Avios changes 2: understanding the new earning rates
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My three articles today look at the headline changes announced by BA yesterday. I will follow this up with some deeper discussion tomorrow.
Key link: ‘Club Changes’ page on ba.com
Here are the other articles in this series you may have missed:
1. Understanding the new tier point rules
3. Understanding the new spending rates
4. What is an Avios point worth after April 28th?
5. Exploiting the ‘no repricing on date changes’ rule
6. Why are off-peak upgrades now more expensive than peak?
7. Save 43% of your Avios on long-haul redemptions if you fly Iberia
8. Partner redemptions may be cheaper if booked on iberia.com
9. What will happen to airline partner earning rates?
10. Are you a winner or a loser overall?
The changes only apply to tickets booked after April 28th. Tickets booked before then will be covered by the current rules, whenever the travel date.
This article looks at the changes to Avios earning rates.
If the bulk of your Avios points come from credit cards, Tesco etc then these earning changes will not impact you much. For others it will mean a massive change.
Here is a summary table of the old and new rates:
Earnings on cheap economy seats drop from 100% to 25%-50%. The minimum number of Avios earned per flight has also been adjusted to reflect this. Instead of earning at least 500 Avios per flight, you are now only guaranteed a minimum of 125 for the cheapest economy tickets.
In itself, I don’t blame BA for changing this in some way. The old system was too generous and this is only moving back to what existed pre 2011.
If this had been the only change made to the scheme, I would have shrugged it off as a shame but also as a return to commercial reality. Giving out 12,000 Avios for a flight to the US in deeply discounted economy did not make a lot of sense. They were giving away a European flight with every long-haul.
However, BA is also making changes at the top end. Fully flexible business class tickets jump from 150% to 250%. This is pointless.
How many people buy fully flexible business class tickets with their own money? Almost none. How many companies let employees pick their airline? Not many, as there are usually bulk deals in place. The banker who has no choice but to use British Airways because the airline has negotiated a deal with his employer sees his mileage jump sharply.
(No changes have been announced to earnings rates on partner airlines but that doesn’t mean that none will be forthcoming!)
BA has also tampered with the status bonus for Silver members:
The Silver bonus drops from 100% to 50%. Again, if I’m totally honest, I could have lived with this if it had been the only change.
The impact of this on a fairly large sub-section of BA customers is huge.
Let’s assume you are a Silver member who flies to Cape Town in deeply discounted economy. Using 12,000 miles as a rough distance, you would earn 24,000 miles for the round-trip. After April 28th, you would only earn 9,000! That is an astonishing drop.
A successful scheme is about increasing marginal spend from EVERY customer. Not your top 10% of customers (who only use you because their employer tells them to) but from all your customers.
BA, on the other hand, has told about 70% of customers by volume that it really couldn’t care less if they continue to fly with them or not. The customers it does want to keep and will reward heavily are those who are effectively forced to buy their product by their employer, an employer who already receives large rebates from BA. If that sounds odd to you, it should.
Click for the next article – understanding the new spending rates
How to earn Avios from UK credit cards (March 2023)
As a reminder, there are various ways of earning Avios points from UK credit cards. Many cards also have generous sign-up bonuses!
In February 2022, Barclaycard launched two exciting new Barclaycard Avios Mastercard cards with a bonus of up to 25,000 Avios. You can apply here.
SPECIAL OFFER: Successfully apply for either of the Barclaycard Avios credit cards by 2nd April 2023 and you will be entered into a free draw to win ONE MILLION AVIOS! Full details are on the application forms here (free) and here (paid). This competition is exclusive to Head for Points readers. T&C apply.
You qualify for the bonus on these cards even if you have a British Airways American Express card:
Barclaycard Avios Plus Mastercard
25,000 Avios for signing up and an upgrade voucher for spending £10,000 Read our full review
Barclaycard Avios Mastercard
5,000 Avios for signing up and an upgrade voucher for spending £20,000 Read our full review
There are two official British Airways American Express cards with attractive sign-up bonuses:
British Airways American Express Premium Plus
25,000 Avios and the famous annual 2-4-1 voucher Read our full review
British Airways American Express
5,000 Avios for signing up and an Economy 2-4-1 voucher for spending £12,000 Read our full review
You can also get generous sign-up bonuses by applying for American Express cards which earn Membership Rewards points.
American Express Preferred Rewards Gold
Your best beginner’s card – 20,000 points, FREE for a year & four airport lounge passes Read our full review
The Platinum Card from American Express
30,000 points and unbeatable travel benefits – for a fee Read our full review
Run your own business?
We recommend Capital On Tap for limited companies. You earn 1 Avios per £1 which is impressive for a Visa card, along with a sign-up bonus worth 10,500 Avios.
Capital On Tap Business Rewards Visa
Get a 10,000 points bonus plus an extra 500 points for our readers Read our full review
You should also consider the British Airways Accelerating Business credit card. This is open to sole traders as well as limited companies and has a 30,000 Avios sign-up bonus.
British Airways Accelerating Business American Express
30,000 Avios sign-up bonus – plus annual bonuses of up to 30,000 Avios Read our full review
There are also generous bonuses on the two American Express Business cards, with the points converting at 1:1 into Avios. These cards are open to sole traders as well as limited companies.
Until 30th March 2023, the sign up bonus on American Express Business Platinum is increased to 120,000 Membership Rewards points – click here. The bonus on American Express Business Gold is increased to 60,000 Membership Rewards points – click here. T&C apply, see the application forms for details.
American Express Business Platinum
Crazy 120,000 points bonus (to 30th March) and a £200 Amex Travel credit every year Read our full review
American Express Business Gold
60,000 points sign-up bonus (to 30th March) and free for a year Read our full review
Click here to read our detailed summary of all UK credit cards which earn Avios. This includes both personal and small business cards.