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The Aim of any Travel Hacker would be to fly Singapore Suites First Class

Travel Hacking Business and First Class Travel in Australia

Following on from our post on Travel Hacking Business and First Class Travel let’s delve into some details on how to get started Travel Hacking in Australia.

This article will cover the following:

  • The Myths of Getting Business Class Upgrades
  • Three Main Ways to Travel Hack Airfares
  • The Role of Frequent Flyer Points, Air Miles and Hotel Points in Travel Hacking
  • Choose the Best Frequent Flyer Schemes to Earn Points or Air Miles With
  • Not all Points are created equal
  • Treating points as their own currency
  • Aim for hotel and flight redemptions directly with the airlines and hotels
  • Know what type of award program you’re dealing with
  • Start with the Desired Redemption in Mind
  • Aim for hotel and flight redemptions directly with the airlines and hotels

So let’s get cracking…. how do we achieve our Travel Hacking goals?

Travel Hacking The Hard Way

Travel Hacking The Hard Way

The Myths of Getting Business Class Upgrades

When I first started looking into travel hacking I, like many others, was under the impression there were ways of getting an upgrade like being smartly dressed, arriving early or late at check-in, asking at check-in for an upgrade. etc. etc. The reality is these are all totally untrue.

I even tried this once, wearing a suit, shirt and tie for a long haul flight to Europe, asked for a better seat at check-in and checked-in early. I did get moved to a slightly better seat in economy with a bit more space but it wasn’t business class and I then had to change out of my suit and have it crumpled in a bag for the flight and on my holiday!

The reality is that any upgrades on oversold flights (where there are more people travelling in economy than there are seats) where they need to give someone an operational upgrade to business class are based on defined rules which give priority to the airline’s most valuable customers – those who fly often or spend the most on fares.

When we fly once or twice a year on our discount economy fares we are not going to get an upgrade despite rocking up wearing an Armani suit or the lastest designer gear. It’s just not, repeat not, going to happen! So the irony of playing this upgrade game is that the smarter you are at getting a cheaper fare, the less successful you are going to be at getting an upgrade.

If you switch from one airline to another each time based on price or schedule, you aren’t seen as valuable to any one airline.

The airlines want you to pay top dollar for your fares and be loyal to their airline – choosing their airline over other cheaper fares for every flight. And if you do that, even a lot, the reality is you will always be behind other people who fly many times a week on business and if you’re paying, it will cost you a lot more.

The techniques we’ll cover here will cost a lot less and you’ll be sitting in front of most of these ‘canny’ frequent flyers with status.

Dressing in a Suit won't help you to Travel Hack an Upgrade.

Dressing in a Suit won’t help you to Get an Upgrade.

Three Main Ways to Travel Hack Airfares

There are three main ways in which you can achieve your goals of travel hacking which are to give you cheaper, more, and better travel experiences.

The brief version is:

  1. You can take advantage of mistake fares (where prices have been added incorrectly into the airlines’ or hotels’ pricing computer systems) or hacked fares where we deconstruct a longer journey and fly direct via various low cost hubs, or fly to a low cost hub and then make use of cheaper fares.
  2. You can fly more often and strive for an elite Frequent Flyer Status with one or more of the airline alliances such as OneWorld, Star Alliance, SkyTeam, or Etihad Airways Partners which then gives you a greater chance of getting an operational upgrade, or bidding for an upgrade with frequent flyer points or air miles. These also give benefits such as lounge access with free food and drinks, priority boarding and bag delivery.
  3. Buy or earn frequent flyer points, Air Miles, Hotel Points etc. to redeem for awards where the cost of buying or earning the points is LESS than the value of the flights or experience you are redeeming for.

 

Mistake Fares and De-Constructed Fares

Mistake fares sometimes provide pricing of business class fares or first class fares for hundreds of dollars rather than thousands. They cannot be predicted to appear on any particular date and time and have to be jumped on straight away before the mistake is rectified, and so are difficult to benefit from for anyone without a fully flexible schedule and the ability to position themselves to the gateway to take advantage of the fares.

Sometimes the deals die quickly and sometimes they are not honoured by the airlines so create havoc when creating travel plans such as booking hotels or accommodation. In short, they are not for the faint-hearted. They can have a place in our toolkit, however.

De-constructing your flight into separate legs and searching pricing for the legs separately or trying to route via renowned cheap airports such as Manila, Cairo, or gateways where fuel surcharges are not charged can bring you a lower total fare than the comparable direct fares. This can be time consuming however and is more applicable for economy flights generally. It also still involves paying for flights.

Elite Flyer Status

Obtaining status requires a lot of bum on seat flying in economy or the purchase of expensive business class or first class fares or fully flexible economy fares. For some people this may be possible in a work capacity where you’re able to influence your travel plans and airline you are booked with but this isn’t a technique widely available to all.

Occasionally there are also situations where the value of the points or status credits from flying a route are worth more than the cost of the flights. These are known as mileage runs or status runs.

 

Buying or Earning Points – Obtaining Points in Some Capacity

We will deal with Mistake Fares and Obtaining Status on CreditFlyer  but will mainly concern ourselves with the role of Frequent Flyer Points, Air Miles, Hotel Points, because of the ease of earning them in Australia following the right techniques and the flexibility this allows when making our travel plans. (In most cases the tickets are less restrictive in terms of making changes than the cheap discount economy fares!)

The other benefit of this approach is it doesn’t mean you have to fly a lot or stay in hotels a lot to earn a lot of points. In fact the opposite is true these days – there are now more options to earn points outside of flying. We will cover off the ways and means of obtaining points in due course. It’s a win-win too as by obtaining points in a travel provider’s scheme they are making money by selling points to the organisation you got your points from.

The other options listed above have merit but also are not wholly sustainable for most people as a means of getting better travel.

Our methods don’t require high status executive roles or job roles than involve a lot of flying. They are open to all.

So this is the raison d’être for this website. Obtaining points smartly and using them to enable us to travel in comfort and style.

Note that we said obtaining, not earning, as there are often ways to buy miles from some airlines and use them on partner airlines to obtain outsized value from them as can be seen in our Article on Buying Avios to save 85% off Qantas Business Class Fares

The Role of Frequent Flyer Points, Air Miles and Hotel Points in Travel Hacking

We’ll now deal with how points come into this and how to best optimise our use of points.

We redeem those points in smart ways to optimise their value and travel in business or first class or enjoy Five Star Hotel experiences paying a lot less than you’d pay retail.

We’ll now cover off how to:

  1. Choose the Best Frequent Flyer Schemes to Earn Points or Air Miles With
  2. Maximise Earning with those Schemes
  3. Redeem your points in smart ways to optimise their value and travel in business or first class or enjoy Five Star Hotel experiences paying a lot less than you’d pay retail.

 

Choose the Best Frequent Flyer Schemes to Earn Points or Air Miles

We are faced with the choice of more than a hundred different travel award programs.

Some of the main ones that are relevant for our purposes in Australia are as follows:

  • Qantas Frequent Flyer
  • Virgin Australia Velocity Awards
  • Singapore Airlines Krisflyer
  • Etihad Guest
  • JAL Mileage Bank
  • Malaysia Enrich
  • Cathay Pacific AsiaMiles
  • British Airways Executive Club
  • Air New Zealand AirPoints
  • Emirates Skywards
  • Thai Airways Royal Orchid Plus
  • GarudaMiles
  • American Airlines AAdvantage
  • Starwood Preferred Guest
  • Hilton Honors
  • Le Club AccordHotels
  • Marriott Rewards

This can be viewed by some as the Paradox of Choice, and most people either aren’t aware of the choice or just assume they are all similar and accrue their awards with Qantas Frequent Flyer or Velocity Frequent Flyer programs as these are the main two within Australia.

Choice in this context, IS a good thing. Complexity IS a good thing. Complexity for us means Opportunity 🙂

As we showed in the article on how to get business class flights in Australia at Economy Class pricing, this fairly convoluted process means 80-90% of people will give up and not proceed with a hack even when delivered to them on a plate. It is easier following the crowd and paying to sit at the back of the plane than taking a bit of time to learn how to master the tricks that enable you to travel in style FOR LESS.

Likewise because the majority of people in Australia choose the two main frequent flyer programs means that for those of us who are willing to do a bit more research we can maximise our opportunities by choosing DIFFERENT programs to accrue our points and miles.

The weirder or more obscure the program in some ways can mean the better it is for us to travel hack by knowing who they partner with for redemptions. Only last year for example it was possible to buy points in JetAirways JPMiles programme to book flights from Australia to New Zealand on Emirates A380 flights. JetAirways is an Indian Frequent Flyer programme that partners with both Etihad and Emirates and one I would suggest few people in Australia except the very dedicated have used.

Programs like Qantas Frequent Flyer and Velocity Frequent Flyer that are geared towards Australians are optimised to price ex-Australia redemptions more expensively. Air New Zealand Airpoints is similar in New Zealand. Other programs may have sweet spots where the cost for travel to or from Australia is priced nicely, as their main audience may be less likely to redeem in these ways (like the JPMiles example above). We’ll look at two examples later on in this article.

 

Not all Points are created equal

If Thomas Jefferson were alive today and into travel hacking then he’d surely say that:

“Not all Points are created equal”

The various point schemes differ in a number of key ways:

  • Expiry Policy – in some, points expire after a period of time; with others they may be extended by having activity within your account.
  • Redemption Rates – The cost to redeem can vary drastically for the same flight. A return business class trip from Australia to Europe with Thai Airways costs 170,000 miles. With Singapore Airlines 190,000. The same trip with Qantas costs 256,000 points (50% more than with Thai!). With Etihad it costs 325,684 from Sydney (91% more than with Thai!). In fact it’s 41% cheaper to redeem for a first class award on Thai than the business class award with Etihad
  • Carrier Charges you pay when redeeming. This varies upon route but some carriers such as Qantas and British Airways impose high surcharges when booking. In some cases this means economy redemptions are very poor value as the surcharge is the same regardless of the class of service.
  • Availability of Awards and Alliances – Some such as Air New Zealand Airpoints have historically had very poor redemption ability, others require you to book almost a year out, and yet others still release many seats close to the travel date. Knowing the quirks of the various schemes makes you prepared to redeem for your chosen awards.

Treating Points as their own Currency

Essentially it’s important to treat points as their own separate currency, so when you earn, it’s a good idea to be able to quickly work out the cost of earning them (if there is a cost i.e. credit card surcharges  on some card types which can be worth paying on occasions – we will come to that later ) and when you redeem the points, work out the value of your intended redemption against the cash purchase of the same flight, hotel etc.

Generally the card schemes have all sorts of redemption opportunities such as electrical goods, gift cards, magazine subscriptions and so on – the list is almost endless.

 

qantas store sports

Qantas Store Sports

Their goal is to get you to redeem for the lowest value redemptions, and our goal is the opposite. They make more money this way and you exchange your hard earned points for a reward of less than optimal value.

If you can easily evaluate and place a value on your frequent flyer currencies you then are able to rapidly decide how much you are willing to pay (if at all) to acquire them and when to use them and when not to use them and pay cash for your flight or hotel booking.

This all sounds a bit technical, but it’s the most important concept when using points. Unless you have an unlimited ability to earn points then we need to place a value on earning them and burning them (redeeming).

We obviously aim for the Redemption Value of a Point to be Greater than the cost of Earning it.

For example if you place a value of 2c on a point, then it may make sense to pay 1c to earn a point as you are doubling your return on the cash invested.

Aim for hotel and flight redemptions directly with the airlines and hotels

The best value redemption opportunities lie in transferring points to airline and hotel schemes and redeeming for flights we otherwise may not be able to afford or be willing to spend so much of our hard earned money on.

The other thing to bear in mind, is that some award schemes allow you to redeem directly through the card provider’s travel portal. This is generally not the best value, although there maybe exceptions.  So we try to stick with redeeming for awards directly with the airline or hotel provider i.e. transferring your points to the airline or hotel’s point scheme directly.

Also within the Airline’s schemes, some offer Any Seat Awards – avoid these as they are based on a low redemption value. they usually appear if there are no standard priced awards available.

Know what type of award program you’re dealing with

Often the best schemes for our purposes are not revenue based, and so provide opportunities for what are called ‘sweet spots’ in their award charts.

We can classify airline award charts into four key categories:

1.  Region or zone based pricing – airlines including Singapore Airlines and American Airlines quote a price  travelling from one zone to another e.g. anywhere in Australia to anywhere in New Zealand. Obviously as a consumer we would derive better value redeeming for a flight from Perth or Broome to Auckland, rather than Sydney to Christchurch which is a shorter distance and usually therefore cheaper.

2.  Mileage band based pricing – Qantas and Virgin Australia quote an award price based on distance travelled within certain mileage zones so it’s roughly based on distance but again to destinations with in the same zone would be the same price, but the revenue fare for these flights maybe different.  This creates opportunities for a would-be travel hacker to optimise the flight lengths to these travel bands.

3.  Distance based pricing – Etihad Airways are an example of an airline who price awards directly based on the distance travelled. For example an award from Melbourne to Abu Dhabi would be priced differently to an award from Sydney to Abu Dhabi. They also have different pricing for their partners which is more mileage zone based.

4.  Revenue based pricing – in this scenario a point directly corresponds to a dollar value to be used towards travel. This, for a consumer is one of the worst types of programs.  The upside to such programs is that they generally  aren’t subject to devaluations  other than general inflation of the related currency.  Air New Zealand Airpoints are an example of this type of program.

The first three types of programs provide the most opportunities for us as travel hackers.

Start with the Desired Redemption in Mind

There is no one best Frequent Flyer Program for everyone. The choice is subjective and personal based on the desired redemptions you have in mind. This may change from year to year as your travel choices change.

Depending on the type of point or mile, we can look at our desired redemptions and look at the costs in points or miles for all the various frequent flyer schemes that we have access to.

Let’s find out how by looking at two example one-way Business Class redemptions we may be interested in:

  1. Flying Sydney to London using Frequent Flyer Points
  2. Flying Melbourne to Perth using Frequent Flyer Points

There’s a free to use website called AwardAce that allows us to compute the cost of flying a particular route. Let’s look at the cost for these two common flight options:

Flying Sydney to London using Frequent Flyer Points

London

London

 

Travel Hacking Business Class Sydney to London using AwardAce

Business Class Sydney to London AwardAce Options

We can see the price varies in terms of miles or points by between 75,000 to 247,500!

We have to bear in mind the AwardAce disclaimer because the data may have changed since they last updated their database but it’s a good guideline and a starting point for our research.

Let’s narrow these down to the common programs we see in Australia and look at the differences doing our own research:

 PointsTax
Thai* if booked as part of a return award85000144.60
Singapore Krisflyer10500096.11
Thai (one-way award)118000144.60
Qantas128000652.57
Virgin Velocity139000619.68
Etihad162842355.28
Emirates176000649.81
Sydney to London Award Pricing July 2017

 

The miles or points required still varies from between 85,000 and 176,000!

 

Emirates Business Class Sydney to London Award Pricing

Emirates Business Class Sydney to London Award Pricing

 

 

Singapore Airlines Krisflyer Business Class Sydney to London Saver Award

Singapore Airlines Krisflyer Business Class Sydney to London Saver Award

 

Here we can see that there’s a HUGE difference between redeeming on Emirates at 176,000 points plus $649.81 in taxes versus Singapore Airlines at 105,000 miles plus $96.11 in taxes or Thai Airways at 85,000 miles plus approx. $144.60 in taxes.

If we could earn points for Emirates and Thai at the same rate then we could book a return business class fare on Thai Airways using the same number of points or miles to book a one way on Emirates PLUS have some change to pay towards some accommodation or meals etc.  when we get there!

The good news is we can! There are ‘credit’ cards in Australia such as the Platinum Charge card that earn a flexible point currency and can send to both programs at the same transfer rate! The current signup bonus of 100,000 Membership Reward Points on the card which is equivalent to 100,000 Thai Royal Orchid Miles gets you more than half the way to that return business class trip. We’ll do a review of this card in another article but we’ve skipped ahead of ourselves for now.

For the person who is only interested in Qantas points, using their points for a one-way economy flight would cost 60,000 points plus $282.51 in taxes. More in taxes and only 25,000 points less than the Business Class fare on Thai Airways!

This is how we start optimising our travel hacking and the next step is to work out how best to obtain the points that provide the best value for our chosen redemption.

Note that the merits of each program will change from redemption to redemption (Remember: Complexity means Opportunity)

Flying Melbourne to Perth using Frequent Flyer Points

We’ll start with the results from the AwardAce tool again:

Using AwardAce to Travel Hack from Melbourne to Perth

Using AwardAce to Get from Melbourne to Perth

 

Now let’s narrow this down in our own table and add Etihad in too:

 

 PointsTax
Virgin America* if booked as part of a return award1350025.26
Virgin America (Elevate)1600025.26
Etihad2180020.43
Virgin Velocity3550020.43
Qantas3600036.51
Emirates3600036.59
Melbourne to Perth Award Pricing

 

Here we can see that Virgin America (elevate program) to book on Virgin Australia is almost one third the price of Qantas and Virgin Australia directly giving us a 62.5% saving on the point/miles cost and booking using Etihad miles gives us almost a 40% discount off the miles price compared to booking using Qantas Frequent Flyer Points.

Miles can be purchased with Virgin America and this used to be a good option to hack business class flights on Virgin Australia when the miles went on sale.

Virgin America were recently taken over by Alaska Airlines so that sweet spot will no longer be available soon. Bookings need to be made by 30th September 2017 and the last day for travel is 15th January 2018. You can still buy miles here but they are unlikely to have any bonus miles sales before then. Whether or not you can get value paying the non discounted price for miles is a personal decision.

We have credit cards within Australia that earn Etihad miles at the same rate as Qantas miles so our best option would be to aim to accrue points in a credit card scheme that can be sent to Etihad. Shopping at Coles and swiping your Flybuys card can earn you Etihad miles. The American Express Platinum Charge we mentioned earlier can also send miles across to Etihad.

So for these two examples we’ve shown the dramatic difference choosing different ways to make the same redemption can make to your ability to fly business class for less.

In Summary

We covered the following:

  • Debunking The Myths of Getting Business Class Upgrades
  • What the three Main Ways to Travel Hack Airfares are
  • The Role of Frequent Flyer Points, Air Miles and Hotel Points in Travel Hacking
  • How to choose the Best Frequent Flyer Schemes to Earn Points or Air Miles With
  • That not all Points are created equal
  • Treating points as their own currency
  • Aiming for hotel and flight redemptions directly with the airlines and hotels
  • Knowing what type of award program you’re dealing with
  • Starting with the Desired Redemption in Mind
  • Aiming for hotel and flight redemptions directly with the airlines and hotels

 

We’ve only touched the surface in this article on travel hacking. There’s a lot more to learn but with these principles as your solid foundation of travel hacking you’ve learnt that there’s a huge difference between the value of points between programs.

Next we’ll look at the Different Award Programs and their relevance within Australia, How Best to Earn Frequent Flyer Points quickly and How to do a self audit of what you’re spending on and how you can supercharge your point earning capability. We’ll also look at Hotel Points and Miles and How Best to earn and redeem them.

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