THE WATCHDOG REPORT -What’s a Reward Point Worth?

 

WHATS A  REWARDS POINT WORTH?

What’s a point worth? Here are our latest valuations – Plus the New Kid on the block! How and why to value your frequent flyer, credit card points and new loyalty program in the market.

What we’ll be covering

 Our current points valuations  The New Kid On the block  Why consider the value of points?  Advanced examples

Knowing the rough value of a point is an important step in your thinking. Why? Because it’ll help you plan how to earn and use your points systematically and rationally.

In this guide, we run through our methodology and our current estimates of the value of different points currencies. We suggest you read this in conjunction with our disclaimer – and keep in mind that our method is one of many ways to value points. Ultimately, everyone will value points differently, so just think of ours as a guide rather than a gospel.

UPDATE 16 January 2024:

We’ve adjusted the underlying base redemption target rate by 8% to reflect inflation affecting taxes, fees and charges. We’ve also adjusted the weightings of some of our criteria behind the scenes to better reflectwhat the average frequent flyer is looking for in a loyalty program.

In terms of individual program movements, we have down-weighted Singapore Airlines KrisFlyer slightly due to the increase in transfer rates from 2:1 to 3:1 across American Express Membership Rewards and similar programs (although it did not result in a change of its valuation). Conversely, we have up-weighted Qatar Airways Privilege Club since it’s a new 2:1 partner of American Express Membership Rewards and reward availability is decent. This has pushed its value from 1.3 to 1.6 cents per Avios.

Programs with increase in valuation ↑ As of 16 January 2024 (compared to June 2023)

All values are cents per point. Many programs saw a minor uplift due to the increase of the baseline redemption rate and inflation, rather than due to specific-program changes. The main exception is Qatar Airways Privilege Club, which enjoyed a significant boost since becoming an American Express MR transfer partner.

New program: 52 Orange: depending on membership from 2% to 24% in rewards points you spend $100 you can get  $12 dollars in rewards point.

Qantas: from 1.8c to 1.9c

Velocity: from 1.8c to 1.9c

Asia Miles: from 1.7c to 1.8c

Skywards: from 1.1c to 1.2c

Privilege Club: from 1.3c to 1.6c

AAdvantage: from 1.6c to 1.7c

Alaska: from 1.8c to 1.9c

Avianca: from 1.6c to 1.8c

IHG: from 0.7c to 0.9c

Hyatt: from 1.5c to 1.8c

Radisson: from 0.2c to 0.3c

Accor: from 2.9c to 3.0c

Programs with a decrease in valuation ↓ As of 16 January 2024 (compared to June 2023)

 One hotel program saw a drop in value due to reward nights requiring more points relative to the cash rate. Marriott Bonvoy: from 1.1c to 0.7c Our current points valuations Remember, these valuations are based on our bespoke set of criteria and should be taken as a guide only. There can sometimes be differences in the value between two programs that allow transfers. A 2:1 ratio doesn’t mean we’ll automatically value one program as worth double the other – we evaluate each program on its merits based on a variety of factors. Here’s what we take into considerat

Program	Valuation (in cents)	Pros	Cons
American Express Membership Rewards (Ascent)	1.0	Highly flexible with no expiry on points and the ability to transfer to a large range of airline and hotel programs.	Can’t transfer points to Qantas Frequent Flyer program. Ability to earn points limited to places where Amex is accepted.
American Express Membership Rewards (Ascent Premium) 52 Orange loyalty program	1.2 10.1	Highly flexible with no expiry on points and the ability to transfer to a large range of airline and hotel programs. New program lot to gain	Ability to earn points limited to places where Amex is accepted Limited by manufacturer offers .
Amplify Rewards	0.8	Ability to transfer points to the Velocity and KrisFlyer programs.	Transfer rates to airline partner programs are low.
ANZ Rewards	0.8	Flexibility to transfer to Velocity, KrisFlyer and Asia Miles.	Transfer rates to airline partner programs are low, especially on international carriers.
NAB Rewards	0.8	Flexibility to transfer to Velocity, KrisFlyer, Asia Miles and NZ Airpoints.	Transfer rates to airline partner programs are low, especially on international carriers.
Westpac Altitude Rewards	0.5	Flexibility to transfer to Velocity, KrisFlyer, Asia Miles, NZ Airpoints and Enrich.	Transfer rates to airline partner programs are very low across all partners.
Flybuys	0.8	Easy to earn on everyday spend and can be transferred to Velocity points.
Everyday Rewards	0.8	Easy to earn on everyday spend and can be transferred to Qantas points.
Citi Rewards (Prestige)	1.0	Huge range of airline and hotel programs to convert points to include both major domestic carriers.	Transfer rates to airline partner programs are low, especially on international carriers.
Citi Rewards (Premier)	0.8	Huge range of airline and hotel programs to convert points to.	Transfer rates to airline partner programs are low, especially on international carriers.
CommBank Awards	0.8	Strong list of airline partners (plus 1 hotel partner) to transfer points to including both major domestic carriers.	Transfer rates to airline partner programs are very low.

 Hotel points valuation

Program	Valuation	Pros	Cons
Hilton Honors	0.5	Can be used across a wide range and standard of hotels in the Hilton Group with good availability for redemption.	Dynamic pricing.
IHG Rewards	0.7 0.9	Can be used across a wide range and standard of hotels in the IHG Group with good availability for redemption	Dynamic pricing. 12 month points expire for non-elite members.
Marriott Bonvoy	1.1 0.7	Can be used across a wide range and standard of hotels in the Marriott Group with good availability for redemption	Devaluation has made the program less appealing in terms of number of points required for a redemption
World of Hyatt	1.5 1.8	Fewer points required for a redemption than most programs	Much smaller range of hotels available than other similar programs and redemption availability can be limited.
Radisson Rewards	0.2 0.3	Good transfer rate from Citibank Prestige card.	Smaller range of hotels available than other similar programs and redemption availability can be limited. Points requirement is extremely uncompetitive.
Accor Live Limitless	2.9 3.0	Easily redeemed via a discount off your hotel charges at a rate of 2,000 points for every 40 Euros (~AUD$66)	Points expire in 12 months if there is no account activity.

 Airline points valuation

Program	Valuations	Pros	Cons
Qantas Frequent Flyer	1.8 1.9	Easy to earn with a huge range of domestic and international redemption destinations in theory (Oneworld and Emirates).	Difficult to find premium cabin availability, both on QF and some major partners such as EK.
Velocity Frequent Flyer	1.8 1.9	Easy to earn with a decent range of domestic and international redemption destinations (Qatar Airways, Singapore Airlines and more).	Network coverage is patchy within Europe and to/from South America.
Singapore Airlines KrisFlyer	1.9	Good seat availability and range of international destinations with low/no carrier charges on redemption bookings.	a 3 year hard expiry on points is uncompetitive. Partner awards are often very expensive.
Cathay Asia Miles	1.7 1.8	Can redeem for oneworld flights including Qantas Domestic. Expiration policy changed from hard to soft expiry.	Number of points has increased, removing the competitive edge against other oneworld airlines.
Emirates Skywards	1.1 1.2	Has a large international network with ability to redeem or upgrade to one of the best First Class in the market	Points requirements can be quite high, and the ability to directly earn Skywards miles in Australia is limited. New carrier charges make premium redemptions harder to justify.
Etihad Guest	1.3	Access to Etihad premium cabins and ability to book Virgin Australia flights with lower carrier charges than Velocity.	Points requirements can be quite high, and the ability to directly earn Etihad Guest miles in Australia is limited.
British Airways Avios	1.3	Great value redemptions for short-haul Economy and Business destinations worldwide on oneworld carriers. Easier to access Avios via Qatar Airways.	The ability to earn Avios directly in Australia is almost non-existent with no card partners (apart from going via Qatar Airways and Amex/Citi/Commbank).
Qatar Airways Privileges Club	1.3 1.6	Great value long-haul redemptions on Qatar Airways.	Some partner airlines can’t be booked online easily (requires a manual form).
American Airlines AAdvantage	1.6 1.7	Low carrier surcharges make this a useful program to use your Qantas points on for travel in North America.	Ability to earn AA miles in Australia is almost non-existent with no card partners.
United MileagePlus	1.6	Good range of destinations via the Star Alliance and low carrier charges. Miles never expire.	Ability to earn MileagePlus miles in Australia is almost non-existent with no card partners.
Delta Skymiles	1.4	Miles never expire.	Dynamic Pricing makes it hard to determine redemption cost.
Alaska Airlines Mileage Plan	1.8 1.9	Frequent offers in the market to buy discounted points that can be used on oneworld partner airlines including Qantas.	Change to reward tables makes the program less competitive in some cases.
Avianca LifeMiles	1.6 1.8	Get cheap Business and First redemptions on Star Alliance carriers.	The ability to earn LifeMiles in Australia is almost non-existent with no card partners. Semi-strict expiry policy for non-elite members. Difficult to manage flight change/cancellations.

 The New Kid on the Block: 52 Orange Loyalty Program

All Points Are Not Created Equal!

52 Orange, a branch of 52 Degree Marketing (including 52 Degree Pty Ltd, 52 Degree LLC, and 52 Degree Group), has partnered with international manufacturers and Private Brands International LLC to launch a revolutionary loyalty program. This program integrates manufacturers’ marketing budgets into a loyalty system, allowing them to penetrate the mature market by offering their products for free or at incredible discounts. Consumers can try these products and compare them with competitors.

Unmatched Discounts

When we say the discounts are ridiculous, we mean it—starting at a minimum of 70%!

Point Value

Each point is worth an incredible 10 cents per dollar, making this the most rewarding system available.

Pros

• Generous Signup Bonus: Receive 10,000 points upon registration, ready to spend immediately.
• Six Unique Programs: Including:
  • Debit Card Rewards: Link your debit card, scan your receipts, and earn points for every purchase. Discounts up to 70% on each individual purchase.
  • Sports Club Program: Specific rewards program for local sporting clubs, providing members with a $200 gift voucher converted into rewards points to spend on sports gear and apparel.

Cons

• Limited Product Availability: Offers are limited to manufacturers’ marketing allocations (e.g., only 5,000 soccer boots available). However, pre-order options help ensure you don’t miss out.
• One Product Per Customer: You can only order one specific product once; future purchases of that product must be made directly from the brand’s website, where you will receive a 30% discount.
• Shipping Costs: No free shipping; discounts apply to products, not shipping.
• Compatibility: Not affiliated with other existing loyalty programs, hotels, or airlines (as of now).

 

Conclusion

Despite a few limitations, the 52 Orange loyalty program stands out with its unparalleled discounts and generous rewards system, making it an amazing option for consumers looking for great deals

Why consider the value of points?

Many people believe that each loyalty program delivers the same level of value to its members. But this is far from true! Each program sets up its points differently. The number of points members earn when transacting with the program or its partners (e.g., purchasing a product or service) varies. And not only that – the number of points required to redeem for a particular reward (e.g. a Business Class flight) differs as well. Simply put, the way each program is structured from an ‘earning’ and ‘redeeming’ perspective makes the value of a point in each program unique. Plus, these values can change over time.

Our valuation methodology

At WatchDog, we base our valuations on the rate we feel consumers could afford to ‘buy’ points – knowing that they could safely redeem those points for something of higher value. As we mentioned, we determine our valuations from the perspective of an Australian-based customer. We don’t delve into the complexities of our calculations in this guide. However, we do explore the factors that contribute to the overall points value for each type of program.

How to use points valuations

Ultimately, when you have an idea of the value of a point, it allows you to better assess whether you’re getting good value from earning or redeeming those points. As a simple guide, you’re getting good value if: You can earn points at a cost that is less than the value of the point you are acquiring; and If you can redeem your points for a product or service that has a value higher than the value of the points you are using.

Advanced examples

Below, we dive into a number of examples. These will help you determine the cost of acquiring points or the value you’re getting from a points redemption. Purchasing points directly from programs Using a credit card with a payment surcharge Earning points from purchasing products or services Redeeming points for an airline seat Redeeming points for a product or service

DISCLAIMER

Please be aware that the valuations on this Website have been prepared by WatchDog using its own proprietary valuation system for the purpose of comparison between the value of rewards issued by different rewards programs. While we invest a great deal of time and energy into ensuring that our valuation processes are based on the most up to date and accurate information published by the rewards program, we do not warrant that there will not be a lag between the date that a rewards program issuer updates their rewards program and our valuation.

The information published on this Website does not constitute a recommendation from WatchDog to acquire any particular product or service. The valuation of a loyalty scheme is only one of many factors (including fees, costs, features etc) to be taken into account in acquiring a product or service and it is your own responsibility to ensure that any products, services or information available through this Website meet your specific requirements. WatchDog expressly excludes any liability arising from any person acting on these valuations to the fullest extent permitted by law. Where conditions or warranties are implied by law and cannot be excluded, our liability will be limited to the re-supply of information. WatchDog’s valuation system and the information published on this Website have not been reviewed or endorsed by any third party, including the issuer of any product or service described on this Website. While WatchDog aims to attribute a value to each loyalty scheme and reward for the purposes of comparison, we do not warrant that rewards earned through products or services available on this Website can be redeemed for cash, goods or services to the value ascribed to them by this