Which frequent flyer program should you join? ↦Almost every airline has a frequent flyer program, and deciding which to join can be confusing. Throw in Flybuys/Woolworths Rewards and international travel with different airlines and things can get confusing. On top of that, very few frequent flyer programs allow you to transfer points between them. If you're not careful, you can end up with small amounts of points scattered over many programs with little chance of making use of them.
This is a general approach that should suit most people, but if you have some special requirements for travelling on a particular airline or route, it may not be as suitable. Frequent flyer programs offer a confusing array of benefits, so in those rare instances, some extra research will be needed.
For everyone else based in Australia, you only need to join three frequent flyer programs to have access to earning and redemption options across 60 international airlines, plus the two major Australian domestic airlines. These three are: Qantas, Virgin (Velocity) and Singapore Airlines (Krisflyer).
Virgin and Singapore Airlines
The big reason for joining both Virgin and Krisflyer is that they have a very rare alliance where you can transfer points between their programs. Given the flexibility it creates, the rate of conversion isn't too bad at 1.35 to 1. For example, 13500 Virgin points will convert 10000 Kirsflyer points. Or transfer 13500 Krisflyer points and receive 10000 Virgin points. Note, however, you need a minimum of 5,000 points for a transfer. One big advantage is that while Virgin has a small number of airline partners, Singapore Airlines is part of the StarAlliance, meaning you have access to airfare redemptions across the 27 members of the alliance, plus some of Virgin's partners such as Etihad.
If you are flying a StarAlliance member on a paid ticket, these points can go to your Krisflyer account. When needed, these can be further transferred to your Virgin account (but you will lose points in the process). For example, you fly on a single Austrian Airlines flight within Europe as part of a holiday. If you used the Austrian Airlines frequent flyer program, you'd end up with points that are not much use. There wouldn't be enough for a flight, and they don't fly to Australia. Since Virgin Australia is not a part of StarAlliance, you can't directly earn points in your Virgin account. If you nominated your Krisflyer account, these would accumulate there and once your Krisflyer account reaches 5,000 you could transfer them to Virgin.
Likewise if you have plenty of Virgin points, which may happen if you have been part of Flybuys for years or have a Virgin credit card, transferring to Singapore Airlines will give you flexibility if you need it. One caution: always check with airlines that they have frequent flyer availability before transferring.
One issue with the Krisflyer program is that points expire after three years of earning them. You can pay extra for a temporary extension, but the easiest option is to transfer expiring points out of Krisflyer to Virgin. Virgin only require some point activity per year to keep them active, so this is a nifty way to rescue expiring points. It may mean losing some points in the process, but that's better than letting them expire.
The power of being able to transfer points
For members of Flybuys, the Virgin partnership indirectly allows Flybuys point redemptions on all StarAlliance members, extending the reach well beyond Virgin and its partners. A quick calculation shows a dollar spent at Coles (or a Flybuys point earned anywhere) transferred through the system earns 0.32 Krisflyer points.
As mentioned above, very few frequent flyer programs allow you to transfer points between airlines. However the airline alliances and some partnership arrangements do allow you to earn points in your nominated frequent flyer account when you fly on a partner airline. Be aware that unless the flight is listed as code-share, you're likely to earn less points this way. Code share is when a flight is sold using one airlines ticketing number, but operated by another airline. You might for example, fly Emirates, but if your ticket has a QF number in front of it, this is a code-share flight where you are earning points as if you're flying Qantas, even though it is an Emirates plane. Conversely, if you booked the same flight under an Emirates ticket code with EK on it, you'd earn less points in your Qantas frequent flyer account as partner flights typically earn less points than code-share flights. For partner airlines, it is often worth taking a small hit to enable your points to consolidate in one account.
For those looking to collect Velocity points at BP stations, which yields Virgin points at 8x the rate of Flybuys, this can add more points to your Virgin account (for a full run-down see The best petrol loyalty programs).
The third and most popular frequent flyer program in Australia is Qantas. For Australians, there are so many different ways to earn points, it makes it worthwhile to have an account even if they are not your preferred airline. As discussed in How useful are Woolworths Rewards?, joining has the advantage that you won't need to be loyal to a supermarket to gain a benefit. You just shop at your preferred place and if they take Woolworths Rewards, then you can let them pool in your Qantas account. This can also apply to other shopping opportunities too. If Qantas points are there for the taking and you were going to make a purchase regardless of the Qantas points, it is worth the top up.
Significantly for redeeming airline reward tickets, Qantas is part of OneWorld and has a separate partnership with Emirates (and others). Plus there is no points expiry as long there is activity once in an 18 month period. Hence the Qantas program is one of the most significant for Australians, but it's not without its drawbacks. The two big gripes with the Qantas program are the high taxes and surcharges when redeeming an airline reward, and that desired reward seats can be difficult to redeem.
Between these three frequent flyer programs, you can gain access to a wide range of points-earning opportunities and redemption options. The programs also raise the question: is it better to be loyal to one airline? The short answer is no. The best way to capitalise on frequent flyer programs is to spread your loyalty around the three programs and take the best deal on offer. Depending on your own personal circumstances, you may choose to focus on Qantas or Virgin/Krisflyer. However, with all three programs, you won't you feel compelled to stick with one program and get suckered into buying items or airfares at more expensive prices because of a points deal. A side benefit is that when it comes to redeeming free flights, you have more flexibility and you may find it possible to use one frequent flyer program to fly out, and another one to return.