Velocity Frequent Flyer drops 1 million reward seats, 1 point rewards

Virgin Australia has fired its next shot in the war against rival airlines with a massive frequent flyer points move.

Virgin’s frequent flyer move to shake up the industry.

Virgin Australia has just announced its next big move that will see passengers score reward seats for less points.

The Velocity Frequent Flyer program will see a new “1 Point Rewards” program that offers seats at lower point thresholds as part of an additional one million rewards fares — making it one of the largest releases in the airline’s history.

Now, Velocity members will be able to redeem just 1 Velocity Point for Virgin Australia flights and household goods.

It comes as the loyalty arm of the airline undergoes a massive overhaul with the new points structure now featuring three tiers, up from one, to offer members different price points, from today (June 5) to July 5.

The minimum points now needed for a rewards seat on domestic flights starts at 6200 points down from 7800 — a move that rivals fellow airlines.

The tiers are based on each zone of travel with tier two from 7,800 points and tier three from 9,900 points.

Virgin is slashing the number of Points required to redeem a domestic flight i.e. how many Velocity Points needed for a free flight.

Reward seats are also all-inclusive offering with a complimentary checked baggage allowance and seat selection.

But passengers need to factor in extra taxes, fees and carrier charges.

Velocity’s big push comes as the program reaches 11.5 million customers. It is calling the changes a “new era” for the third-largest rewards product in the country.

“We are proud to now offer the lowest domestic flight redemption rates of any Australian airline,” Velocity Frequent Flyer CEO, Nick Rohrlach said.

Nick Rohrlach, CEO of Velocity at Virgin Australia. Picture: Dallas Kilponen/Virgin Australia

“This shows our commitment to bringing value to members who can really drive their dollar further for being part of Velocity.”

“We know from the data that Australians want fast rewards from their loyalty programs and that’s what we are giving them.”

According to Love or Money Report, The Point of Money (May 2022), the top concern for more than half of Australians (51 per cent) when it comes to loyalty programs is “the effort required to earn rewards”.

Redeeming flights for fewer points also ranked as the most compelling feature for Aussies looking to participate in airline loyalty programs.

The program will this week launch ‘1 Point Rewards’ giving members the opportunity to redeem just 1 Velocity Point in exchange for domestic and international flights.

“We know it’s hard to believe that a member can go on a holiday for just 1 Velocity Point or purchase a Dyson hairdryer for the equivalent of a $2 purchase at Coles, but this is the beauty of our 1 Point Rewards initiative,” Mr Rohrlach said.

As part of Virgin’s changes, members will also be able to buy items from popular brands including Dyson, Apple and Weber or flights with just one reward point.

For example, one point can be exchanged to buy a Dyson hair dryer valued at nearly $650.

Adele Eliseo, founder of The Champagne Mile, advised travellers “to move quickly” to snap up the more than one million additional economy rewards released today.

“For the best chance of scoring a dream redemption, frequent flyers should be prepared to be flexible to travel during off-peak periods, as blackout periods apply to reward seat availability around school holidays,” she said.

The minimum points now needed for a rewards seat on domestic flights starts at 6200 points down from 7800 — a move that rivals fellow airlines.

“Reward seats on popular and routes are expected to sell out quickly. Travellers who are able to take advantage of searching less familiar regional services and new additions to the Virgin Australia flight network are likely to have a better chance of scoring a redemption.”

She said while travellers can now expect to pay 20 per cent less Velocity Points on domestic economy rewards during off peak times, this will be offset by an increase of over 20 per cent Velocity Points that will apply during popular travel periods.

Joel Gibson, of One Big Switch, said lowering the entry bar and adding more rewards seats was good news for frequent flyers but “it remains to be seen if it’s enough to solve the problem” of high demand for these tickets.

“It will certainly help and consumers want to see more seats at a lower entry point across all airlines,” he toldThe Herald Sun.

“My only concern is the date limitations. One million new seats at a lower entry point sounds amazing, but unless one million people want to travel in those periods using points it’s just a very clever PR strategy.”

The 1 Point Rewards sale begins with a pop-up store on Chapel Street in Melbourne on Saturday, June 10, where the first 100 members will also receive a guaranteed one-point flight.

The sale will roll out across Australia online on Sunday, with deals dropping at undisclosed times once a week for four weeks.

It comes as Virgin nabbed Qantas’ travel partner Luxury Escapes for its points system, last week.