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Forums Frequent flyer programs The British Airways Club Times article: the money behind Avios

  • 1,176 posts

    Interesting article in today’s Sunday Times on the Avios business:

    https://archive.is/8p1w3

    Was new stuff for me at least.

    225 posts

    Long may the golden goose lay!

    HfP Staff
    2,867 posts

    This is actually pretty accurate, which is surprising for these things. Oddly they didn’t speak to us, which would have corrected the few errors that did creed in.

    25 posts

    Saw what you did there Rob!😉

    1,176 posts

    This is actually pretty accurate, which is surprising for these things. Oddly they didn’t speak to us, which would have corrected the few errors that did creed in.

    Errors that ‘creed’ in 🙂

    Sorry, couldn’t help myself.

    225 posts

    This is actually pretty accurate, which is surprising for these things. Oddly they didn’t speak to us, which would have corrected the few errors that did creed in.

    Interested to know what they got wrong…?

    HfP Staff
    2,867 posts

    80% of Avios business is not outside IAG – it only looks that way because of the transfer pricing used when selling points to IAG airlines. As a % of Avios issued, IAG airlines are still dominant.

    Avios Group financials have always been published (we’ve written about them) – was never a secret. It just wasn’t broken out in IAG’s accounts.

    You can’t count brands in the eStore as ‘partners’ – most companies in there don’t even know they are on the Avios eStore.

    Uber is paying Avios around 0.8p, not 2p.

    You can’t redeem Avios directly with Marriott for a hotel room.

    Hotel redemptions get you 0.5p, not 1p, per point.

    The BA Amex earn rate is not a ‘point of difference’ because Barclays matches the rates!

    National Trust is not an Avios partner – it may be on the eStore but there is no formal relationship. Same with John Lewis.

    Andrea Burchett was never CEO of Avios Group, highest she got was ‘Head of Commercial’.

    Andrew Swaffield was recently retired from Virgin Red.

    This is why you should never trust what you read in the newspapers ….

    225 posts

    This is brilliant, thank-you Rob!

    1,475 posts

    The Uber 2p error is a bit obvious.

    1,262 posts

    The Uber 2p error is a bit obvious.

    “Take a hypothetical example”

    I’m thinking that if they reported the actual rates and details of the contract Avios would be a tad peeved.

    2,259 posts

    @Rob, when we can’t rely on The Times for quality journalism and fact checking we may as well just give up.

    That’s a pretty shocking E&O list for just one article.

    1,456 posts

    @Rob, when we can’t rely on The Times for quality journalism and fact checking we may as well just give up.

    That’s a pretty shocking E&O list for just one article.

    Was considering paying for a Times sub, but if this is the quality, forget about it.

    324 posts

    @Rob, when we can’t rely on The Times for quality journalism and fact checking we may as well just give up.

    That’s a pretty shocking E&O list for just one article.

    Was considering paying for a Times sub, but if this is the quality, forget about it.

    Unless the pricing is wrong, hint, overseas edition

    11,768 posts

    With all the different examples of how you could use avios, a Marriott stay seems really odd 🤷‍♀️
    Though I’m not complaining at the lack of info about using them on long haul J and F 😂

    721 posts

    @Rob, when we can’t rely on The Times for quality journalism and fact checking we may as well just give up.

    That’s a pretty shocking E&O list for just one article.

    If you ever read a broadsheet news article designed for a general audience (all papers) about absolutely any subject where you are particularly specialised/knowledgeable then it’s laughable how poorly informed or miscomprehended most of what is written by generalist print journalists is. This is universal as general news journalists are writers paid to make a subject readable, not deep level experts. Even where you can tell they do know their stuff, explaining obscure nuances and qualifying statements doesn’t sell papers or make articles readable, so they will semi-deliberately introduce errors just as a means of gross simplification to make the thing readable to a general audience. It’s a good exercise as it reminds you that anything you read in a newspaper on a subject you’re less familiar with will also be a gross simplification of the subject with only partial accuracy.

    I’ll forgive that from generalist staff writers; when “science correspondents” have a very shaky/wrong grasp of even the level of science reached in A-levels – which is also frequent – well that’s less forgivable…

    1,176 posts

    @Rob, when we can’t rely on The Times for quality journalism and fact checking we may as well just give up.

    That’s a pretty shocking E&O list for just one article.

    Was considering paying for a Times sub, but if this is the quality, forget about it.

    Pretty much anything vaguely technical I read in the national press is full of errors. It’s just how it is. They’re all just different levels of clickbait these days.

    If you do want a sub, you can get it through Apple News for less. At least then you can compare different views on the same story.

    1,506 posts

    @Rob, when we can’t rely on The Times for quality journalism and fact checking we may as well just give up.

    That’s a pretty shocking E&O list for just one article.

    If you ever read a broadsheet news article designed for a general audience (all papers) about absolutely any subject where you are particularly specialised/knowledgeable then it’s laughable how poorly informed or miscomprehended most of what is written by generalist print journalists is. This is universal as general news journalists are writers paid to make a subject readable, not deep level experts. Even where you can tell they do know their stuff, explaining obscure nuances and qualifying statements doesn’t sell papers or make articles readable, so they will semi-deliberately introduce errors just as a means of gross simplification to make the thing readable to a general audience. It’s a good exercise as it reminds you that anything you read in a newspaper on a subject you’re less familiar with will also be a gross simplification of the subject with only partial accuracy.

    I’ll forgive that from generalist staff writers; when “science correspondents” have a very shaky/wrong grasp of even the level of science reached in A-levels – which is also frequent – well that’s less forgivable…

    This is so painfully true. I’ve had the misfortune in my previous job of giving the press office detailed clarifications when a journalist has been preparing a piece, only to then see a final article that failed to use the clarification provided. It’s particularly striking on morning radio where I happily listen along to the majority of topics, then am aghast and ready to write to the editor at any topic I know well.

    However, I agree with NorthernLass – long may the mischaracterisation of reward points continue.

    694 posts

    I can think of two glaring issues (IMHO) about the article:
    1. The thought of Avios being sold off as a brand/loyalty programme. I know the idea was rejected, but why would you think it in the first place?? As soon as you sell it, you’re no longer in control of it (nor its data)
    2. Using loyalty programmes for collecting customer data.. Sure if you’re sharing ALL your Avios data amongst your partners (not likely!). But otherwise your “partners” already have data about you, whether or not you’re collecting Avios.

    Or to put it another way. I have little interest in earning 20 Avios for an Uber ride. I DO have interest in paying £100s for an AMEX card and spending £50k/year on it to get a meaningful amount of Avios, 241s and other benefits. Would be interested how many Avios BA “sell” that they estimate will never be returned.

    As per the “Underpants Gnomes” business plan:
    1. Sell Avios
    2. ??????
    3. Profit!

    3,525 posts

    Whilst there is an element of avios being returned to IAG loyalty because of the expiry date BA has done a lot to help people redeem small amounts to reduce that rather then customers losing out completely.

    The ability to knock £30 of a short haul CE ticket for 3,000 avios will be useful to some. As is the recent expansion of that to BA Holidays,

    And of course even the transfer to nectar gets the customer some value from them.

    402 posts

    I can think of two glaring issues (IMHO) about the article:
    1. The thought of Avios being sold off as a brand/loyalty programme. I know the idea was rejected, but why would you think it in the first place?? As soon as you sell it, you’re no longer in control of it (nor its data)
    2. Using loyalty programmes for collecting customer data.. Sure if you’re sharing ALL your Avios data amongst your partners (not likely!). But otherwise your “partners” already have data about you, whether or not you’re collecting Avios.

    Or to put it another way. I have little interest in earning 20 Avios for an Uber ride. I DO have interest in paying £100s for an AMEX card and spending £50k/year on it to get a meaningful amount of Avios, 241s and other benefits. Would be interested how many Avios BA “sell” that they estimate will never be returned.

    As per the “Underpants Gnomes” business plan:
    1. Sell Avios
    2. ??????
    3. Profit!

    The bit I always find fascinating to think about is how much interest Avios earn on the money sat in there bank account waiting to be redeemed!

    721 posts

    I can think of two glaring issues (IMHO) about the article:
    1. The thought of Avios being sold off as a brand/loyalty programme. I know the idea was rejected, but why would you think it in the first place?? As soon as you sell it, you’re no longer in control of it (nor its data)
    As per the “Underpants Gnomes” business plan:
    1. Sell Avios
    2. ??????
    3. Profit!

    Isn’t it the Air Canada plan…

    1) Sell off loyalty scheme for $$$$.
    2) Ditch loyalty scheme ASAP (which will then implode as it’s now a worthless loyalty scheme without anything to be loyal to) and set up your own new one.
    3) Money acquired from (1) is now pure extra profit.

    Seemed to work for them…?

    https://www.headforpoints.com/2017/05/12/air-canada-dumps-aeroplan-aimia/

    HfP Staff
    2,867 posts

    Aeroplan is why its very unlikely that any other airline will ever be able to sell off its loyalty programme ever again.

    Even with a 20 year contract, investors aren’t going to bite.

    694 posts

    Aeroplan is why its very unlikely that any other airline will ever be able to sell off its loyalty programme ever again.

    The key term is loyalty. That’s not a one-way contract. Avios have taken the clever route – rather than sell it off, find new ways to monetise and leverage it.

    110 posts

    Has anyone actually got through to the archive.is link at the start of this article?
    It just hangs for me every time I try since the article first appeared.

    2,259 posts

    Yes, just tried it on 3 browsers and it worked fine.

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