QFF Misleading Points Conversion

It's well known and thoroughly discussed that flights tend to be a fairly good way to spend QFF points and gift cards tend to be a poor choice. However, I find that the points conversion calculations for flights tend to be misleading given that flying via Qantas is overpriced to begin with. As an example, say I want to fly return to New York.

One option is for me to use QFF points at say 1 point = 1c value. The Qantas flight might cost me 120k points and the Qantas flight might be worth $1200 in value (excluding taxes and fees).

Another option is for me to find the best available deal (as any OzBargainer would), potentially with another airline. Let's just say there was a flight with Virgin going for $700 (excluding taxes and fees).

In this case, I would value the 120k points to be worth $700 (1 points = 0.58c value) rather than $1200 (1 point = 1c value). The example I gave is made up, but it's not hard to find a deal better than what Qantas offers. In fact, most deals and airlines are significantly cheaper than Qantas so the figures in my example are not far off.

My point is - comparing points this way leads to a very different points valuation outcome. So even for frequent international travellers (whose main objective is value and don't mind airline), there is some justification to use points on gift cards rather than flights. Domestic flights are a different story and are out of the scope of this discussion.

I'm fairly new to QFF and have not done extensive research but what do you guys think, do you agree or disagree? Let me know your experiences.

Comments

  • +1

    Redeeming reward flights with points really only makes sense if you're redeeming for premium cabins eg. Business or first class, where the dollar cost of such flights are very prohibitive but the equivalent points cost makes them attractive. The problem with doing this on QFF is that there is very limited availability of premium cabin reward seats on their flights, so you'll have to plan quite far ahead in order to secure those seats. Also, the tax portions of the reward flights are also very high, compared to other programmes, so you'll have to take that into account as well

  • Economy to Business upgrade MEL-LAX-MEL is 144,000 pts.

    At the moment I can buy this for $6150 on sale in Feb.

    So say I buy an economy ticket and upgrade for $1400 return plus 144,000 thats $4750 of value for my points.

    So thats 3.29c per point which is triple the OP suggestion of 120k for a $1200 ticket of around 1c per point.

    As above, the best value per points is premium cabin upgrades.

    • Yes I agree that upgrades (such as the one you mentioned) are good on a "cents per point" basis, but is it still a good deal if you are looking at an overpriced flight (i.e. is the $6150 business upgrade really worth $6150 to begin with?)

      As an extreme example, if Qantas decides to double the price of upgrades (so that the upgrade you mentioned is now "worth" $12300), the value of the flight points will now be 6.58c per QFF point for premium upgrades, double the 3.29c per point before the price hike. Note the increase in value on a "cents per point" basis but no increase in "true value" at all (since you are receiving the same service as before the price hike)…

      • +1

        Is business class worth that price tag? Probably not. But it costs what it costs so that's the current value of the points spent. And it's unlikely to double or halve anytime soon from that sort of price.

        I'm not sure what you're trying to say overall. FF points are funny money, so you just have to be smart when you use them to maximise value.

        Points don't have a true value. Every product you buy with them has a different $ ratio. It's more about perceived value and some products are clearly better than others, but things like premium cabin upgrades are worth more to some people than others.

        For example I value travelling first class as a once in a life time thing that I would never pay cash for. But with points this is attainable and I might do it once for a bucketload of points. To another person this is a total waste and thy would rather buy woolies gift cards.

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