FYI: Virgin Australia's Velocity Frequent Flyer CEO resigns

[DavidFlynn]

The boss of Virgin Australia’s booming loyalty business, Karl Schuster, has resigned after almost five years in the role.
Virgin boss Paul Scurrah said Mr Schuster had “helped set up the program for success in its next phase” and thanked him for his contribution to the company.
Mr Schuster said it had "been an honour to lead the Velocity team since 2015 and I am incredibly proud of everything the team has achieved during this time".
"This wasn’t an easy decision to make, however, the business is now in a place where I feel the time is right for me to step down as CEO," he said.

Virgin Australia's frequent flyer boss resigns

The boss of Virgin Australia’s booming loyalty business, Karl Schuster, has resigned after almost five years in the role.

www.smh.com.au

 

[knagelli]

Does this mean more changes to velocity in the coming days/months with new leadership team.

 

[odysseus]

That's sad, he was a cool guy.

 

[DavidFlynn]

Does this mean more changes to velocity in the coming days/months with new leadership team.

I'd not read that into this. There may well be some changes in the coming months, there's often something bubbling away, but I'd not rush to connect those dots.

 

[moa999]

I'd assume he would have got a pretty nice payout given the likely returns that the PE firm got.
Management bonuses are typically highly tied to the returns

 

[DavidFlynn]

If I recall, The Australian last year reported KS was in line for around $8.8m!

 

[ozstamps]

Fingers crossed they appoint from within. A new broom is not what we need I suspect.

Hopefully someone who has the brains to differentiate Platinum benefits from Gold again - right now they are near the same. Bring back ''Fly Ahead'' on all fares for Plats etc. .

For last few years hardly worth the bother for anyone to aspire to.

 

[dajop]

Fingers crossed they appoint from within. A new broom is not what we need I suspect.

Hopefully someone who has the brains to differentiate Platinum benefits from Gold again - right now they are near the same. Bring back ''Fly Ahead'' on all fares for Plats etc. .

For last few years hardly worth the bother for anyone to aspire to.

Are benefits (such as fly ahead) a “affinity program” (Velocity) issue or an airline (Virgin Australia) issue?

Whilst the cash generating side of a “loyalty” program (selling points and distributing awards) can run quite independently - the strategic side must be heavily linked with airline overall marketing strategy. Perhaps bringing the program back “in house” (100% owned once more) will help.

 

[ozstamps]

dajop - no idea who makes the call but top level of every airline program I have been in has REAL plusses for top tier over Gold etc.

The new chief might do well to take a good look at WHAT goodies his highest level fliers get. No-one aspires to a mediocre top level. The Hilton Diamond card you get as a new Platinum Velocity is a FAR better deal than anything Virgin offers to Plats (IMHO) which is absurd really! And all who have experienced what Hilton offers their top Tier over Gold, realises it is chalk and cheese.

We travelled across India this month and were treated like Maharajas in all Hiltons we stayed in. Large Suites allocated on very cheapest room type booked etc - $A100 rooms etc. And Virgin near refuse to upgrade ANY Plat as a benefit, even if space is clearly going to be available at fly empty. They could learn a LOT from their partner Hilton. ☑

In Velocity - there are virtually no Bennies on Virgin of any real note. A few upgrades useable on insane priced full fares - what a fizzer. You can often BUY paid Biz for LESS than Freedom fares on many routes! There is no major distinction right now between Gold and Platinum seeing one tier flies twice as much minimum to qualify, as the other.

All Plats should get a few upgrade e-Certs a year to use on ANY domestic route they book, subject to X or whatever inventory bucket being there when requested. Airline is still in charge, but at least a real benefit to dangle aspirationally to non-Plats = MONEY. Book a SYD-ADL mid afternoon, and BINGO you are upgraded 2 or 4 times a year etc. Worth hanging out for, and a cinch to do operationally if coded into system.

Been YEARS since we as Plats have been offered an op-upgrade at check-in. 4 or 5 years back they were pretty common, on lightly booked biz cabins.

Even if they offered to "sell" upgrades on day of travel for a reduced (50%) miles total, or reduced the $ total - that creates revenue, and makes Plat a real edge to aspire to. .

 

[TripleB]

Presumably with private equity in the mix, he was incentivised with some sweet equity. If the sale price when Virgin bought the PE holding out was such that the sweet equity was in the money then he may have become very wealthy. Yes I'm sure that Virgin incentivised him in some way - but after a PE exit to a trade buyer (which is kind of what this was) it can often be hard to retain management who now have many millions sitting in the bank and families they haven't seen for years...

 

[sudoer]

no idea who makes the call but top level of every airline program I have been in has REAL plusses for top tier over Gold etc.

Maybe go read the P1 experiences vs WP in the Qantas forum.. they'd beg to differ.

 

[henrus]

The Hilton Diamond card you get as a new Platinum Velocity is a FAR better deal than anything Virgin offers to Plats (IMHO) which is absurd really!

No longer Platinum, but when I was VA Plat I did activate the Hilton Diamond card but instead of receiving Hilton Diamond status I just got Gold. Tried following up but no one really understood the problem so I just gave up.

 

[Must...Fly!]

I'd just be happy to retain the status quo. Virgin will have to pay off that money they have borrowed to fund the re-purchase of Velocity in one way or another.

However that said it is much better in their hands than private equity. They can really leverage the program against the airline now, and focus very closely on how to drive loyalty and $ to the airline with the incentive of the loyalty program. Nothing is sure, but I don't think we will see much in the way of devaluations over the coming year. Hopefully not, anyway

 

[33kft]

Maybe go read the P1 experiences vs WP in the Qantas forum.. they'd beg to differ.

What would those people be getting if they flew VA, though? They have few options for a "more platinum than platinum" tier of recognition, regardless of how far differentiated it is from platinum. The poster you replied to was talking about the delta between Platinum to Gold, not Platinum to a tier that doesn't exist.

 

[sudoer]

What would those people be getting if they flew VA, though?

I'm not suggesting that P1 is comparable to any status level at VA. I'm suggesting VA doesn't run the only program with a lacking top tier.

 

[amaroo]

Maybe go read the P1 experiences vs WP in the Qantas forum.. they'd beg to differ.

IME that thread is totally conflicted.

 

[33kft]

I'm not suggesting that P1 is comparable to any status level at VA. I'm suggesting VA doesn't run the only program with a lacking top tier.

That's pretty disingenuous. P1 doesn't equate to Platinum because they are both top tier. In fact, it's not even top tier really, Chairman's Lounge is. It certainly shouldn't be an argument for other programs lacking differentiation between Gold and Platinum tiers imho. That said, some programs don't have tiers beyond Gold so perhaps the whole thing is academic.

 

[sudoer]

P1 doesn't equate to Platinum because they are both top tier.

P1 is top tier with QF and WP is top tier with VA - but I'm not comparing the two. I am simply saying they are both top tier status levels with their respective airlines.

It certainly shouldn't be an argument for other programs lacking differentiation between Gold and Platinum tiers imho. That said, some programs don't have tiers beyond Gold so perhaps the whole thing is academic.

It's not an argument. I am just pointing out that in Australia's frequent flyer program near-duopoly, both programs are guilty of not having a huge improvement on benefits between top tier and the tier below it - but it sounds like we won't come to an agreement because we disagree on the definition of top tier.

In fact, it's not even top tier really, Chairman's Lounge is.

Now who's being disingenuous?

 

[juddles]

That's pretty disingenuous. P1 doesn't equate to Platinum because they are both top tier. In fact, it's not even top tier really, Chairman's Lounge is.

Sorry 33kft, but I am unsure you actually understand the P1 and CL tiers within Qantas. P1 is the Qantas absolute top tier in frequent flying metrics. The CL program is a completely different kettle of fish - it is about Qantas granting some super nice privileges to people of intense economic or political interest to them - even if the person does not fly Qantas. The CL Qantas thingy is NOT, in any shape or form, a frequent flyer earned status concept. It is a completely separate program where specific benefits and "club" membership are granted by Qantas.

In any case, I understand that in both the Qantas and Virgin realms, people with high status wish to see greater differentiation between what they have fought to attain, and the rung below them. As per amaroo's comment, Qantas P1's often do not see enough of such difference from humble QF Platinums.

What i have always held is that some certain, clear, valuable perks of a higher status should be included in any program - the best example (as done by many airlines around the world) is such simple things as a couple of guaranteed upgrades per year, etc.

It is in this simple stuff that I feel almost all airlines are failing at...

 

[amaroo]

FWIW, I’m a P1 - I’m in no doubt CL is the top tier .