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One of the aspects of the recent British Airways PR Day that hasn’t received much attention yet, are the comments that BA CEO and Chairman, Alex Cruz, made about the future of Avios and British Airways Executive Club. This is surprising, as although what he said was relatively brief, it was certainly worth noting.
What’s not changing
Perhaps the biggest news was actually the confirmation of what isn’t changing.
Cruz made clear that there are currently no plans for any changes to the redemption prices for Avios award flights. When asked, he replied “no, at this moment I’m not aware of any changes”. For those of us who are pretty sick of the devaluations over recent years, this is obviously good news.
Cruz also indicated that the existing earning rates for both Avios and elite status are also unlikely to change. He stated that British Airways is “not so much (looking) into changing rules around Tiers and such“, though he did add “who knows how that will develop, I always have to add a disclaimer!“.
Taking all of the wider comments into account too, my take is that while these sorts of of things are technically always subject to review, there is no appetite at the moment for further changes and it is certainly not a priority right now. I would anticipate a period of relative peace on that front (famous last words…).
The future of Avios and British Airways Executive Club
What is changing has more to do with what the long-term vision for Avios is.
As regards British Airways Executive Club, the aim is to make it easier to use and something that provides value to more passengers. I think the ability to redeem small amounts of Avios onboard for food and drink (and possibly for internet access in future), as well as the Avios + cash redemption options, are probably just the start of that.
Cruz said, “most of the changes we are considering for Executive Club are to make (it)… more user friendly, more adoptable by different types of passengers“.
Redeeming for flights can seem complicated if you’ve never done it before and obviously you need a decent amount of Avios stored up too, so cheaper and easier redemption options (perhaps using Avios to pay for seat assignments, extra bags etc) are probably what we are going to see more of. Whether the new options will provide good value at all is a very different question!
It has been clear for a while now that the plan for Avios is ultimately to be much more than just a standard frequent flyer currency. We’ve already seen that begin to happen with the ability to earn Avios from all sorts of activities and retailers that have nothing to do with BA or flying at all, primarily through the Avios.com platform.
According to Cruz, that trend is very much set to continue,“We think that the way that Avios is developing…is going to create a completely different tool of trading and engaging with consumers across the UK and Europe – and the United States. The fact that today you can buy products in Waitrose, in John Lewis… and actually earn Avios, it’s amazing”.
An expansion of the number of in-store Avios earning opportunities looks like it’s going to be the key focus:
“You can get your coffee in Cafe Nero, you don’t need to show any cards or anything, you just have to pay with your normal credit card – you will get Avios right there and then. As we spread this throughout the rest of the brands, particularly in the UK, we believe that the amount of attachment and loyalty and flexibility this will give us to continue developing Avios is tremendous.
Right now the focus is on how can we make Avios the, THE(!), loyalty system in the UK”.
Bottom line
As regards the award chart and elite status, the current plan for Avios and British Airways Executive Club seems to be to keep things pretty steady and avoid anything dramatic.
The real focus at the moment is on continuing to turn Avios from a frequent flyer programme into a national (and international) loyalty giant, covering as much of the retail and service landscape as possible.
The more ways there are to earn Avios, the better, as far as I am concerned!
What do you make of Alex Cruz’s comments?
I do dread the day when the executive club becomes Avios points and we have to all use the same website.
Yes that’s likely going to be a very bad day indeed!
What’s strange is that I seem to remember that the IAG investment presentation made out that the change was going to happen pretty soon (this year?), but there was no indication at all of anything imminent from Alex Cruz this week. Maybe moving to one system is harder than they thought – I believe there were issues with AerCLub which is why it took so long, and that was relatively very simple. With a bit of luck, perhaps IT challenges might mean we get to keep the different platforms for a while still!
Will be a sad day when we cannot use ib separately.
I’m not convinced that it will ever happen. The Spanish market is different from the British one (essentially London actually so even wealthier), so charging BA-level amounts of Avios and surcharges for IB rewards doesn’t do anything except demotivate Spanish frequent flyers and get rid of some travel hackers. It will also surely be a nightmare to merge a bunch of country-specific ground partners into one single programme. And will Brexit have an impact? Lots of posturing re. Gibraltar…
For what? Where’s the upside for IAG? To devalue IB+? That can be done at any time…