Usually when a new company takes over a rail franchise they will announce all the good stuff first and then bad news and cutbacks are normally sneaked in gradually in the hope that no one notices. Virgin have a reputation for doing things differently, and although they only own 10% of Virgin Trains East Coast, they've shown that they have an innovative approach to rewarding their most frequent passengers. Even before the takeover they've announced major cutbacks to the benefits their customers get. A lot of people were annoyed at the devaluation of the British Airways Avios scheme, but the cuts to East Coast Rewards are a whole lot worse
See: East Coast Rewards v Nectar for details about how everyone will be worse off
In a reply written to one of our supporters, the MD of Virgin Trains East Coast, David Horne, said the following:
Nectar has been carefully chosen to ensure we can provide the opportunity for everyone to benefit from travelling with us, whether they are regular travellers or our one-off leisure customers. Clearly there are many occasional customers who already hold Nectar cards and who will appreciate the benefit of being able to earn "loyalty" points without having to go over the extra hurdle of signing up to the East Coast Rewards scheme.
Let's address these points:
The 'hurdle' of signing up to East Coast Rewards is ticking a box on the registration page, or if you've registered already going into your account page and ticking a box. If you're booking through this website you need to register, if you use the website from next month you'd need to register too. Digging out your Nectar card and typing in the number is more of a hurdle than ticking a single box to sign up.
The figures I've published show that NO ONE benefits from Nectar. The minimum spend to earn a free ticket is currently £255 (or £170 in first class), that is for a standard class single ticket on any route served by East Coast. If we assume such ticket costs £25 (an estimate on the low side) you'd need to spend £2500 to earn that 'free' ticket. Things get worse of the higher spenders, the ones whose custom they're trying to retain. Currently four first class singles are available for £1565 standard class spend (£1044 first class). If each first class ticket was worth £50 this would mean you'd have to spend £20000 with Nectar to earn the same reward. Please remember as there's no fixed points value to redeem with Nectar the actual amount is based on the ticket price, for fairness we're assuming low ticket prices, in reality you'd be paying even more. For example if those 4 first class tickets were £51 each the amount you'd need to spend would rise from £20000 to £20400.
What about the extra partners?
Some point out that the number of partners Nectar has makes earning easier. It's worth noting that the largest Nectar partner, Sainsbury's, is halving earning in stores from 11 April 2015 which means that it'd take twice the spend compared to the figures above if you were relying on Sainsbury's to top up your spend. In the end even if you do shop enough in other Nectar partners to continue to be able to enjoy free travel you'll still be worse off. If you spend £4000 a year in Sainsbury's and £1000 a year on East Coast you'd currently have 4 free standard class tickets (or 2 first class) and £40 worth of Nectar to put towards your shopping. Combined in the new scheme you'd have £50 worth of Nectar points but no free tickets. The free tickets alone were worth more than the points were. So when the two schemes were separate you had 4 tickets (worth at least £100 total) plus £40 of Nectar points, with the schemes combined you just have £50 of Nectar points. But as Sainsbury's are devaluing from 11 April from that point your £4000 annual shop will only earn £20 of points and so altogether you'd have only £30 of points.
About Save East Coast Rewards
Save East Coast Rewards was created in the hope that we could convince the new operators of the East Coast franchise that the existing loyalty scheme was worth keeping. It would have been better if they had made slight adjustments to the scheme if they were worried about profitability rather than abolish it completely. The site will remain for the purpose of showing customers that they're getting a poor deal. Our request to Virgin Trains East Coast was simple - put the introduction of Nectar on hold until you had the opportunity to survey existing members. They claim to have conducted research, but we've yet to find a single person that they've questioned.
Recently we have heard from a significant number of our supporters saying that CrossCountry trains (part of the Arriva group) are currently surveying their customers asking their opinions on an Arriva-wide loyalty scheme. It looks like they're doing everything that we asked Virgin to do. It's good that some rail companies still want to listen to their customers.
About East Coast Rewards
The current East Coast Rewards scheme dates back to 2011, but there's been a loyalty scheme on the East Coast Mainline since the days of GNER. All the previous operators of the route: GNER, National Express and East Coast had embraced the loyalty schemes as a way of increasing custom and also making their customers feel more rewarded.
In it's current incarnation East Coast Rewards is the UK's most generous loyalty scheme, if the new owners thought it was too generous it would have been better cutting back on some of the benefits rather than abolishing the scheme completely. Unfortunately Nectar is not a scheme fit of purpose, there's a reason that loyalty schemes like British Airways Executive Club and Virgin Atlantic Flying Club don't follow the Nectar model, you have to feel the rewards are achievable. Under Nectar very few will earn enough to enjoy a first class journey, something the current scheme allowed users to treat themselves to.
According to the 2014 Directly Operated Railways annual report more than 587,000 members had signed up for East Coast Rewards and by now that number has probably risen. The scheme was well used and appreciated.