Ansett flyers to be rewarded for loyalty

Old Jan 22, 02, 7:29 am
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Ansett flyers to be rewarded for loyalty

But will anyone come????
Interesting anyway...

(from The Age)
Ansett flyers to be rewarded for loyalty

Wednesday 23 January 2002

Ansett's 2.7 million frequent flyers will not have their
frozen points revived, but the new airline will offer lucrative bonus points to
woo them to join its rewards scheme.

For the first few months of operation, Melbourne businessmen Solomon Lew
and Lindsay Fox will offer better access to free flights in recognition of previous
loyalty and the points Global Rewards members accrue will be multiplied by a
factor, as yet undecided, in the new scheme.

About 70 billion points were suspended when Ansett was grounded in
September. But rather than return a percentage of the lost points as an act of
good faith to recapture customers, the Tesna syndicate - which is poised to
take control from February 1 - wants to offer this "loyalty loading".

According to those close to the Ansett sale, the bonuses will dwarf those
offered by Qantas, the only domestic rival with a frequent flyer program, which
has one offer at present of 1000 bonus points for booking online.

"We are not talking about recognising any liability, although we understand
there is an expectation that we put up a deal," the source said.

"Things are still being
finalised, as a balance needs
to be found between a
marketing dimension and the
financial reality of assuming
such a liability. But it will be
a very attractive offer."

Agitation over the fate of the
Global Rewards points has
grown since Ansett's
administrators, Mark
Mentha and Mark Korda,
last week gave the 70 billion
points, or 27,000 on
average for each member, a monetary value of $140 million. Using the old
airline's redemption calculator, this translated into 4.1 million return economy
flights to Sydney.

Conservative estimates put the unfunded liability at $750,000 to $1.25 billion.
But the administrators have calculated each point to be worth about 0.2 cents.
With the estimate of a return of five cents to unsecured creditors, the average
points holder would receive only $54.

But the Tesna syndicate, although not legally liable to take on the burden of
unredeemed points, understands it needs to offer attractive rewards to their
Global Rewards members to survive.

Diners Club, which is in talks with Tesna abou t the new scheme, is advertising
for a proxy vote for cardholders who lost points.

The administrators have not yet approved the weighting to the votes that
frequent flyers will have but, regardless, it is unlikely they would form a bloc big
enough to vote down the sale to the Tesna group next Tuesday at Vodafone

Another disgruntled credit card provider, Westpac, and a South Australian law
firm, Corsers - representing more than 300 six-figure point members - are
contemplating legal action if the administrators do not improve the $140 million
assessment for the lost points.

Virgin Blue, which has avoided a frequent flyer scheme, yesterday offered
20-cent return flights to Melbourne to up to 60 Global Rewards members "to
help these creditors to have their say" at the creditors' meeting.

The offer, designed for 10 people from six destinations, is available to members
with a minimum of 25,000 points, the average amount required by Ansett for a
return domestic flight.

RichardMEL, UA 1K
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Old Jan 22, 02, 7:19 pm
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I think that if Ansett's new FFP will be as attractive as they say, and be far more valuable than QF, they will attract many customers back.
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Old Jan 22, 02, 8:30 pm
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I worry that giving away multiplier bonuses and whatever to lure pax is all fine and good, but won't they be getting stuck into the same rut that caused a massive FF liability in the first place (with most members points balances, like mine, coming from partners like credit cards and the like?).

Pax won't be so lured to come back by FF because they could get burnt all over again (look at memory of Compass I & II and to a lesser extent, Impulse).

QF's dominance is more profoundly entrenched than ever before, and remember - AN _needs_ those J pax. Not VFR cheapies on $77 one way fares also grabbing FF points and then wanting to redeem them.

I worry. But then again I also worry about having a lot of the old faces back in the management team.

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Old Jan 23, 02, 4:29 am
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Go and have a look at

This solution won't keep them happy. I've never seen a worse bunch of whingers in my life, quite frankly.

As for this solution, I think a combination of increased bonuses and retaining a portion of old points is needed. Not giving back anything may be enough to keep pax away once and for all (I mean why bother, once you've started earning QF points, for example) - what's the point of starting all over again.

I hope they're clever with their program.


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Old Jan 23, 02, 6:18 am
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From "The Age":
Meanwhile Tesna also refused to confirm whether Ansett's 2.7 million frequent flyers would benefit under its new Global Rewards

A Tesna spokesman said the company was preparing a completely new frequent flyer program and could not promise that points from
the former Ansett Global Rewards scheme would be included in any way.

He said Tesna was "acutely aware of the sensitivity of the situation for the administration".

However Tesna staff were focussed on preparing for private ownership of the airline and had not finalised details of the new program.

All the company could promise was that a frequent flyer program was part of the plans, he said.

"It is in the final design stages and we are focussing on the program offerings not the timing of when it will be announced," he said.

While Tesna recognised Global Rewards members of the former Ansett Australia were potentially very valuable customers, it was
unable to say whether points from the old system would be valid under the new program, the spokesman said.

He said Ansett administrators had been "speculating" last year when they released reports indicating the new program would allow
Global Rewards members to recoup a percentage of points if they flew with the new airline.

"The new program is a completely different program," he said.

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