Business Travel iQ
British Airways has changed the way it calculates reward points per flight as part of its Executive Club loyalty programme. Rather than points being directly tied to the flight's mileage, it will vary according to the cabin and the class booked. In practice it means that those in the higher fare classes of economy or business will earn more miles than those on restricted tickets. From 28 April, the rewards will be broadly proportional to the amount paid.
No one should be surprised as this is how other businesses from Homebase to Tesco reward points. However, the travel industry has always seen itself as different and it was only last year that American carriers such as Delta Air Lines began the shift to tying points to spend.
Of course, British Airways has done this for some time with tier points and reward bonuses for those in the elite silver and gold classes (although silver members will see their bonus fall from 100% of the reward to 50%).
The only surprise is probably why it's taken British Airways so long to make these changes. Its lounges at Heathrow are regularly full to bursting and access – as Tara Palmer Tomkinson discovered to her cost at Christmas when she was rather too over-insistent on seeking access to BA's First Class Lounge.
Although no one pays a fee to enter a BA lounge, they are not without cost as anyone who has enjoyed the Johnnie Walker Blue or Krug on offer should have realised. Access is highly desirable not only for the food and drink but for the ability to relax or continue to do business before boarding a flight.
There is limited capacity in the lounges – British Airways is only rewarding those who are giving them the best margin business.
That is revenue management in action.