AFF Point Valuations

[CaptJCool]

I think point valuations are to give you an idea of the *minimum* value you should be getting. If Qantas points are valued at 1.6c each, you shouldn’t be redeeming them for less.

That would be the cost of the toaster divided by the points they want.

If you are getting more than 1.6c per point, you’re on the right track. In many cases you can get far more than the valuation… maybe 3-9 cents per point (for example a business class redemption depending on the route).

That was the pointy of the FF Programs
To find ways to acquire points for free (or next to nothing) eg creditcard sign on bonuses.
And then To find ways to fly for free or at the lowest cost one could find

That’s why the co-payments for premium J or F dilute this equation
If the cheapest QF F fare from Sydney to LHR return is A$13,999 then what’s the savings gained by booking through various programs (eg QF AA IB or nah of the other One World programs)

 

[burmans]

I think point valuations are to give you an idea of the *minimum* value you should be getting. If Qantas points are valued at 1.6c each, you shouldn’t be redeeming them for less.

That would be the cost of the toaster divided by the points they want.

If you are getting more than 1.6c per point, you’re on the right track. In many cases you can get far more than the valuation… maybe 3-9 cents per point (for example a business class redemption depending on the route).

This is only true IMO if you value a redemption at the exorbitant price the airline quotes. I for one don’t and indeed was the main reason I joined this forum, that’s the only way I’ll get flights at a price I’m prepared to pay. And that to me is the only way to value points, what you’d be prepared to pay in cash!

 

[MEL_Traveller]

That was the pointy of the FF Programs
To find ways to acquire points for free (or next to nothing) eg creditcard sign on bonuses.
And then To find ways to fly for free or at the lowest cost one could find

That’s why the co-payments for premium J or F dilute this equation
If the cheapest QF F fare from Sydney to LHR return is A$13,999 then what’s the savings gained by booking through various programs (eg QF AA IB or nah of the other One World programs)

But there are ways around the program being diluted by fees and surcharges.

For example when I was commuting on VA (business class) I used the points to redeem future flights (also in business).

The thousands of dollars saved went to buying aeroplan points. Aeroplan has no fuel surcharges (except on EK). Travelled farther and cheaper than if I’d used the points directly through Velocity to fly anywhere. Same applies to QF.

 

[MEL_Traveller]

This is only true IMO if you value a redemption at the exorbitant price the airline quotes. I for one don’t and indeed was the main reason I joined this forum, that’s the only way I’ll get flights at a price I’m prepared to pay. And that to me is the only way to value points, what you’d be prepared to pay in cash!

I actually agree with this (and don’t necessarily agree with points valuations on the various blogs).

Redeeming through Aeroplan the cost of a return business class to Europe is ~AUD4200, plus actual government and air0rt taxes (maybe $300).

So the most I value a redemption to Europe on Qantas or anyone else is $4500.

That’s still works out to a value of QF points of about 1.5c by the time you account for the number of points plus co-pay.

 

[karlg]

That’s still works out to a value of QF points of about 1.5c by the time you account for the number of points plus co-pay.

.. and there's the rub if I earn most of my points from buying things on the credit card, and the merchants charge 1.5% for the privilege.. and am losing money using Amex..
.. and this excludes the yearly 'membership' fees
.. and this will only get worse when CC companies are forced to reduce their profit taking..

 

[Rayesfeg]

An interesting point in the T&Cs for the current Qantas marketplace promo (win 1million points) shows the methodology that Qantas used to calculate the value of their points:

Clause 14 of the T&Cs sets out that: "Each prize is one million (1,000,000) Qantas Points. The maximum notional value of each prize is $53,817".
With those figures in mind, we can work out that Qantas calculate the value of their points, for this promotion, at 5.3817 cents per point. Quite a difference to the AFF valuations - though this methodology is a lot more simple than that of the AFF Valuation. Just something that I thought would be worth sharing.

Here are the full T&C's which show how they got to this figure:

 

[flyguy77]

So in other words they hand-picked a ridiculously expensive one-way flight to make the points look much more valuable than they are.

 

[MEL_Traveller]

So in other words they hand-picked a ridiculously expensive one-way flight to make the points look much more valuable than they are.

that’s the maximum notional value.

years ago they used to value points without the ‘maximum’. And the points were something like .7c, or was it .6c?

maybe it’s some sort of regulatory thing where they have to value the prize at its maximum?

 

[burmans]

that’s the maximum notional value.

years ago they used to value points without the ‘maximum’. And the points were something like .7c, or was it .6c?

maybe it’s some sort of regulatory thing where they have to value the prize at its maximum?

Or just good marketing!

 

[GrahamBRI]

An interesting point in the T&Cs for the current Qantas marketplace promo (win 1million points) shows the methodology that Qantas used to calculate the value of their points:

Clause 14 of the T&Cs sets out that: "Each prize is one million (1,000,000) Qantas Points. The maximum notional value of each prize is $53,817".
With those figures in mind, we can work out that Qantas calculate the value of their points, for this promotion, at 5.3817 cents per point. Quite a difference to the AFF valuations - though this methodology is a lot more simple than that of the AFF Valuation. Just something that I thought would be worth sharing.

Here are the full T&C's which show how they got to this figure:
View attachment 502027

Not a very helpful calculation for many of us that like to keep the maths simple. They would have been better off using the Dualit NewGen 4 slice toaster as their example of a typical reward. This toaster is valued at 115,800 points which means you can buy 8.63 toasters with 1M points. As each toaster has a cash value of $579, the value of 1,000,000 points works out to be exactly $5,000 - a much easier number we can all use to do our maths on for the value of a point