The Sainsburys Reward Flight Saver for Golds thread.
Jan 28, 2021, 11:04 am
#1
Original Poster
Join Date: Aug 2019
Location: Tenerife
Programs: BA Gold, BA AMEX PP, Amex Platinum
Posts: 434
The Sainsburys Reward Flight Saver for Golds thread.
Mods: Please don't roll this into the Nectar thread, as it's a little modelling project I am working on so want it to stay OT.
The recent Nectar tie up is a complete game changer for a leisure traveler like myself & Mrs Geek purely from a redemption / status chasing perspective. For us it mostly put's RFS to shame in terms of the cheaper tickets available and I will try and explain why as best as an IT geek can.
Some bloggers value Avios at 1.1 / 1.2p, but in those calculations they don't account for the Avios lost on a reward flight vs a cash flight. { Which varies based on status / distance / fare class. } To make the explanation simple using their calculation methods I shall use a 1p target valuation which makes an off peak return RFS from LHR to INV in Y 8000 Avios + £35 = £115. But you don't need hold bags, and the cash price for the return flight is £60, so a very poor use of Avios Indeed.
But I have 8000 Avios to burn, and I need to go to Sainsburys anyway for the weekly shop so I convert 6250 Avios into 10000 Nectar points and use them for £50 off my shopping. With the £50 I saved on my shopping, I book my £60 Inverness flight and PP with 1000 Avios for another £10 off my ticket.
Woohoo, I just paid 7250 Avios for my ticket which is less than the Avios I would use on the RFS with zero cash. But even better as a GCH I am now getting 1250 Avios for the flights, so my net cost is actually 6000 Avios = £60 = 1p per Avios, and am getting Tier points for the flight to boot!
And there are better valuations than that to be had for Golds { Less so for Silver but still good ones. } but the rule is the lower the cash price & the further the distance the more bang per Avios you will get for your buck. The best example I could think of off the top of my head is the cheapest HBO return fare for a week in Lanzarote in Y @ £70 and this works out at 4210 Avios return at a valuation of 1.66p per Avios. { Effectively Buy one, Get one Free! }
Of course a GCH would never be seen dead in either Economy, Sainsburys or Lanzarote, but the staff have to travel, be fed and have a vacation themselves.
{ The cheapest £262 CE fare to ACE works out @ 1.1p per Avios too though. }
So first of all, I welcome anyone to break my math, and secondly am curious to see who can do better than Lanzarote for all classes including W.
TIA
The recent Nectar tie up is a complete game changer for a leisure traveler like myself & Mrs Geek purely from a redemption / status chasing perspective. For us it mostly put's RFS to shame in terms of the cheaper tickets available and I will try and explain why as best as an IT geek can.
Some bloggers value Avios at 1.1 / 1.2p, but in those calculations they don't account for the Avios lost on a reward flight vs a cash flight. { Which varies based on status / distance / fare class. } To make the explanation simple using their calculation methods I shall use a 1p target valuation which makes an off peak return RFS from LHR to INV in Y 8000 Avios + £35 = £115. But you don't need hold bags, and the cash price for the return flight is £60, so a very poor use of Avios Indeed.
But I have 8000 Avios to burn, and I need to go to Sainsburys anyway for the weekly shop so I convert 6250 Avios into 10000 Nectar points and use them for £50 off my shopping. With the £50 I saved on my shopping, I book my £60 Inverness flight and PP with 1000 Avios for another £10 off my ticket.
Woohoo, I just paid 7250 Avios for my ticket which is less than the Avios I would use on the RFS with zero cash. But even better as a GCH I am now getting 1250 Avios for the flights, so my net cost is actually 6000 Avios = £60 = 1p per Avios, and am getting Tier points for the flight to boot!
And there are better valuations than that to be had for Golds { Less so for Silver but still good ones. } but the rule is the lower the cash price & the further the distance the more bang per Avios you will get for your buck. The best example I could think of off the top of my head is the cheapest HBO return fare for a week in Lanzarote in Y @ £70 and this works out at 4210 Avios return at a valuation of 1.66p per Avios. { Effectively Buy one, Get one Free! }
Of course a GCH would never be seen dead in either Economy, Sainsburys or Lanzarote, but the staff have to travel, be fed and have a vacation themselves.
{ The cheapest £262 CE fare to ACE works out @ 1.1p per Avios too though. }So first of all, I welcome anyone to break my math, and secondly am curious to see who can do better than Lanzarote for all classes including W.
TIA
Last edited by The Geek; Jan 29, 2021 at 7:30 am
Jan 28, 2021, 11:48 am
#2
Moderator, Iberia Airlines, Airport Lounges, and Ambassador, British Airways Executive Club
Join Date: Feb 2010
Programs: BA Lifetime Gold; Flying Blue Life Platinum; LH Sen.; Hilton Diamond; Kemal Kebabs Prized Customer
Posts: 63,850
Would it not be easier to advise the staff to use cash on cheaper flights rather than RFS?
Jan 28, 2021, 12:02 pm
#3
Original Poster
Join Date: Aug 2019
Location: Tenerife
Programs: BA Gold, BA AMEX PP, Amex Platinum
Posts: 434
Humour me on this though, most of the Nectar debate to date has centered around the "earn" potential and valuations rather than the "burn". { One example being, if you are chasing a few hundred TPs, you can theoretically fund it entirely with surplus Avios via Sainsburys / Argos / eBay. }
Last edited by The Geek; Jan 28, 2021 at 1:05 pm
Jan 28, 2021, 5:52 pm
#5
Join Date: Jan 2008
Posts: 3,840
Not so much break your maths, but question how long your assumptions will hold.
You have assumed an Avios earned as the same value as an Avios spent. That probably works fine in the short term, but frequent flier programmes have a tendency to devalue over time. I would say that is particularly the case in the current uncertain environment. A bit like time value of money, you might apply a discount rate to your Avios depending on your time horizon to spent them. i.e. longer time horizon, bigger haircut to reflect uncertainty as to the value when you actually use them.
You’re also (presumably?) comparing a flexible Avios fare with an inflexible cash fare. That flexibility has some value.
You have assumed an Avios earned as the same value as an Avios spent. That probably works fine in the short term, but frequent flier programmes have a tendency to devalue over time. I would say that is particularly the case in the current uncertain environment. A bit like time value of money, you might apply a discount rate to your Avios depending on your time horizon to spent them. i.e. longer time horizon, bigger haircut to reflect uncertainty as to the value when you actually use them.
You’re also (presumably?) comparing a flexible Avios fare with an inflexible cash fare. That flexibility has some value.
Jan 28, 2021, 6:21 pm
#6
Join Date: Aug 2010
Location: London Stratford, E7
Programs: BAEC Gold! Thanks to FT
Posts: 3,382
I was thinking this the other day and have shifted all of my modest sum to Nectar points. I’ve redeemed a couple of Caffè Nero vouchers and my go to drink is currently a Mint Hot Chocolate with whipped cream that’s £3.80 PLUS the Nectar drinks vouchers count as a stamp on Caffè Nero loyalty scheme so 9 drinks gets another one free. Anybody with O2 priority can also get a stamp towards a Caffè Nero free drink once a week too.
Jan 29, 2021, 1:43 am
#7
Join Date: Nov 2015
Location: London
Programs: BA Gold
Posts: 1,683
Not so much break your maths, but question how long your assumptions will hold.
You have assumed an Avios earned as the same value as an Avios spent. That probably works fine in the short term, but frequent flier programmes have a tendency to devalue over time. I would say that is particularly the case in the current uncertain environment. A bit like time value of money, you might apply a discount rate to your Avios depending on your time horizon to spent them. i.e. longer time horizon, bigger haircut to reflect uncertainty as to the value when you actually use them.
You’re also (presumably?) comparing a flexible Avios fare with an inflexible cash fare. That flexibility has some value.
You have assumed an Avios earned as the same value as an Avios spent. That probably works fine in the short term, but frequent flier programmes have a tendency to devalue over time. I would say that is particularly the case in the current uncertain environment. A bit like time value of money, you might apply a discount rate to your Avios depending on your time horizon to spent them. i.e. longer time horizon, bigger haircut to reflect uncertainty as to the value when you actually use them.
You’re also (presumably?) comparing a flexible Avios fare with an inflexible cash fare. That flexibility has some value.
Jan 29, 2021, 1:50 am
#8
Join Date: Feb 2003
Programs: Sir CT-UK - Streaker pour les autres.
Posts: 5,901
I read you math with interest and thought wow, so much effort, so little time to save such a little.
The I read this "Of course a GCH would never be seen dead in either Economy, Sainsburys or Lanzarote, but the staff have to travel, be fed and have a vacation themselves. { The cheapest £262 CE fare to ACE works out @ 1.1p per Avios too though. } and thought what a nob.
The I read this "Of course a GCH would never be seen dead in either Economy, Sainsburys or Lanzarote, but the staff have to travel, be fed and have a vacation themselves. { The cheapest £262 CE fare to ACE works out @ 1.1p per Avios too though. } and thought what a nob.
Jan 29, 2021, 2:03 am
#9
Join Date: Mar 2020
Programs: British Airways GGL/CCR, Hilton Diamond & Marriott Gold
Posts: 2,612
I read you math with interest and thought wow, so much effort, so little time to save such a little.
The I read this "Of course a GCH would never be seen dead in either Economy, Sainsburys or Lanzarote, but the staff have to travel, be fed and have a vacation themselves. { The cheapest £262 CE fare to ACE works out @ 1.1p per Avios too though. } and thought what a nob.
The I read this "Of course a GCH would never be seen dead in either Economy, Sainsburys or Lanzarote, but the staff have to travel, be fed and have a vacation themselves. { The cheapest £262 CE fare to ACE works out @ 1.1p per Avios too though. } and thought what a nob.
Jan 29, 2021, 3:52 am
#11
Join Date: Jun 2005
Location: London, UK
Programs: BA Gold, AA Plat, HH Diamond, IHG Platinum.
Posts: 75
The options are:
Pay the Avios RFS Price: 100000 avios + £473.33
Pay the Cash price £622.74
Convert 78000 Avios into £624 in cash to spend in Sainsbury's / Argos and use that value to buy the cash fare
The last option earns 21768 avios for a gold so net spend is 56232 avios + £0 cash and you get 180 tier points which you wouldn't get with the RFS
Jan 29, 2021, 4:05 am
#12
Original Poster
Join Date: Aug 2019
Location: Tenerife
Programs: BA Gold, BA AMEX PP, Amex Platinum
Posts: 434
I read you math with interest and thought wow, so much effort, so little time to save such a little.
The I read this "Of course a GCH would never be seen dead in either Economy, Sainsburys or Lanzarote, but the staff have to travel, be fed and have a vacation themselves. { The cheapest £262 CE fare to ACE works out @ 1.1p per Avios too though. } and thought what a nob.
The I read this "Of course a GCH would never be seen dead in either Economy, Sainsburys or Lanzarote, but the staff have to travel, be fed and have a vacation themselves. { The cheapest £262 CE fare to ACE works out @ 1.1p per Avios too though. } and thought what a nob.
Sorry you didn't get the humour, it wasn't meant in a derogatory way. Just an extrapolation of the humour from this legendary thread which I wrongly assumed everyone round these parts had read. I have included a link to it in the original post.
Last edited by The Geek; Jan 29, 2021 at 5:24 am
Jan 29, 2021, 4:34 am
#13
Original Poster
Join Date: Aug 2019
Location: Tenerife
Programs: BA Gold, BA AMEX PP, Amex Platinum
Posts: 434
Not so much break your maths, but question how long your assumptions will hold.
You have assumed an Avios earned as the same value as an Avios spent. That probably works fine in the short term, but frequent flier programmes have a tendency to devalue over time. I would say that is particularly the case in the current uncertain environment. A bit like time value of money, you might apply a discount rate to your Avios depending on your time horizon to spent them. i.e. longer time horizon, bigger haircut to reflect uncertainty as to the value when you actually use them.
You’re also (presumably?) comparing a flexible Avios fare with an inflexible cash fare. That flexibility has some value.
You have assumed an Avios earned as the same value as an Avios spent. That probably works fine in the short term, but frequent flier programmes have a tendency to devalue over time. I would say that is particularly the case in the current uncertain environment. A bit like time value of money, you might apply a discount rate to your Avios depending on your time horizon to spent them. i.e. longer time horizon, bigger haircut to reflect uncertainty as to the value when you actually use them.
You’re also (presumably?) comparing a flexible Avios fare with an inflexible cash fare. That flexibility has some value.
Flexibility.
Short notice flights.
Upgrades.
2-4-1 Vouchers
Peak Holiday Flights. { Inc Gold priority rewards. }
But unless these are part of your usual flying patterns, they require "manufacturing the value" to achieve. For instance, if I travelled a lot for my business and had school aged children, there is no doubt that all my Avios would be all committed to a combination of the above.
We are in the fortunate position that government restrictions permitting, we can travel when and where we like, but part of being able to do so is achieving value within our budget. We aim to achieve 1p+ per Avios and do so when the opportunities arise, but even then we are running a 200k+ annual surplus. Yes one day we plan to use a chunk for a 2-4-1 F redemption to tick that off the bucket list, but that is in the "manufactured value" category. The Nectar tie up has completely changed the game for us, as even though the "headline rate" is 0.8p per Avios { which if is value in day to day life } theoretically deployed against reward flights and tier points, the Avios can become significantly more valuable.
Most here have highlighted the cheapest / best way to accrue more Avios, on the complete other side of the fence there are now ways for Nectar point collectors to accrue significantly more Nectar points. { Shopping via the BA eStore for example earns more Nectar points than using the card directly. } I'm just pointing out the value to be had in a dual strategy.
Our own strategy has just shifted to burn the surplus Avios via Nectar. I would say ditto to those accruing surpluses from work travel, and those that will chase status with Tier point runs etc.
Last edited by The Geek; Jan 29, 2021 at 4:57 am
Jan 29, 2021, 5:01 am
#14
Join Date: Jan 2008
Posts: 3,840
Appreciate the inflation / deflation angle, but can only go with what's on the table today. In normal times the flexibility can be useful, but for the foreseeable future that isn't so valuable due to BWC. Don't get me wrong here I get Avios redemptions can be great value for...
Flexibility.
Short notice flights.
Upgrades.
2-4-1 Vouchers
Peak Holiday Flights. { Inc Gold priority rewards. }
But unless these are part of your usual flying patterns, they require "manufacturing the value" to achieve. For instance, if I travelled a lot for my business and had school aged children, there is no doubt that all my Avios would be all committed to a combination of the above.
We are in the fortunate position that government restrictions permitting, we can travel when and where we like, but part of being able to do so is achieving value within our budget. We aim to achieve 1p+ per Avios and do so when the opportunities arise, but even then we are running a 200k+ annual surplus. Yes one day we plan to use a chunk for a 2-4-1 F redemption to tick that off the bucket list, but that is in the "manufactured value" category. The Nectar tie up has completely changed the game for us, as even though the "headline rate" is 0.8p per Avios { which if is value in day to day life } theoretically deployed against reward flights and tier points, the Avios can become significantly more valuable.
Most here have highlighted the cheapest / best way to accrue more Avios, on the complete other side of the fence there are now ways for Nectar point collectors to accrue significantly more Nectar points. { Shopping via the BA eStore for example earns more Nectar points than using the card directly. } I'm just pointing out the value to be had in a dual strategy.
Our own strategy has just shifted to burn the surplus Avios via Nectar. I would say ditto to those accruing surpluses from work travel, and those that will chase status with Tier point runs etc.
Flexibility.
Short notice flights.
Upgrades.
2-4-1 Vouchers
Peak Holiday Flights. { Inc Gold priority rewards. }
But unless these are part of your usual flying patterns, they require "manufacturing the value" to achieve. For instance, if I travelled a lot for my business and had school aged children, there is no doubt that all my Avios would be all committed to a combination of the above.
We are in the fortunate position that government restrictions permitting, we can travel when and where we like, but part of being able to do so is achieving value within our budget. We aim to achieve 1p+ per Avios and do so when the opportunities arise, but even then we are running a 200k+ annual surplus. Yes one day we plan to use a chunk for a 2-4-1 F redemption to tick that off the bucket list, but that is in the "manufactured value" category. The Nectar tie up has completely changed the game for us, as even though the "headline rate" is 0.8p per Avios { which if is value in day to day life } theoretically deployed against reward flights and tier points, the Avios can become significantly more valuable.
Most here have highlighted the cheapest / best way to accrue more Avios, on the complete other side of the fence there are now ways for Nectar point collectors to accrue significantly more Nectar points. { Shopping via the BA eStore for example earns more Nectar points than using the card directly. } I'm just pointing out the value to be had in a dual strategy.
Our own strategy has just shifted to burn the surplus Avios via Nectar. I would say ditto to those accruing surpluses from work travel, and those that will chase status with Tier point runs etc.
Jan 29, 2021, 5:12 am
#15
Join Date: May 2012
Location: Munich, Algarve, Sussex or S.F Bay Area
Programs: Mucci, BA Gold, A3*Gold, AA Plat, HH Gold, IHG Plat Amb, Marriott Plat
Posts: 4,164
All this really shows is the poor value Avios redemptions have become. Even RFS redemptions, while theoretically of great value when cash ticket prices are high, are usually poor value once redemptions are available and cash prices for those flights compared. The "sweet spots" if there are any in Avios redemptions are US domestic flights on AA and now AS, short intra-Asia hops (especially in J) and UUA where APD can be avoided. That has not changed due to the tie-in with Nectar. What has changed, is that there is a defined lower-limit valuing an Avio at 0.8p and anybody redeeming for anything less (ie. for a larger Avios part-pay) would be better off spending the Avios via Nectar in Sainsbury's. Obviously exceptions will apply, but using Avios for hotels, car hire or wine has mostly become redundant with this change.