Avios to Nectar conversion rate devalued! What should you do?

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• NunoBettencourtsPinky says:

  3 Nov3 November 10:24

  Looking at this news in isolation, this is only an issue at this point in time, if you’re a Nectar collector (which I’m not). For me the bigger stitch up is the increase in surcharges that BA are charging for redemptions.

  I take a more holistic view on all this, which is I collect Avios for not doing very much other than signing up to credit cards and spending on them, and I redeem the points I accrue for transatlantic travel at a discount of some sort. Regardless of the actual £ “value” of that discount, it’s still a benefit that I wouldn’t otherwise have.

  • Rob says:

    3 Nov3 November 14:09

    Oddly this changes MR as well.

    The Nectar deal put a floor of 0.8p on an Amex point too, making certain other redemptions (eg Hilton, Marriott) look illogical. The maths now changed here too.

    • Chancer says:

      3 Nov3 November 21:19

      I beg to differ, as usual, regarding Hilton. I have two school holiday bookings at Caribbean all-inclusive resorts next year, which are each getting me circa one cent per point versus the dollar cost.

      • babyg says:

        3 Nov3 November 22:51

        if its a marriott all inclusive id recommending staying somewhere else..

• FionaW says:

  3 Nov3 November 10:46

  I’m not a Nectar collector – apart when getting the Sainsbury’s offers to maximise points for little outlay. We’re sitting on 60k avios which we’ll keep as intending to use up a 2-4-1 to go EDI-LHR Rtn in the New Year to use it up. We booked next years hol GLA-LGW-MRU a few weeks ago on J. Avios has given us self-funding local authority workers the opportunity to fly in business class and even a First to/from Australia/USA etc. What I don’t understand is some of the comments here of sitting on 500k avios or even 1 million avios and not using them. For us – we’ll continue to collect them and if they devalue – well we’ve enjoyed flying in Premium cabins and maybe see what cheaper premium seats can be had with other airlines.

  • Qrfan says:

    3 Nov3 November 11:20

    500k is not exactly a lifetime supply. A family of 4 traveling in club will get through that in two long haul trips even with a couple of 241 vouchers. Im not going to go for a full hog redemption if I can pick up an affordable wt+ ticket and upgrade for a fraction of as many avios. Also had gold upgrade vouchers to burn. It might not be your situation, but it’s not insane.

  • Chris says:

    3 Nov3 November 11:25

    My last work trip In December that will add around another 150k in 7 days. I have done 8 of those kind of trips this year since asian travel has been permitted again. So flying regularly for work the points add up far quicker than I can use them. Have burnt around 400k this year on going to Maldives for a couple of long weekends in F; other than that I will have added another 1m to my total without trying.

• robato says:

  3 Nov3 November 11:05

  While the floor value may be reducing, keeping Avios is still the way to go for me, instead of “cashing out” via Nectar. Twice, I’ve flown first class between LHR-HND for a family of four and that would never have been possible without a sizable Avios balance and 2-4-1 vouchers. Unless there was an arbitrage opportunity via some Nectar bonus, I think Nectar will do nothing at best or match the new transfer rate so you could end up losing Avios if that’s the currency you eventually need.

  • Damien says:

    3 Nov3 November 11:21

    Pity they don’t do First on the Japan flight anymore. I went there in First too. Loved the Concorde lounge.

  • Neil says:

    3 Nov3 November 11:31

    Out of interest…how far in advance do you need to book reward flights in premium cabins to Tokyo? I’d heard it is one of the destinations that tends to sell out very quickly…is it an over the phone 355 days before or not quite that bad?

    Looking at booking something either late 2023/early 2024 so probably need to get myself sorted!

    • Rob says:

      3 Nov3 November 11:38

      Normally it was never an issue but as BA has pulled Osaka and muliple other Asia routes, and as Singapore is effectively impossible to get, this is really the only BA route into Asia.

      As soon as more routes reopen to Asia the pressure will lift but for now ….

    • robato says:

      3 Nov3 November 12:12

      The last time I flew first to Tokyo (2019 pre-covid) I booked it about 6 months in advance and I remember there were lots of other reward options. I’m guessing now you’ll need to plan a bit further ahead.

      • meta says:

        3 Nov3 November 13:38

        I booked 4 months before for Tokyo. If not using a voucher, there are other options such as JAL and also QR and Finnair fly as well (although Finnair is too long of a detour now).

• Claire says:

  3 Nov3 November 11:06

  How long is it taking to an Avios – Nectar switch these days? Says up to 12 days .. Thx

  • Rob says:

    3 Nov3 November 11:43

    This is a security measure to stop fraud. It is deliberately set at this.

    • Paul T says:

      3 Nov3 November 19:38

      With the 12-day period in mind – if I switch, do you know if the transfer rate be locked in from the date of the switch or when the points arrive in Nectar account?

• Peter says:

  3 Nov3 November 11:22

  I think that there is a risk here that Nectar will also devalue the transfer into Avios so this may be a call to action to convert Nectar to Avios now, if Avios is your ultimate currency. Do others see such risk?

  • Rob says:

    3 Nov3 November 11:40

    For Sainsburys they are chasing the bigger picture. They want higher income BA customers in their stores, and if they need to offer you a better than average Nectar deal to do it, it’s worth it.

    Why risk losing £100 of weekly shopping from you just for a minor gain on the Nectar rate?

    • OP says:

      3 Nov3 November 11:57

      Maybe they could start with getting rid of the ‘scan your receipt to exit’ gates they’ve installed at self-checkouts in some branches that make their customers feel not trusted and nudge their ‘higher income BA customers’ to stick to a nicer shopping experience elsewhere 🙂

      Nevermind that from retail experience any theft issues from self-checkouts are not from customers walking through them without paying

      • WillPS says:

        3 Nov3 November 13:56

        The problem is that so many people walk off after tapping their card, without waiting for authorisation. This is costing them millions.

        It’s not about intent.

        • John says:

          4 Nov4 November 13:52

          Really? Millions of what?

      • Mayfair Mike says:

        3 Nov3 November 22:30

        You must live in a lovely area!

      • Will says:

        4 Nov4 November 17:25

        Lots of European countries have this. I’ve had to do this in Belgium, France and Sweden recently.

    • BJ says:

      3 Nov3 November 16:43

      Obviously the picture is much more complicated than just sales growth but I got curious from your comment and had a quick look at that for 21-22 to reflect the switch from Tesco to Sainsbury’s. Tesco reported sales growth of 3% and Sainsbury’s of -2 6% if I got the right data. So either BA avios customers are not all that significant in the grand scheme of things or they are important but their significance is dwarfed by other factors? In either case then why would Sainsbury’s be all that bothered about the avios partnership? Wasn’t it possibly just a case of getting one over their competitor?

      • Rob says:

        3 Nov3 November 16:56

        Marginal revenue is the answer to pretty much every question in travel, and probably travel loyalty.

        • BJ says:

          3 Nov3 November 17:34

          Thanks both, now I’ll need to educate myself on marginal revenue. @JDB, before online groceries I always shopped the supermarket closest to me wherever I lived at the time. Since I started online groceries it was first Tesco and then Sainsbury’s because of BA. However, I did switch to Sainsbury’s before Tesco lost avios. That was when clubcard points became difficult to collect, I found I could do much better with Nectar and conversions to trains when 1p per point promotions were on.

      • JDB says:

        3 Nov3 November 16:57

        Correct, there is no apparent sign within the figures the link up with Avios has done Sainsbury any good. I think there were two drivers – 1) Sainsbury felt they had lost out big time when Tesco took the Air Miles contract from them and it did provide a boost for Tesco then and 2) Nectar just isn’t a very successful loyalty programme and this was an attempt to revitalise it.

        While many customers obviously shop around on price, I think there is quite a core of people who stick to one main supermarket and there has been no perceptible loss to Tesco who were already moving in a different direction to focus on simplicity and price rather more complex loyalty schemes.

• lumma says:

  3 Nov3 November 12:02

  I’m not even sure why this is such a big deal for most. Surely the aim has always been to get 1p+ per point when redeeming? Transferring to Nectar at 0.8p just meant that the bad value redemptions such as hotels made no sense.

  Apart from using the companion voucher, I usually redeem my points for last minute short haul flights when they release extra seats but the cash price is insanely high.

  • Peter K says:

    3 Nov3 November 12:23

    But that is just your personal use.

    I dropped my valuation down from 1p an avios to 0.5p a long time ago, as that is what I would consider letting them go for. It actually rose to 0.8p with the nectar deal, so I chased them more in consequence. Now I need to think more carefully about where to target my spend.

    • Tom says:

      3 Nov3 November 12:30

      Yes, an interesting thought experiment as to whether we would all have been happy with a 0.67p value if they had just set it at that from the outset.

  • BJ says:

    3 Nov3 November 14:31

    I don’t get it either @Lumma! My best guess is that many are spooked by the surcharges and the IB/BA revenue-based earnings, the possibility of revenue-based rewards, and the lack of reward availability. We’ve been here before, things change and the game evolves. Earlier this year there was outrage and forecasts of doom when BA and other airlines hiked surcharges. Back then I asserted that there was never a better time to collect avios. My views have not changed and I don’t see the need for the pessimism and rush for the exit manifest in these pages. Avios remain immensely valuable and HfP will still be here to help guide us through the best and worst of things that come along. Avios Group is extremely successful so they’re hardly likely to risk anything sufficiently major to wreck their success; gamers need to have faith!

• cinereus says:

  3 Nov3 November 13:01

  ffs this is a disaster.

  • Mikeact says:

    3 Nov3 November 13:08

    @cinereus Totally ridiculous comment

    • WillPS says:

      3 Nov3 November 14:47

      I dunno. If you lost £200 worth of cash would you consider that to be a disaster?

      I probably would…

      • KevinS says:

        3 Nov3 November 14:52

        No I wouldn’t.

        • WillPS says:

          3 Nov3 November 16:37

          Fair enough, but I think it’s perfectly valid to rationalise that you’ll lose or not get an amount of money in the hundreds which you had expected to as a disaster.

          I remember when I was a student I lost a load of Wispa Gold bars I’d bought due to a plastic bag with a hole at the bottom of it. That was a disaster for me at the time.

          Everything’s relative.

  • KevinS says:

    3 Nov3 November 13:48

    Good to see people retaining perspective

• Colin says:

  3 Nov3 November 15:17

  Looks like the Race to the Bottom has started again

  • namster says:

    3 Nov3 November 15:33

    Gold member currently looking at a March 2023 , 1 x Economy return from LDN to DXB at 50,000 avios + £100 using the rewards option. Now looking at the cash price in comparison which £540 , This does not make any sense. Where are the reward benefits

    • Freddy says:

      3 Nov3 November 15:34

      Someone will pipe up that avios redemption are fully flexible

    • lumma says:

      3 Nov3 November 15:57

      at 0.8p per point that reward flight is costing you £400 worth of Nectar + £100 cash
      at 0.67p per point its costing you £335 + £100 cash.

      Plus the reward booking is flexible, I’d say it’s actually not a bad deal to go with the reward flight for once, assuming you can’t use the 50k points elsewhere

    • yorkieflyer says:

      3 Nov3 November 16:43

      Economy long haul is rarely a good use of Avios

    • babyg says:

      3 Nov3 November 22:54

      loads of value to be had with qatar business class fares to syd or akl.. not long economy..

      • Ladyshopper says:

        4 Nov4 November 11:14

        Assuming you can find availability of course!

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