5,000,000 FF points to be won - but the value? Something misleading about this...

[MEL_Traveller]

So got an email tonight - if you book an international flight with QF between 2 November and 7 November (I seem to have missed the original email) you go in to the draw to win 5m FF points.

The interesting thing from the terms and conditions is this...

One entry permitted per passenger per Eligible Booking. Prize: 1x 5,000,000 Qantas Frequent Flyer points. Maximum notional value approximately AU$94,605 based on a sample of Awards available through the Qantas Frequent Flyer program at 24/10/12.

i cannot understand on any basis how they have come up with a max value of $94,605? 5M FF points would buy 13 return first class tickets Australia to London. Even at a generous $10 per ticket (with their current promo), that comes to $130K. I suppose you take taxes out of that? Anyway - assuming you don't buy during the promo the value would be closer to $208000 (but take off taxes of approx $19000) - still way above their notional value. Something looks fishy. This is WAY too basic a mistake for it not to be intentional.

Mods - i did a quick search but didn't see a thread already on this - please merge if there is.

 

[oz_mark]

I worked it out as around 1.9c per point, which seemed not unreasonable to me. I guess it depends on what is in their sample.

The award shop would give less than one cent per point, and premium long haul gives you a better redemption rate. What are you suggesting the notional value should be?

 

[Kangol]

http://www.australianfrequentflyer....program/global-sale-what-would-you-44628.html

Note they used the term "maximum notional value" - I think that answers your question. The "value" of a QFF point is a topic that has been discussed here at length. You'll find that it varies considerably depending on earning/burning circumstances.

 

[MEL_Traveller]

I worked it out as around 1.9c per point, which seemed not unreasonable to me. I guess it depends on what is in their sample.

The award shop would give less than one cent per point, and premium long haul gives you a better redemption rate. What are you suggesting the notional value should be?

I would have thought it was the max value of the prize - which would be in the region of 13xF class return (less taxes, fees, charges, credit card fees, assistance fees etc etc), since they say it is based on a sample of awards.

I take Kangol's point - I guess it depends on their play on 'notional' - but then they go on to say it is on the sample of awards, so if you are going to do that, why not take the highest award?

 

[oz_mark]

I would have thought it was the max value of the prize - which would be in the region of 13xF class return (less taxes, fees, charges, credit card fees, assistance fees etc etc), since they say it is based on a sample of awards.

I take Kangol's point - I guess it depends on their play on 'notional' - but then they go on to say it is on the sample of awards, so if you are going to do that, why not take the highest award?

It's hard to know what they were based on, but I wouldn't have thought it was in their interests to understate the value.

 

[Kangol]

I would have thought it was the max value of the prize - which would be in the region of 13xF class return (less taxes, fees, charges, credit card fees, assistance fees etc etc), since they say it is based on a sample of awards.

I take Kangol's point - I guess it depends on their play on 'notional' - but then they go on to say it is on the sample of awards, so if you are going to do that, why not take the highest award?

It is the maximum value ... of their "sample" which is obviously not disclosed and carefully selected to underestimate the "value" as oz_mark has said.

In your example, you can get a one way FASA MEL or SYD to LHR for either ~240k or ~1.4 million points, all inclusive, which depends on booking class and availability. Note that they are exactly the same product, just priced differently. If a one way fare is 1.4 million points, you can't even get 2x F return trips with 5 million points in the bank. You can however get more than 2xF return trips with $94k in the bank

Again, it would be in QFF's best interests to underestimate the "maximum possible value". Depending on how you burn the points, you could legitimately "value" them at over $250k (for the equivalent product) depending on how creative your accounting is.

 

[MEL_Traveller]

It is the maximum value ... of their "sample" which is obviously not disclosed and carefully selected to underestimate the "value" as oz_mark has said.

In your example, you can get a one way FASA MEL or SYD to LHR for either ~240k or ~1.4 million points, all inclusive, which depends on booking class and availability. Note that they are exactly the same product, just priced differently. If a one way fare is 1.4 million points, you can't even get 2x F return trips with 5 million points in the bank. You can however get more than 2xF return trips with $94k in the bank

Again, it would be in QFF's best interests to underestimate the "maximum possible value". Depending on how you burn the points, you could legitimately "value" them at over $250k (for the equivalent product) depending on how creative your accounting is.

why pick an ASA? A return F is 384,000 points! that's 13 return tickets...

 

[Kangol]

why pick an ASA? A return F is 384,000 points! that's 13 return tickets...

A return F is not 384,000 points - it is 384,000 points + ~$900 and only if they are available to purchase.
I couldn't find a return classic F award in the brief search I just did (could only find one way availability, which was AUD $454.65) so my gross estimation for this example is ~double the one way cost.

Classic awards must be accompanied by a cash co-payment otherwise you can't get the award, so having points alone is of no value if you don't have the money to pay for the extra charges in the ticket.

I used an ASA as an example because:
1. It is the only type of award where you have the option of solely using points. You can't do that with a classic award.
2. To highlight the stark differences in points cost for the same product, thereby showing variability in the calculated "value".

Hope this clears things up for you and shows that it's not *misleading* - it has all to do with how the "owner" of the points spends them. In the same way some people can bargain hunt in shops in different ways than others, or invest/spend money in different ways than others - clearly showing the variability in the "value" of the currency at hand.

 

[dajop]

What's the value of 17 oneworld J awards, vs say 17 35,000 miles global explorer fares? At least $170K I'd guess.

 

[MEL_Traveller]

A return F is not 384,000 points - it is 384,000 points + ~$900 and only if they are available to purchase.
I couldn't find a return classic F award in the brief search I just did (could only find one way availability, which was AUD $454.65) so my gross estimation for this example is ~double the one way cost.

Classic awards must be accompanied by a cash co-payment otherwise you can't get the award, so having points alone is of no value if you don't have the money to pay for the extra charges in the ticket.

I used an ASA as an example because:
1. It is the only type of award where you have the option of solely using points. You can't do that with a classic award.
2. To highlight the stark differences in points cost for the same product, thereby showing variability in the calculated "value".

Hope this clears things up for you and shows that it's not *misleading* - it has all to do with how the "owner" of the points spends them. In the same way some people can bargain hunt in shops in different ways than others, or invest/spend money in different ways than others - clearly showing the variability in the "value" of the currency at hand.

ah! good point (scuse the pun!!) - that makes sense to only use something which can be completely redeemed with points and without cash co-pay (I understand now!)