East Coast Rewards had closed completely on 30 September 2015 which was the final day redemptions could be made. As our guide explained once you redeemed for free travel you had six months to book travel and travel could be three months ahead of booking meaning rewards travel was still available up until the end of June 2016. Added to the rewards travel Virgin Trains East Coast gave us an additional Christmas gift of free travel, unfortunately this has not been repeated this year, but it did mean that for the first half of 2016 there was still opportunities for free travel if you had amassed many points under the old East Coast Rewards scheme.
To celebrate the first anniversary of Virgin Trains East Coast we published a points calculator to show how worse off you were after a year of Nectar compared to what you would have earned if you had spent the same amount the previous year with East Coast. The calculator shows that even modest spenders were better off with East Coast Rewards.
Not much has visibly happened on the loyalty front in 2016, there's been a few extra points promotions with Nectar which didn't seem to generate any excitement on social media (although may have gained some curiosity from new customers who haven't considered the train before) and to a lesser extend Flying Club promotions. Virgin Red had a massive publicity push back in the summer offering the best prizes and offers in their short history. There's usually a 20% off Virgin Trains East Coast offer for new customers and occasionally higher offers for verified customers. The most recent sale was also promoted through Virgin Red.
One change for first class lounge users was the £5 surcharge charged to those with advance tickets to use the Kings Cross lounge has now being abolished meaning that entry is available complimentary to all first class ticket holders, also all the First Class lounges that were operated by VTEC have been refurbished in a Virgin style and additional seating is provided. The lounge at King's Cross can be very overcrowded on a Friday evening but is pleasant at other times.
The main incentive added this year for standard class ticket holders to book tickets direct is free WiFi. If you book a trip that is all or in part on VTEC you will get a WiFi code for each passenger if you book on virgintrainseastcoast.com - unfortunately some passengers book on virgintrains.co.uk and although there's a redirect to the East Coast website it only works in certain scenarios.
Season ticket holders continue to wait for a significant benefits package, although from a business perspective it can be understandable why they're not a high priority to be rewarded (they tend to be a captive audience) providing the right incentives can encourage people to use the train for leisure travel as well as creating a more positive perception of the brand. I believe the ability to book season tickets online is in the pipeline and from that point forward it will be easier to provide benefits to season ticket holders, unfortunately like many IT projects the launch has been delayed.
The other category of people who used to be rewarded but are no longer are those customers who have to book their business travel through an agency. Currently I'm not aware of any developments on this front but I've noticed that Virgin Trains East Coast seem to be working more closely with thetrainline (the last two sales were also available via thetrainline as well as the VTEC site) and as they handle business travel for a lot of companies they could work on some arrangement to resurrect business rewards.
Interestingly Virgin Trains West Coast customers also rated their rewards scheme poor and customers would like a scheme that sounds much like East Coast Rewards, this was interesting because the west coast never had a scheme like East Coast Rewards and when they introduced Nectar nothing was taken away from them (the 'Traveller' scheme for high value passengers remained).
There's a lot of potential areas for improvement in 2017 but I doubt anything will be put in place until the IT upgrades are completed. The key for a good loyalty scheme is to attract new customers, retain existing customers and also encourage existing customers to either travel more or upgrade their travel making them a more valued customer. It also makes sense to encourage customers to book direct not just to save paying commission to a third party but also so you can analyse the customer behaviour.
One of the key campaigns in 2016 was 'Plane Relief' which offered £15 tickets (£30 first class) between Edinburgh (and other stations within the catchment area of EDI) and London for those who usually fly, giving them the chance to experience train travel at low price. If this promotion is run again I suggest that anyone who booked a 'plane relief' ticket and suffered serious disruption should be given an additional free ticket on top of delay repay this will mean if they have a bad experience they will be able to give the railway a second chance.
As British Airways are scrapping complimentary catering on domestic flights this is another opportunity to highlight the superior complimentary catering offering available on the train in first class. I think promotions trying to get people to switch from plane to train should also target Newcastle as well as Edinburgh. British Airways have a monopoly on flights on the Newcastle to London route and despite high prices have always been busy on the services I've used. A large portion of those leaving the aircraft at Heathrow head to the exit rather than flight connections meaning they're doing a point to point flight rather than connecting to a longhaul flight. The ideal time to promote rail travel to Newcastle and Edinburgh passengers would be shortly after the complimentary catering has stopped. British Airways has announced the intention to introduce their Club Europe product on domestic flights but have yet to announce a date for it. Club Europe is their shorthaul business class product so once it's launched those willing to pay business class fares will once again be able to get complimentary catering this is why it'd make sense for VTEC to take action in the period between the scrapping of complimentary catering for all and the indroduction of Club Europe on domestics.
After the 'Plane Relief' promotion was over VTEC sent out email to customers who had signed up and had not used their discounted tickets (although an error meant these were also sent out to some people who did use their discount) directing them to a questionaire asking why they didn't take advantage of the VTEC offer. It asked why they considered flying better but it did not offer 'frequent flyer schemes' as one of the options for someone preferring to fly. The popularity of sites such as Flyertalk and Head for Points shows there's a significant minority that base their travel choices either on the status benefits they can get with frequent flying or the ability to earn miles/Avios to spend on future travel.
From a loyalty perspective, regular BA travellers on the UK domestic routes are entitled to the following benefits once they reach silver status in the British Airways Executive Club:
- Lounge access - this includes complimentary alcohol as well as hot food at Heathrow and sandwiches/soup in the regional airports
- Fast track security at most airports
- Free seat selection at time of booking (on most fares)
- Free additional bag (except on hand baggage only fares)
- Priority boarding
These benefits can turn flying from being a chore into a reasonable experience. The amount of time in the air is smaller than the time on the train and the lounge makes it easy to work or relax.
Even easyJet, which isn't widely known for having a loyalty scheme, has 'Flight Club' for frequent travellers. The main benefit of this scheme is you can make changes to your bookings fee-free which will be beneficial to business passengers when plans change suddenly. easyJet also has a membership scheme called easyJet Plus which gives you access to priority seat selection, fast track security and speedy boarding for an annual fee which works out at good value for the frequent traveller.
From March Flybe will be operating services from Aberdeen and Edinburgh to London Heathrow T2, this is in addition to their current services to London City Airport. I don't think this will have a significant impact on VTEC although the competition may result in lower prices on the Edinburgh - Heathrow route. Just like BA, it will be possible to earn Avios on the Flybe flights.
Ideas for VTEC
For season ticket holders it may be worth looking back at GNER365 which was a scheme for annual standard class ticket holders. Benefits included things that would be useful to season tickets holders such as a number of complimentary upgrade vouchers, catering vouchers, discounts on leisure first tickets and the occasional free first class travel ticket. Offering some freebies such as this would improve satisfaction and offering discounts on first class travel would encourage customers to use VTEC for weekend breaks.
The Virgin Trains West Coast survey showed the majority wanted a loyalty scheme that was points based and had visible targets. Currently most recognition at VTEC is done on a 'surprise and delight' basis. I think there's room for both, if you get a free ticket out of the blue or an upgrade offer it makes you feel valued but it can't be used as a way to encourage new business and there's a risk of losing customers if a competitor comes up with a scheme with more generous defined benefits.
The biggest drawback with the current Nectar and Flying Club schemes is you can't use your points to purchase rail related items, we don't need to worry about WiFi anymore as that's included but some of our supporters who have to travel standard class for work appreciated the ability to buy a lounge pass so they can relax before travelling. Unfortunately now there's no way for someone who has to travel standard class by company policy to gain access to the lounges, but if they are a frequent BA flyer they can get access at the airport even on the cheapest tickets. It would also be good to be able to use points to pay for upgrades and catering vouchers.
- Have a tier based system which will unlock benefits based on VTEC spend in a pre-defined period. Benefits could include the ability to buy a certain number of rewards tickets with points (i.e. you can use a fixed number of points to purchase a rewards ticket) - having a minimum spend to activate this feature would stop new customers spending all their points earned from other sources on free travel. Other benefits could include access to priority customer services once a higher tier has been reached (British Airways has such a tier called 'Gold Guest List') which will deal with delay repay claims and general queries faster and allow a small number of fee free changes/cancellations each year for the highest value customers
- Trial the purchase of lounge passes for points, see if it makes overcrowding worse or are they generally used at quieter times
- Make it possible to pay for sale fares with Nectar/Flying Club eVouchers (last time I checked it was not possible to pay for sale fares with these vouchers as only 'Advance' tickets counted) - this would be separate to the tier based benefit and would be open to all at normal redemption rates
- Offer proactive upgrade offers when a customer is travelling standard class on a relatively quiet service, make it possible to pay for the upgrade offer with points or cash. As British Airways has learned it's important to not make the upgrade offers predictable as offering it on every quiet service will mean customers will book the cheapest fare knowing there's a good chance of an upgrade. Therefore it's important that these offers do not appear too frequently for the same customer as getting the balance wrong would decrease the chances the customer would book first class in the future
- Work with tourist organisations in the areas served by VTEC to encourage more leisure travel particularly the less known 'hidden gems' like Alnmouth and Berwick. Run promotions targeting these lesser known destinations
- If there's a particularly quiet weekend run a same day flash sale where people willing to travel immediately can get a bargain. Let's encourage spontaneous day trips if the trains are not busy!
- Car parking in VTEC managed stations - most already have a better rate on the weekend, a pre-book online service (guaranteeing a space) would give those travelling on a weekend break confidence that they'd get a parking space, a pay by points option for weekend parking could also be offered
The key is to give regular customers something to aim for while throwing in some surprises to generate loyalty and goodwill. Then convince potential customers to switch from other modes of transport as well as create the incentive to make additional trips to visit places on the ECML.