I don't think East Coast Rewards, never mind Save East Coast Rewards has been mentioned in parliament before. Thanks to freedom of information legislation we've been able to get a picture of how East Coast Rewards helped grow the East Coast business. When asked by the MP for Leeds North West, Alex Sobel whether we had any information on the East Coast Rewards campaign and measures that proved its success, we were happy to help provide the information that we had.
Take a look at his speech to Parliament on the 23 May 2018 about how Rewards played a part in the failure of Virgin Trains East Coast (VTEC)
For those who are unaware of Save East Coast Rewards, it's worth reading our East Coast Rewards v Nectar page for details of how superior the East Coast scheme was and if you're an East Coast traveller have a look at our points calculator to see how worse off you are.
There have been some people in the press and public that try to say Stagecoach are blameless here. That they did everything they could to grow the business but where let down by the likes of Network Rail not delivering planned upgrade works and Hitachi not delivering the Azuma (class 800) as early as planned. The truth is any Network Rail upgrades were due to be completed in the future and have no impact on VTEC at the current time, although it may have affected future profitability.
Losing East Coast Rewards was the first example that showed that VTEC didn't really understand their market. Initially on-board they had still maintained the quality service inherited from East Coast and with some little tweaks like Hop on Board beer the initial thought was that VTEC were going to build on the success of East Coast and that introduction of Nectar was their only mistake.
A lot of thought had been put into the East Coast Rewards programme. A carefully costed business case was produced showing the expected return on investment that introducing the Rewards scheme would provide. The annual reports from Directly Operated Railways showed that the performance of East Coast Rewards exceeded the initial expectations.
Another benefit that East Coast Rewards provided was to help boost tourism to areas on the East Coast route. Many people used their free tickets to take additional leisure trips to other places on the East Coast route. When I first started getting free tickets I used them to try out places on the route I'd never visited before, sometimes taking a bike for a day cycling sometimes staying the weekend. I'm sure many others used their free tickets to visit somewhere new.
Unless someone at VTEC sends us the figures (feel free to contact us anonymously) we can't say for certain what the impact of removing East Coast Rewards was. We suspect that removing the scheme slowed down growth because while new promotions were attracting some new people others were exploring their other options.
Soon after VTEC launched Sainsbury's launched a 10x bonus points on fuel offer at their petrol stations and BP also launched a similar promotion. While this promotion was running it meant that driving was significantly more rewarding than taking the train. This is not the message VTEC should have been sending their passengers and it's a consequence of not having control of your loyalty scheme. The British Airways loyalty scheme was significantly more generous than Nectar, but wasn't as generous as East Coast Rewards so when Rewards closed it would make flying more tempting for those travelling between London and Newcastle or Edinburgh.
So if a poor loyalty scheme wasn't enough to put people off they started to decline on-board in 2017 just around the same time that British Airways introduced Club Europe (shorthaul business class) on their domestic flights, previously BA domestic flights were economy only.
- A significant change is what we like to call the Catering Lottery, although the majority of services still run with their advertised catering (in first class at least, in standard many don't run with a trolley) there's still a significant chance you'd not get the advertised catering (e.g. no hot food available), prior to the staff rota changes catering issues were extremely rare. Catering is more important the longer your trip, many people want to go straight from the office onto the train, when East Coast introduced complimentary catering in 2011 in first class it saw a significant increase of passengers book first class. When catering is not dependable it makes it less attractive.
- The highest spenders are taken for granted. The ones I've talked to have received nothing unless their spend significantly drops then they'll usually get a targeted offer. This matches my experience, spent over £6k in 2016 received nothing, reduced spend drastically in 2017 and I received a three month lounge pass!
- The new booking engine launched in 2017 has a number of issues including the inability to reserve cycles or easily modify tickets. This extra hassle could make booking less attractive. The app and ticket machines also have serious issues.
- Issues with maintenance meaning toilets (including the larger accessible toilets) go a while without repair. There's a number of sets go out each day with an accessible toilet out of action. This can put off people with disabilities travelling.
- They abolished the first class quiet coach recently, the email informing us about this claimed it was because they were listening and most people didn't want it.
They've also reduced the number of staff in stations meaning some ticket offices have had to close early due to short staffing, we try to announce these on our Twitter feed @SaveECRewards but can only do so when we're made aware of them. This is not information VTEC give out through official channels.
That's what I can think of for now, we're going to be thinking over the coming weeks how we can effectively work with LNER to make train travel more attractive, we hope they will make the effort to win over passengers who were loyal to East Coast but have decided to change their travel patterns because of VTEC.
We know it might not be possible for LNER to introduce a loyalty scheme from day one, the East Coast Rewards systems were decommissioned years ago and the booking platform now used is different. VTEC had the opportunity to adopt an excellent loyalty scheme and threw it away.
So their first issue should be maintenance - particularly the accessible toilets. Hiring more staff to reduce the staff shortages both on-board and at the station need to be looked at. Restoring the number of staff on-board will mean a more reliable catering option in first class and a trolley as well as Foodbar in standard class. At stations it will mean the ticket offices will be open their advertised hours and more people to assist in the peaks. This will help ensure the basics are right and those who choose to travel by train can depend on a good service on-board.
We're happy to work with LNER with any plans they do have for a loyalty scheme, we're happy to show them the figures we've collected from East Coast in the past to help justify the scheme.