Author Topic: AS devaluation of EK redemptions  (Read 13244 times)

Offline Aaaron

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Re: AS devaluation of EK redemptions
« Reply #30 on: March 31, 2016, 10:06:13 AM »
Reports that they're not allowing any changes to existing ressies either.  Shame, because I have JFK-MXB-DXB-DOH booked and I was waiting for availability on the JFK-DXB direct leg.

Offline benjie1305

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Re: AS devaluation of EK redemptions
« Reply #31 on: March 31, 2016, 10:06:44 AM »
What's the current status of YQ when using KE or JL miles for EK?

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Offline Dan

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Re: AS devaluation of EK redemptions
« Reply #32 on: March 31, 2016, 10:07:52 AM »
And KE doesn't either, correct?
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Offline AJK

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Re: AS devaluation of EK redemptions
« Reply #33 on: March 31, 2016, 10:08:45 AM »
... As if someone booked EK with KE miles. Lol.
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Offline EJB

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Re: AS devaluation of EK redemptions
« Reply #34 on: March 31, 2016, 10:11:19 AM »
... Except that the pennies they save devaluing without notice pales in comparison the value lost as a result of pissing off some of your most valuable flyers, not to mention the thousands of people who bought miles over the last few days in order to redeem for EK F.

If it were a systemwide devaluation without notice, I'd agree with you, but I don't think this targeted their most valuable flyers. I think it targeted churners.

IMO your last point is a good one. I think people will think twice before purchasing AS miles in the future. AS should offer these people a refund option, but the chances of that happening are slim to none. I honestly think this may have been an oversight by AS.

Offline EJB

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Re: AS devaluation of EK redemptions
« Reply #35 on: March 31, 2016, 10:12:26 AM »
... As if someone booked EK with KE miles. Lol.

Possibly for their award holds (assuming they allow on EK flights).

Offline AJK

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Re: AS devaluation of EK redemptions
« Reply #36 on: March 31, 2016, 10:13:03 AM »
No.
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Offline AJK

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Re: AS devaluation of EK redemptions
« Reply #37 on: March 31, 2016, 10:15:17 AM »
If it were a systemwide devaluation without notice, I'd agree with you, but I don't think this targeted their most valuable flyers. I think it targeted churners.

IMO your last point is a good one. I think people will think twice before purchasing AS miles in the future. AS should offer these people a refund option, but the chances of that happening are slim to none. I honestly think this may have been an oversight by AS.

Just because it wasn't a *system wide* devaluation doesn't mean it wasn't a punch in the stomach to people who fly AS 100K+ per year BIS. I fail to see the correlation or on what basis you have to conclude that those people weren't also saving up to fly EK F. Instead of one year if flying, it now takes two.
2015: 116K bkd | 1.6M brnd | F: OZ,NH,AA,EK | J: UA,CA,TK,DL,TN,AF,VA | LIH,NRT,ROR,PEK,CNS,BOB,MEL,TLV & Pacific Hopper

Offline EJB

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Re: AS devaluation of EK redemptions
« Reply #38 on: March 31, 2016, 10:20:09 AM »
Just because it wasn't a *system wide* devaluation doesn't mean it wasn't a punch in the stomach to people who fly AS 100K+ per year BIS. I fail to see the correlation or on what basis you have to conclude that those people weren't also saving up to fly EK F. Instead of one year if flying, it now takes two.

Obviously it'll be a punch in those people's stomachs as well, but I don't think that many of them were saving up to fly EK F compared to how many of the churners were saving up for that redemption. I flew 75k last year on (credited to) AS, and this impacts me significantly, but I think many heavy business travelers are unaware of the EK redemption option altogether. I think removing AA or DL as a redemption partner without notice would impact the typical business traveler more significantly, while that would have less of an impact on us.

Offline AJK

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Re: AS devaluation of EK redemptions
« Reply #39 on: March 31, 2016, 10:23:51 AM »
Wait, you're suggesting it will impact the BIS flyers *less?*

So I earned 1MM+ AS miles in about a half hour in 2015, and they earned 100K in about a year,  and now they'll have fly for *another year*, and it impacts them less?

Just because there are fewer MVPs than churners doesn't mean the effects are less. In point of fact, they are more, as that's where the actual business comes from. (Not to mention even pissing off churners and mileage buyers affects the bottom line as well.)
2015: 116K bkd | 1.6M brnd | F: OZ,NH,AA,EK | J: UA,CA,TK,DL,TN,AF,VA | LIH,NRT,ROR,PEK,CNS,BOB,MEL,TLV & Pacific Hopper

Offline benjie1305

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Re: AS devaluation of EK redemptions
« Reply #40 on: March 31, 2016, 10:26:31 AM »
Until CX devalues, people will still churn and buy miles in the AS program as there is still tremendous value to be had and the best way to Asia2 for now.

But I have a strange feeling that that will change soon..
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Offline AJK

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Re: AS devaluation of EK redemptions
« Reply #41 on: March 31, 2016, 10:27:35 AM »
Until CX devalues, people will still churn and buy miles in the AS program as there is still tremendous value to be had and the best way to Asia2 for now.

But I have a strange feeling that that will change soon..
Uhm, as of today, you'd have to be a blithering idiot to spend thousands on AS miles without being able to ticket while on the same phone call.
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Offline EJB

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Re: AS devaluation of EK redemptions
« Reply #42 on: March 31, 2016, 10:35:02 AM »
Wait, you're suggesting it will impact the BIS flyers *less?*

So I earned 1MM+ AS miles in about a half hour in 2015, and they earned 100K in about a year,  and now they'll have fly for *another year*, and it impacts them less?

Just because there are fewer MVPs than churners doesn't mean the effects are less. In point of fact, they are more, as that's where the actual business comes from. (Not to mention even pissing off churners and mileage buyers affects the bottom line as well.)

Again, it'll impact those that are saving for this particular redemption the same, but I don't think as many of them (both in # and %) are saving for this particular redemption.

Re: Bottom line impact - You're assuming this particular type of redemption at the old rates was profitable for AS from churners and mileage buyers. I'm not convinced it was, especially from churners. And, if you really want to talk about bottom line impact, AS can recognize the expected decrease to their mileage liability as income almost immediately, and doesn't need to do much work to justify what they select as the expected impact caused by alienating members (which I would hope they explicitly incorporate in their projection model).

I agree with your point about how this can alienate mileage buyers, but frankly I'm not convinced AS cares about alienating churners.

Offline benjie1305

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Re: AS devaluation of EK redemptions
« Reply #43 on: March 31, 2016, 10:49:14 AM »
Uhm, as of today, you'd have to be a blithering idiot to spend thousands on AS miles without being able to ticket while on the same phone call.

True, no notice is not fun.

I was merely commenting on churners still seeing value in going for AS cards. For that TU pull I am happy taking on that risk (even if it just came to bite me a bit).
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Offline AJK

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Re: AS devaluation of EK redemptions
« Reply #44 on: March 31, 2016, 10:49:35 AM »
Again, it'll impact those that are saving for this particular redemption the same, but I don't think as many of them (both in # and %) are saving for this particular redemption.

Re: Bottom line impact - You're assuming this particular type of redemption at the old rates was profitable for AS from churners and mileage buyers. I'm not convinced it was, especially from churners. And, if you really want to talk about bottom line impact, AS can recognize the expected decrease to their mileage liability as income almost immediately, and doesn't need to do much work to justify what they select as the expected impact caused by alienating members (which I would hope they explicitly incorporate in their projection model).

I agree with your point about how this can alienate mileage buyers, but frankly I'm not convinced AS cares about alienating churners.

You accountants/consultants/advisors love to quantify things, but I'm afraid the backlash to a no-notice devaluation, system wide or not, to one of the-if not the--most aspirational awards on your chart can't be quantified at this point. While theoretically possible to insulate the MVPs from the deval, that's not what AS chose to do, and are, in effect, throwing out the baby with the bathwater--regardless of whether they can "recognize the expected decrease to their mileage liability as income almost immediately."

The point is, devaluations are something that, given the climate, are required by economics.  However, programs can go a long way to avoid pissing off their MVPs by giving notice ahead of time.  Not to mention the possible legal questions posed by what appears to be a rudimentary bait and switch for those who purchased miles.
2015: 116K bkd | 1.6M brnd | F: OZ,NH,AA,EK | J: UA,CA,TK,DL,TN,AF,VA | LIH,NRT,ROR,PEK,CNS,BOB,MEL,TLV & Pacific Hopper