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Should Virgin rethink miles allocations?

Posted:
04 Apr 2007, 09:42
by jimbob247
We just travelled LHR-SFO and LAS-LGW in economy (upgrading with miles) and netted just over 10,000 miles each. I think the fare was just over £600 each, bit more maybe.
Next week I am flying LHR-JFK-MIA-LHR in upper, fullly flexible at just over £4,400, I think it gets me just over 15,000 miles.
I guess most people are happy but it doesn't seem to reward those spending the most.
Is that right?

Posted:
04 Apr 2007, 10:23
by preiffer
Umm - ONE thing to consider is the little factor of distance

LHR-SFO in Upper, return, would net over 21k miles (plus any gold/silver benefit). You're not really comparing apples with apples here.
Forgetting "N" fares, here's the differences:
First trip in Economy (non N) = 10582
First trip in Upper = 21164
Second trip in Economy (non N) = 7888
Second trip in Upper = 15776
Also, bear in mind if you'd booked the CHEAPEST economy ticket, those trips would be 5291 and 3944 respectively. I don't think their calculations are that out


Posted:
04 Apr 2007, 10:35
by jimbob247
Ok very valid point, but on second trip, the cost is over seven times as much, the mileage only double.

Posted:
04 Apr 2007, 10:53
by fozzyo
The mileage is an equal benefit to all travellers (with the N class exception). You can earn those miles for a lot less money, what you are paying for is the flexibility. Miles are a reward for miles travelled, not cost of ticket - financial rewards only come from partners and credit cards, but travel is always the cheapest way of building mileage.
Mat

Posted:
04 Apr 2007, 10:57
by jimbob247
Some (but not many) airlines awards are much more closly linked to the price of the ticket though...

Posted:
04 Apr 2007, 11:01
by Decker
Yes but you're not paying for the mileage, you're paying for the flexibility. In some respects it could be argued that customers who DON'T book fully flexible tickets are more valuable as you can be fairly confident they won't be a no show on the day. The only reason to book a flexible ticket is to allow you the possibility of changing the booking. That effectively prevents them from selling that seat to anyone else even though you might not use it,

Posted:
04 Apr 2007, 11:14
by jimbob247
But at double the cost, it would be a good incentive, to add a 'flexibility bonus' as well as a 'cabin bonus'. Especially to business travellers who book full J class, but could just as well book less flexible tickets.
Just playing devils advocate...

Posted:
04 Apr 2007, 11:29
by Decker
and with a similar advocacy...
If I were a shareholder in any business that COULD book less flexible tickets and didn't I'd want to know why. If it is company policy to do this then why reward the person who actually undertakes the journey at all? They have no influence on the result. And if they do have influence on the result and choose this option they are in dereliction of their duties to the shareholders and should face disciplinary action.
Finally again, the reason flexible tickets are charged more for is because they cost more to the airline. All you have to do is change the booking once and you've halved the price of the ticket.

Posted:
04 Apr 2007, 11:44
by jimbob247
I would be interested in an analysis on breakage of fully flexible tickets, I think I change less than 1 in 10 flights. Though most are within Europe.
Virgin wouldn't offer the Chauffeur service if they didn't make more money.

Posted:
04 Apr 2007, 11:49
by Decker
So why not book fixed tickets and buy a new one the one in ten times you need one? Personally I believe a lot of companies waste money on fully flexible tickets. Having said that one major company I'm familiar with courtesy of friendships on this board pays less for Js than I pay for Zs. Under those circumstances why not

.

Posted:
04 Apr 2007, 11:53
by jimbob247
Mostly as I go short notice and the restricted tickets are sold out by then...

Posted:
04 Apr 2007, 11:55
by preiffer
R is for Route-deal...


Posted:
04 Apr 2007, 12:01
by Decker
OK so back at the point... if the company is paying the extra why reward the traveller?

(Indeed it is

)

Posted:
04 Apr 2007, 12:02
by FamilyMan
Just to add another factor to this debate:
The earning factor is identical to the spending factor. So yes you only earn 2*Y miles for UC but an UC fare is only 2*Y (present promotions excepted).
Any multiplication of earning for UC would have to be matched by similar multiplication for spending with the result that earning in Y and spending in UC would be much more difficult and earning in UC and spending in Y would be easier.
Incidentally fully flexible is not just about the ability to cancel. I almost always travel on a W ticket because I cannot satisfy the Saturday night stay (or often the 3 weeks lead time) on buying a K.
Phil FM

Posted:
04 Apr 2007, 12:20
by jimbob247
You lost me.
Flights LHR-JFK-LHR next month:
Y - £870, 6,916 miles
W - £1,662, 10,374 miles
J - £4,604, 13,832 miles

Posted:
04 Apr 2007, 12:41
by RichardMannion
You'd be surprised at how few people that travel in Upper actually care about the miles or are not members of Flying Club.
I earn 250% of mileage flown for Upper trips. Yes my fare is probably 5 times an economy fare that I would earn 150% for, but I'm not going to lose sleep over it. The mileage earning is an 'extra', in reality I am paying for the flight so I can get from A-B in comfort.
Virgin do what they have to, and will from time to time offer incentives to those that are travelling on J or D bookings (triple miles, John lewis Vouchers, free flights etc). But if there is ssufficient demand already for a cabin or flight, why spend more money on it as the miles aren't exactly free to Virgin. There is a cost liability associated with them.
Thanks,
Richard

Posted:
04 Apr 2007, 13:21
by Howard Long
Originally posted by jimbob247
I guess most people are happy but it doesn't seem to reward those spending the most.
FWIW on BA they are very tight on tier points and miles on restricted Y tickets.
Perhaps I am the exception rather than the rule, but my first FF program was on Delta fifteen years ago. In those early days I flew Y all the time. I could never justify spending all that extra on a premium seat. Then one day I made up enough points to get an upgrade. After that one taste of the forbidden fruit (and one particular flight where I was stuck next to a bible basher in the middle seat of five on an MD-11), I have never since flown Y longhaul.
In those days, if you played the system, you could travel in BC all the time on upgraded restricted Y fares as long as (a) you made five return transcon trips each year to make gold status and the miles and (b) you were flexible enough in your schedules. It was hard work, but you could make up enough miles, status credits and vouchers to sustain the habit.
The rules have changed since then, but my preference in the pointy end hasn't! So in the end, despite my earlier freeloading, they got the money out of me anyway. I have more miles than I have time to use up these days - I like to think of them as a rainy day investment. It's always nice when you find yourself at a loose end for the weekend on a Friday, and to be able to simply book yourself on a flight for next to nothing [y]
My point is that had those miles perhaps not been so generous on those early Delta flights, I might never have ended up investing in the comfort of premium longhaul travel.
Cheers, Howard

Posted:
04 Apr 2007, 13:34
by jaguarpig
FWIW on BA they are very tight on tier points and miles on restricted Y tickets.
ie: you get bugger all TPs and very few miles on anything but full fare Y, but any WT+ fare (even real cheapy sale) earn quite well.


Posted:
04 Apr 2007, 13:37
by Scrooge
Originally posted by fozzyo
but travel is always the cheapest way of building mileage.
Mat
Sorry I have to kind of disagree with you on that one Matt.
The cheapest way to build mileage with VS is car rentals.
Just an example A flight from LAX -LHR -LAX will cost $822.67 and earn you 5,442 miles
For $822 you could book 27 car rentals earning you 27000 miles.
In the end the mileage I get on flights is just an extra for me, I fly because I have to get somewhere, any reward I get from taking that flight is a nice bonus.

Posted:
04 Apr 2007, 14:58
by fozzyo
Ooh good example - I stand corrected.

)

Posted:
04 Apr 2007, 15:12
by McCoy
Indeed.. I had no idea car rental could be so lucrative!

Posted:
04 Apr 2007, 15:32
by jaguarpig
The recent Marriott bonanza was quite a cheap way of buying BA miles,$1250 for 112,000/84,000 BA miles depending on your Tesco transfer rate.

Posted:
04 Apr 2007, 21:38
by slinky09
But Jimbob surely has a point if you take the view that reward should be proportional to spend ... so let's cut him a little slack here?
As it is, we know that's not the case (and please show me any airline that makes it so relative), but doesn't mean the PoV is wrong ...

Posted:
05 Apr 2007, 10:35
by jimbob247
Aurigny is directly linked to spend... I know its hardly BA but still...

Posted:
06 Apr 2007, 08:01
by mike-smashing
Well, if anyone wants a scheme where rewards and status are proportional to spend, then I hear BA has an excellent system, and suggest that they punt their business in that direction.
Since the recent re-adjustement (last year) of premium and cabin bonuses, I think that VS run a reasonable FF scheme. Not quite as wantonly generous as some of the US carrier schemes, but acceptable nonetheless.
Mike