Images courtesy of Virgin Atlantic

Virgin Atlantic has today announced a host of changes coming to their frequent flyer program, Flying Club. For some background, the SkyTeam member’s program enjoys some popularity, as it has some excellent award redemption rates for economy flights to Europe, although it also passes on sometimes hefty fuel surcharges. Furthermore, their ‘Upper Class’ business class cabin is generally favorably reviewed, and has a loyal following. Perhaps of most interest: Flying Club also has some excellent sweet spots, such as great redemption opportunities to fly ANA’s first class (if you can find availability). However, with the changes just announced, it’s not entirely clear if that value will be maintained.

In a press release, Virgin Atlantic announced that as of October 30th:

• “The price of seats will vary in line with demand, in a similar way to standard tickets.”
• Rather than the usual 12 guaranteed seats on every flight, every single seat will be available for points redemption, in every cabin.
• Points will also be used to upgrade from one cabin to both Premium and Upper Class.
• Supposedly there will be saver awards as well, at a price point similar or lower than offered currently. For example, Virgin Atlantic states the possibility of redeeming just 6000 points for a flight to New York, though the origin remained unspecified – probably London?
• The number of points earned on Upper Class and Premium tickets will be increased by respectively up to 50% and 75%.

We will have to wait and see how these promises translate into actual redemptions, and whether things get worse, stay the same, or perhaps improve, although history suggests that when a program adopts dynamic pricing, it’s generally for the worse. For example, when Delta adopted dynamic award pricing, SkyMiles underwent big devaluations, with award rates skyrocketing.

Note that all that was stated in this press release concerned Virgin Atlantic redemptions. There hasn’t been any statement with regards to partner redemptions, so as of now it is not clear whether redemptions for, say, ANA will change. We will have to wait and see…