National carrier South African Airways has announced a few significant changes to its SAA Voyager program in order to position it as the frequent flyer program of choice on the African continent. SAA announced the Re5 campaign at a launch held in Johannesburg on Friday.
The changes, aimed at getting frequent flyers to reconsider South African Airways as its preferred partner, are in line with the airline’s Long-Term Turnaround Strategy (LTTS) and aims to ensure about a quarter of the airline’s passenger market.
In terms of the Strategy, our key deliverable for the Voyager program are non-negotiable. Immediate interventions were required to improve our customer value proposition to ensure customer retention in the highly competitive domestic, regional and international market.
said Nico Bezuidenhout, SAA Acting Chief Executive
The program changes which, for the most part, will come into effect on 1 February 2015, have simplified the existing program, dramatically taking into consideration issues members had with how miles were awarded, implemented and communicated.
Our members have spoken, experts and analysts have commented, and we have listened.
said Suretha Cruse, SAA Executive Customer Loyalty at the launch event of the Re5 campaign
The Re5 campaign is anchored on five key program changes but the most significant benefit change is the new way in which miles are earned.
Re5 is now offering Voyager members a 5% percent return, including the fuel surcharge which previously had to be paid separately by the member.
This means a mile is earned in return for every R1.60 spent or to put it into context – R250 worth of miles are awarded for every R5 000 spent.
Cruse explained that while other rewards programs highlight what is known as “a marketing percentage, sometimes as high as 10% – when drilled down to the actual rand valued a very different picture is attained, even as low as 1%” .
Previously, a SAA passenger who was travelling to a regional destination would earn the same miles as a person who was travelling a domestic route with a similar distance – yet the prices would be considerably different Cruse said.
Re5 now aims to cement a better African footprint for the airline with a rewards system that is more balanced and fair.
When asked if existing members would be losing out in the roll-out process, Cruse confirmed the airline simulated the new awards process on last year’s revenue, which showed a 1 percent drop in the amount of miles given overall.
A nominal saving for the airline in the short term but nothing compared to the 20% increase members will have going forward, considering the fuel levy previously charged had now been absorbed.
While members would still have a window period of 48hrs before ticket bookings were confirmed, the program aims to implement part payment of miles and cash in 2015 which allow members to secure tickets immediately. Cruse said members will be informed as soon as the technology supporting this feature was in place.
So what can existing and new members look forward to once all the changes come into effect in between January and February 2015?
1. All SAA Voyager members world-wide will earn Miles for travel on flights operated by SAA, based on the ticket price (base fare and fuel levy) rather than the distance travelled. Under the new SAA exclusive earning structure, all members will receive 1 SAA Voyager Mile per ZAR 1.60 spent and the accumulation of Miles under this earning structure, will count towards Tier status. Silver, Gold, Platinum and Lifetime Platinum members will earn additional miles based on their status on the day of departure. SAA will furthermore no longer restrict its SAA Voyager members to a minimum or maximum amount of miles when travelling on flights operated by SAA.
2. All SAA Voyager members world-wide will be able to spend their Miles for any available seat for travel on flights operated by SAA.
3. The redemption of Miles under this new structure will be applicable to the base fare and fuel levy of a member’s requested flight(s), referred to as an SAA exclusive Dynamic Award. During the initial phase, SAA Voyager members will be able to use their Miles as full payment. During the course of 2015, part payment of Miles and cash will be introduced and members will be informed when the technology supporting this feature, has been finalised for implementation.
4. Based on the new SAA exclusive earning and spending structure, SAA Voyager members’ loyalty towards SAA will be rewarded with a leading principle of at least 5% return on their SAA spent when requesting an SAA exclusive Dynamic Award for an SAA operating flight. Therefore, if an SAA Voyager member has spent R5 000 on an SAA operating flight, a value of R250 in loyalty Miles as a currency will be available to spend towards an exclusive SAA Dynamic Award.
5. As part of these changes, which will be effective 1 January 2015, SAA Voyager reviewed and improved the benefits of members based on their status in the programme, ensuring that loyalty over time is rewarded.
SAA Voyager’s strategic objectives are clear in that we want to attract new and retain valued customers, by recognising their loyalty and reward them fairly through the earning and spending of Miles. Of equal importance, our objective is to provide excellent customer service. We are therefore delighted to present to our most valued customers a best-in-class and Africa-first revenue-based frequent traveller offer.
The earning and spending structure for flights within the Star Alliance network, code share airline partners, SAA marketing flights, SA Express, Mango, Airlink or Swaziland Airlink remains the same.
The campaign will also be supported by an elegant marketing drive which has been rolled out on board SAA’s aircraft and billboards.