I would have gotten had I actually booked & flown NZ -

Thai-Kiwi

I credited my recent (company booked) SQ flights WLG-SIN to my empty TG account because Airpoints was such a poor return on a fully flexible SQ fare of 40 APD total (2x 20 APD!!). NZ treats this as SQ flexi fare as discounted economy.

At least with TG the 12,000 miles I earned I have a choice of $80-140 hotel value, a one waydomestic biz flight in Thailand ~ $200 value or (just about) a domestic economy return in Thailand ~ $300 value.

Actually, scanning the BA97.com flight records of many members here might be useful for AlastairR to see the extent of travel made by FTers here, and with whom they fly.

baldingeagle

Well I mostly agree (not that my opinion really matters, I'm only Silver but the workings of the system interest me).

The incentive to by full-fare (YBMH/U) should have been a strong component of the old system, which just leads me to wonder why they changed it? Even if they were losing money with Airpoints upgrades, it seems like it would have been far simpler to adjust the redemption amounts (earn has been touched plenty!) to make it work for them. I'm still not sure if having it cash-based is better than a tweak of the old system though, only because it seems to strengthen the loyalty program if you have to use the loyalty currency (assuming you get rid of "OneSmart", etc. as well).

Or lower the Star Alliance award travel redemption amounts. Wouldn't it be in NZ's favor if more customers redeemed their APD for travel on other carriers vs. NZ inventory that could potentially be sold to a revenue pax? The redemption amounts are so high though relative to the current earning amounts that it's a pretty-much useless component of the reward system.

Anyway, we're way OT. Hopefully Alistair comes back around with some more input.

craver

I think they will be neither surprised nor interested in HVCs leaving NZ in their droves for the competition. Hard to believe perhaps, but it must be true. If they had been concerned about the loss of HVC business they would have played the last year or so very differently.

In the execution of NZ's deliberate change in strategy, the loss of HVCs is surely just being chalked up to collateral damage.

ASJOHNSTONE

I should know this but

"but its sure a lot less confusing and as a regular TT flyer with WP status, it works much better for me."

What does WP status mean ?

Thanks

deconz

Qantas/Virgin Australia Status Abbreviation Summary:
CL: Chairmans Lounge
WP1: Platininum 1 (Qantas only) (also PO, W!, WP!, ÜW [Über W@nker])
WP: W@nker Platinum
SG: Scum Gold
PG: Partner Gold
QP: Qantas Pub (er Club) Member
VP: Virgin Pub (er Lounge) Member
PS: Plebian Silver
NB: Nufin Bronze (Qantas only)
NR: Nufin Red (Velocity Only)

NZSportsTech

AlastairR - Welcome to the forum. I have an ancillary revenue question for you.

What do you think people who have paid for a business fare think of getting advertisements before every movie / episode on IFE? Surely shelling out $10k for a airfare would entitle you to watch the IFE without being pestered by repetitive ads?

Trumpkin

I suspect that the target audience for most of the adverts, especially the yacht one, is aimed exclusively at those flying in business or premium economy, so they are unlikely to be removed.

However there may be a better way to do this. For business and premium economy allow people to opt out or at least just show adverts once per flight.

For those in economy who have paid works / works deluxe, let them see adverts for say the first two programs they watch.

For those in economy who do not pay for IFE, show them adverts at a similar rate to those seen on TV.

Anyone GE, who by definition flies often and thus will see the adverts often, let them just see them once per flight at the most no matter where they sit.

This will benefit everyone, with premium passengers seeing some but not as many adverts all the way to the low cost people getting IFE without paying for it directly. Plus there is a perk for GE.

AlastairR

Yes this is correct - if your sporting equipment is less than 2m in lenght it will be treated as a standard bag

thanks