If you've ever wondered how loyalty programme free flights actually fly, then read on.
Free flights are a coveted reward among members of loyalty programmes, but research by Personal Finance shows that you may have to spend as much as R150 000 to qualify for a free, economy-class return ticket between Johannesburg and Cape Town. This exercise assumes you are earning points through your credit card spend only. It does not take into account the points you accumulate by buying other products and services within the programme.
Absa Rewards
The value of a reward such as a domestic return ticket varies because it depends on the deal struck between Leisurelink, whose programme Absa uses, and the airline concerned, Nicola Flynn, the general manager of marketing at Absa Rewards, says.
At the time of writing, you could get a return flight between Johannesburg and Cape Town for 20 000 points. With an Absa Rewards credit card, you earn one point for every R5 you spend, so you would have to spend R100 000 to earn this ticket. You can, however, earn points on the programme faster if you also have a homeloan and car finance. If you have a R200 000 homeloan and Bankfin vehicle finance of R100 000, you can earn 12 128 points a year on your monthly repayments, plus "start-up" bonus points and "anniversary" points.
eBucks
The travel desk at the eBucks Shop offers specially negotiated travel packages, including air tickets such as a return flight between Johannesburg and Cape Town for R1 051, which in eBucks is eB10 500. You would have to spend R105 000 using your First National Bank (FNB) credit card in order to earn sufficient eBucks to buy this ticket. However, there are other ways of earning eBucks (using a MTN cellphone, buying at Arthur Kaplan Jewellers, Wesbank vehicle finance, FNB cheque accounts and home loans), and the more you use them, the quicker you will earn points.
Certain terms apply to flight bookings - for instance, you have to book at least three weeks in advance. It costs R90 or R105 a year, depending on your credit card type, to link your card to eBucks.
Standard Bank and Nedbank
Holders of Standard Bank credit cards and of Nedbank debit and credit cards earn Voyager miles on purchases they make using their cards on the basis of one mile for every R7.50 spent. It requires 20 000 Voyager miles to earn a free Johannesburg-Cape Town return ticket, which will mean spending R150 000 using a credit card. This ticket is subject to capacity controls and you may not be able to fly when you want to.
If you want complete freedom of choice about when you fly, you will have to accumulate 30 000 Voyager miles, for which you will need to spend R225 000.
The annual membership fee for Standard Bank cardholders is R150, while Nedbank cardholders pay R125.
Standard Bank Gold MasterCard holders can link to British Airways' Executive Club programme at an additional membership fee of R150 a year.
British Airways Executive Club
Stuart Cochrane, the marketing manager of British Airways Domestic, says it is difficult to determine how much you have to spend in rands to qualify for a free domestic return ticket. It depends on the route you travel, and your membership tier level, because Silver and Gold tier members earn more miles than members on the Blue tier.
You need to accumulate 18 000 British Airways (BA) miles to earn a return economy-class flight between Johannesburg and Cape Town, and 36 000 BA miles for the same flight in business class.
From July 1 this year, you will earn 790 miles for a one-way, economy-class flight between Johannesburg and Cape Town (currently, you earn 1 290 miles). So you will need to make 12 return flights to accumulate sufficient miles to qualify for a free return flight on the same route.
The cost of a Johannesburg-Cape Town return ticket varies between R1 425 and R3 329, depending on such factors as how long in advance you book. On the basis of the average cost of a BA flight between Johannesburg and Cape Town, you would have to spend R27 876 to get a free return flight.
SAA Voyager
You need to accumulate 20 000 MileageKeeper miles or 30 000 Anyday miles to earn an economy-class return ticket. MileageKeeper Awards are subject to capacity controls.
A Voyager member would have to make 13 return flights between Johannesburg and Cape Town in the economy class to accumulate 20 514 miles (789 miles are accumulated per flight on the Johannesburg-Cape Town route if you pay the full published fare) in order to get one free ticket (20 000 miles) on the same route in the same class.
Return air fares can range in price from R940 to R2 920, and the average SAA fare in economy class on this route is R1 600. Based on this, you would have to spend about R20 800 on tickets to qualify for a free flight.
Bonitas Club
Members of Bonitas Club do not accumulate miles or points, but automatically qualify for discounts on a range of products and services when they join. There is a monthly membership fee of R20 or R40, depending on the package you choose.
Travel is booked through Medscheme Club's in-house travel agency and the price is discounted by 20 percent, up to a maximum of R1 000 per family per flight. A normal return economy-class ticket between Johannesburg and Cape Town costs R3 489 on SAA or R3 473 on BA. A 20 percent discount would knock R700 off these prices.
Discovery Vitality
On joining Vitality, members have access to airtickets at discounted prices. The costs of a return Johannesburg-to-Cape Town ticket are R1 295 at Blue level, R850 at Bronze level, R425 at Silver level, and R195 at Gold level. These prices exclude airport departure taxes.
The amount that you would have to spend to qualify for one such ticket is the monthly Vitality premium (of between R55 and R72, depending on the number of members in your family) as well as the Discovery Health medical scheme or Discovery Life premium. The premiums for these products differ between individuals.
Oxygen Levels
Your membership level determines what you need to do and spend to be rewarded with a domestic airticket, Nicky Adams, the business manager at Old Mutual Healthcare, says. Your membership level - from O1 to O4 - is determined by a professional health assessment. The higher your level, the more points you earn. The average (not particularly healthy) individual will be probably be placed on O2.
A return ticket between Johannesburg and Cape Town requires 9 765 points. Members on the O2 level who, for example, pay their monthly medical scheme contributions timeously, have their blood pressure, body mass index and body fat percentage measured, refer two people to the programme, go to the dentist once a year, complete an online self-assessment, and have their glucose and cholesterol checked, could earn about 6 280 points. This is not enough points for a Johannesburg to Cape Town return ticket, but will buy a one-way ticket between Johannesburg and Durban (6 280 points).
However, members at the O3 and the top O4 levels who take the same health steps above, earn 10 170 points and 12 840 points respectively, and so qualify for a Johannesburg-to-Cape Town return ticket with points to spare.
Members at any level qualify for "instant rewards" on joining Oxygen Levels. An example of an instant reward is a discounted economy-class return ticket between Johannesburg and Cape Town of R1 600.
This article was first published in Personal Finance magazine, 2nd Quarter 2003. See what's in our latest issue