July 2017 Flybuys 10% Bonus
Transfer Flybuys before 31st July 2017 to gain a 10% Bonus of Velocity Points.
Virgin Australia and Flybuys have another transfer promotions on until the end of July 2017!
Transfer promotions are the best times to send your points across to Velocity and the added benefit is that unlike some other point programs, Velocity Points don’t expire provided you earn or redeem points at least once every 24 months.
So the current offer is Transfer your flybuys in blocks of 2000 to receive 957 Velocity Points instead of the usual 870 points.
There have been other Flybuys transfer promotions in the past including a 15% Transfer bonus in November 2016 so it may be worth holding out for an extra 5% or if you have upcoming redemption plans then it’s still good value doing it now.
Transfer your Flybuys to Velocity Points until 31st July 2017 to get the 10% Bonus.
For those people earning their flybuys from spend on the Coles Rewards Mastercard this brings the earnings points per dollar from an already very respectable 0.8 points per dollar (ppd) to 0.88ppd.
There is a cap on the number of points to transfer to Velocity each year which currently stands at 138,000 per year.
Also worth bearing in mind that Velocity Points do have an almost cash equivalent as you can redeem 2000 Flybuys for $10 off groceries at Coles. So in essence this equates to a value of 0.5cents per point, so you’re forgoing this discount and you’re essentially ‘buying’ each Velocity point for 1.1 cent per point usually and just over 1 cent per point under this promotion.
So worth bearing this in mind and ensuring that any potential redemptions are in excess of this value.
Let’s look at some examples of an award redemption for Sydney to Melbourne in Business Class.
Now let’s look at the cash fare prices
If we price up the redemption value for the Sydney to Melbourne Flights, and pay our taxes using cash (usually the best approach) then we come up with a value per flight of $181.90 for Economy and $728.89 for Business Class. Dividing these value by the number of points required of 7,800 for Economy and 15,500 for Business Class then we can calculate a value per point of 2.3c per point for the Economy redemption and 4.7c per point for the Business Class redemption.
This doesn’t factor in the miles that would be earned off these fares.
If we factor the opportunity cost of the points that would’ve been earned off the cash fares, and include this in the maths then a non status Velocity member would earn 1,015 points and 3,750 off the Economy and Business Class Fares (5 points per $) and for a Platinum Member they would earn double those values – 2,030 and 7,500 points respectively.
The way we like to adjust the calculation to check if we’re still getting good value is to add these figures back to the cost we are paying in points i.e. for a non status member the cost would be 7,800 plus 1,105 = 8,815 points and for a platinum member the adjusted cost would be 9,830 (The Platinum member has more opportunity cost as they would usually earn more miles due to their platinum status).
The good news is that this still brings the value per point in at 2.06cpp (red member) and 1.85cpp (Platinum Member) for the Economy flight and for the Business Class Flight 3.79 (red member) and 3.17cpp (Platinum Member).
Both would be decent redemptions for a Member with basic Red Status.
The Platinum member arguably would be borderline redeeming for the Economy flight as it’s below our threshold of trying to get at least 2c per point of value. Once you factor in Status Credits foregone on an award flight, the cash price may be the optimal solution if the Platinum member were considering this economy redemption. But that’s a decision for the platinum member and whether they need have an excess of status points of velocity points at that point in their membership year. Silver and Gold Status members would be somewhere in between. The full details of points earned on paid fares based on Velocity Status is here.
Our rough rule of thumb calculation for Velocity Points is to earn at or below 1cpp and redeem at or above 2cpp.
We also see that the Any Seat Award is poor value at 0.65 cents per point of value. We would be better doing a grocery shop or saving the points for a better redemption if this was our only option – i.e. the other awards were not available. It’s these types of awards that make people wary of award programs as they don’t see the value for saving up for a long period of time to spend 31,300 points on a redemption.
But readers of this blog and our series on Travel Hacking Business and First Class Travel would know never to do an Any Seat Award Redemption if we wish to get good value out of our points.
The link to transfer your Flybuys to Velocity Points is here.