Woolworths And Qantas Boosting Loyalty Card

Qantas, Australia’s flagship airline, and Woolworths, the country’s largest supermarket chain, teamed up early last year to offer a wider range of rewards to credit card holders. Qantas Frequent Flyer card members were automatically signed up to the Woolworths Everyday Rewards program, allowing the latter to tap into Qantas’ solid market of about 6 million members.

Thanks, but no thanks

Prior to the deal, which was signed in June 2010, only about a third of Qantas members were signed up to Woolworths. The airline sent the rest of its members an email message saying they would soon be automatically enrolled in the program. This meant, among other things, that they would be able to earn Qantas points for rewards by shopping at Woolworths stores. Woolworths Everyday Rewards members could sign up for the Qantas Frequent Flyer program free of charge (membership cost $82.50 as of 2011).

Not everyone was happy about the change, however. Some didn’t appreciate being signed up without prior consultation (the email simply informed them of their eventual enrolment), and others were simply unhappy with the terms. Those who called Qantas to complain were told to sign up for an ANZ Qantas Card instead, according to the Sydney Morning Herald.

“The credit card people”

The Woolworths Everyday Rewards program, launched in 2007, involved a store-issued credit card that customers could use to build up loyalty points. It followed the steps of rival supermarket Coles, and set an example for later store-issued cards, including the department store David Jones. As was often the case with such programs, Woolworths expected it to be followed by loans, car insurance, and home insurance deals, the SMH reported. As the paper put it, “the fresh food people” (Woolworth’s popular tagline) are now “the credit card people.”

Catching on

In December 2008, the two companies announced that Everyday Rewards members would be able to earn frequent flyer points on the Qantas program. Points could be earned at Woolworths supermarkets and liquor stores, and no fees were charged for the membership. Later, the scheme went on to include other Woolworths outlets and Woolworths-controlled stores, such as liquor outlet BWS and the department store Big W, and later on electronics retailers Tandy and Dick Smith.

Banks have also started offering both programs jointly. In October 2010, for instance, HSBC launched a MasterCard credit card offering both Qantas Frequent Flyer and Woolworths Everyday Rewards memberships. However, as rewards credit cards go, the more attractive the rewards, the pricier it gets: the said credit card came with an $89 annual fee and an interest rate of almost 20% p.a., according to LifeHacker.

Making it work

Combining supermarket and travel rewards can be convenient, but it takes a good amount of planning. Choice, a consumer information group, reminds consumers to watch where their points are going: they can either go to the frequent flyer program or the card issuer’s own rewards scheme. While both offer potentially attractive returns, it helps to keep an eye on them if you’re saving up for a particular reward (such as flight discounts). “Rewards Seats” programs often offer the best value for money but aren’t as widely available, so planning your trips alongside everyday spending can also go a long way.

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