Frequent Flyers accumulate points for travel - but have to settle for merchandise and gift cards

Unhappy Frequent Flyers

Frequent Flyers are unhappy.  With the notable exception of the New Zealand carrier, they can't use the points for flights - the reason they were accumulating them in the first place.   Many airlines have addressed the problem by offering a release value for the pressue of points buildup - online shopping malls where points can be used to buy merchandise and vouchers.  Qantas is the biggest in our region doing this. 

Forget flights - give us something we can get

So customers are telling us that they want to use these Frequent Flyer points on something else as the Freddie Award analysis below shows.  51% of Frequent Flyers in this survey said that non-air (so, merchandise, gift cards etc) were very important or important as rewards in theprogram.

With this as the industry backdrop - Air New Zealand have become the global innovator.  They've opened up the whole of the plane on every flight to their Frequent Flyers in the Airpoints Dollars program.   That hasn't protected them from the global downturn though and their profit dropped 80% in the first half of 2009.