On Friday 3rd July the Virgin Trains East Coast MD, David Horne, was interviewed by Jonathan Cowap on BBC Radio York. The interview was to review VTECs first four months of running the East Coast service and covered a variety of issues, including rewards. It was an interesting interview in many ways, David was grilled both by the presenter and another caller also called David on the Rewards issue.
As expected he could not come up with a good justification for introducing the Nectar scheme, he mentioned that it was the most popular scheme in the UK but could not explain why this mattered to the frequent traveller. One thing we've noticed is that he often uses the numbers of people who have registered their Nectar number with Virgin Trains East Coast as proof that the scheme is popular. Our montioring of Twitter indicates otherwise, those we've spoken to prefer East Coast Rewards but some have chosen to claim Nectar points simply because they're better than nothing.
Our feeling is that David Horne is not convinced of the value of Nectar either but has to defend a decision that was made before he was appointed. Unfortunately when you look at the figures Nectar is worse whether you're an occasional, medium or frequent traveller. Anyone who spent more than £50 on East Coast within two years was better off with East Coast Rewards and I don't think the priority should be attracting those who can't even spend £50 over a prolonged period of time.
The numbers game
Early in the interview David said one of the drawbacks of East Coast Rewards was it didn't have many members, as we had discovered there were over 671,000 members in January 2015, up from 587,000 in the 2014 financial report. The scheme had been quick to grow from its launch in late 2011 and had over 230,000 members by February 2012. Later on in the show he says that over 160,000 customers that have chosen to collect Nectar points through Virgin Trains East Coast. Considering that Nectar was marketed heavily to the 671,000 Rewards members in the run up to the switchover, it was also marketed to the millions of Nectar cardholders it's clear that the uptake of Nectar is poorer than the initial uptake of East Coast Rewards.
If you currently have Nectar linked to your Virgin Trains East Coast profile, we recommend you remove it so that they can't claim that you're in favour of the scheme. If you do still want to collect Nectar points you're better off booking through a FirstGroup website such as First Great Western as First give Nectar points for all rail travel, not just their own. On the other hand Virgin Trains East Coast won't even give you points on Virgin West Coast services (but First do!)
A franchise commitment, but more to come
David Horne says that Nectar was part of the franchise agreement and it would be difficult to go back on this. He also mentioned there'd be a package of other benefits coming up but failed to go into other details of this. We have heard that an early promise of providing additional benefits to their frequent travellers is still in the pipeline and we hope to hear more soon. We will keep an eye on developements and hope that we can get your feedback heard.
It's an insult
One thing the caller was clear to emphasize was the Nectar offer was an insult to their most loyal customers. Why is it taken so negatively when it had a generally positive reception with First Group and Virgin Trains West Coast? We examined @VirginTrains and @FGW Twitter accounts from the dates that they respectively launched Nectar and although there wasn't an overwhelming response the positives outweighed the negatives. On the other hand once East Coast announced the Virgin plans to introduce Nectar the feedback has been overwhelmingly negative, even now the positive feedback on Twitter is still in single figures. Every time a new update was sent out about Nectar, Save East Coast Rewards gained a new batch of Twitter followers.
Nectar is poor, but why is it considered an insult? All the marketing for Nectar tried to convince us that Nectar was a good thing, the first issue of the Red Report they described Nectar as "a truly rewarding experience", more recent ads suggest Nectar can "make sweeter journeys" and the Nectar website says "travelling by train has never been more rewarding". It's this marketing that makes people feel insulted. We had a great scheme, that was appreciated by thousands and so not happy if we're constantly reminded about its inferior replacement particularly when trying to give the impression that it's better.
Even the largest Nectar partner, Sainsbury's, now gives Nectar a low profile, on their homepage it's relegated to a small link at the bottom and there's very little mention of it in most stores. Hopefully Virgin Trains East Coast will realise if Nectar has to stay because of their franchise commitment they'll at least stop heavily promoting it as a better option. It hasn't been a successful tactic so far and just annoys those frequent travellers that remember when things were better.
We agree with David, the caller, when he says he's happy with the running of the franchise so far except for the decision to scrap East Coast Rewards. David Horne has a lot of experience, we like that fact that he's easily reachable by Twitter and the crews we've talked to are feeling optimistic about the future (when National Express took over from GNER morale took a nosedive very quickly). We've shown that we can be a significant voice in raising awareness about East Coast Rewards, it's also important that we ensure standards are maintained, and hopefully improved, in other areas of the operation whether it's the on-board service, in the stations or the lounges. We'll give praise when it is due and also let them know if we think they're slipping.
We can be fairly sure that if they'd kept Rewards or had announced a new scheme that provided some benefits to travellers before launch most people would consider the transition to Vrigin Trains East Coast had gone well. We're sure that the franchise bid team probably realised not everyone would be happy with the switch to Nectar but they probably underestimated how many people would be angry and also probably significantly overestimated those who would be happy. No doubt the bid team assumed that those who were unhappy would send their complaints and then give up.
It's important if you haven't yet give your opinion on Nectar that you do so, the How to Help section of our website tells you what to do. It's important for Virgin Trains East Coast to receive as much feedback as possible.
Now they've had a chance to settle into the franchise and collate the early feedback let's hope that they can come up with something that rewards their loyal travellers. We're happy and willing to provide feedback on any ideas they're willing to share with us in the hope of being able to shape their future offering. The second issue of their Red Report is due out in August so hopefully there will be improvements to be announced by that time, although we believe that this is long overdue, and they have really let down season ticket holders by not doing something sooner for them.
You can listen to this interview on BBC iPlayer until the end of July 2015. The interview starts at 1 hr 7 mins into the programme and David's comments about Rewards start just after 1 hr 30 mins into the show.