Why you should never redeem frequent flyer points for products

One of Australia’s leading frequent flyer experts has crunched the numbers to reveal the true cost of some of the most popular consumer products when they are bought with points. The verdict? Always redeem frequent flyer points for flights.

Point Hacks (pointhacks.com.au), an independent platform that brings together one of Australia’s biggest active communities of airline rewards experts, analysed the cost in points of nine popular products on both the Qantas Shopping and Velocity eStore websites against the cost in points of six popular flights. The findings reveal that the per-point values of the products were up to six times more than the per-point values of the flights – confirming that flights remain the best-value redemptions to redeem frequent flyer points.

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All of the products analysed – from a gift card, to a Breville toaster and Gold Coast hotel accommodation (full table below) – have a point value of 0.3-0.64 cents per point when redeeming through the rewards programs’ e-stores. In contrast, all of the flights analysed – from Melbourne-Sydney Economy and Business Class, to Sydney-LA Economy and Business Class – have a point value of 0.58 to 4.7 cents per point.

Product redemptions are considered low value, according to frequent flyer expert and Point Hacks’ spokesperson, Daniel Sciberras. “Redeeming points on products generally aren’t good value compared with flights, especially long-haul international flights in premium cabins. You should be looking for at least 2 cents per dollar for an ideal redemption value and this isn’t something you are likely to get with products. Most of them fall between 0.4 to 0.8 cents, while flights are between 1.5 to 14 cents per point.”

Daniel says that, although the general rule followed by point hackers is not to redeem points on products at all, there are times where it might be of good value. “For instance, when your points are about to expire and you aren’t looking to fly anywhere soon, or for those who don’t particularly enjoy flying, my suggestion is to purchase products when they are on sale in airline rewards e-stores, where you will use at least 35 per cent less points. For example, a Delsey trolley case and a DeLonghi Nespresso Machine can each cost almost half of their original price in points during a promotion period.”

Interestingly, the product that is most worthy of points is not a tangible one. A standard three-day car hire has the highest point-per-dollar value (excluding sale items) among all the other products in both Qantas Shopping and Velocity eStore.

Daniel adds: “Although the value per point between Qantas Shopping and Velocity e-Store is similar, overall, shoppers will likely get a better deal when purchasing products through Qantas Shopping, as six out of the nine products analysed have a higher cent-per-point value on that platform.”

For instance, a 32GB iPad costs 80,600 points on Qantas Shopping compared to 92,871 points on the Velocity eStore; Bose headphones cost 59,690 on Qantas Shopping Qantas and 67,763 on the Velocity eStore; and a Breville Bit More Plus 2 Slice Toaster requires 12,730 Qantas points, but 15,039 Velocity points.

Popular products and its dollar value compared to points value

Product	Retail dollar value	Total Qantas points required	Qantas point value	Total Velocity points required	Velocity point value
$50.00 Westfield Gift Card	$50.00	11,010	0.45c/pt	10,900	0.46c/pt
Delsey 68cm Montrouge 4-Wheel Expandable Trolley Case	$255.00	83,930	0.30c/pt	94,812	0.27c/pt
Sofitel Gold Coast 31 Dec 2019-1 Jan 2020 – Double or  Twin Classic	$404.40	96,416	0.42c/pt	93,700	0.43c/pt
Car Hire – 3 days – Standard	$191.16	30,000	0.64c/pt	26,900	0.71c/pt
iPad – WiFi 32GB	$469.00	80,600	0.58c/pt	92,871	0.51c/pt
Bose Soundlink Revolve       Speaker	$249.00	54,690	0.46c/pt	61,823	0.40c/pt
Breville Bit More Plus 2 Slice Toaster	$59.00	12,730	0.46c/pt	15,039	0.39c/pt
Bose Soundlink Around Ear Headphones II	$329.95	59,690	0.55c/pt	67,763	0.49c/pt
DeLonghi – Nespresso Citiz & Milk Coffee Machine	$269.00	47,600	0.57c/pt	69,772	0.39c/pt
Virgin Australia Sydney- Hong Kong economy flight	$727.94			55,600 + $253.96	0.85c/pt[1]
Virgin Australia Sydney- Hong Kong business class return flight[2]	$4,683.66			131,000 + $298.32	3.35c/pt
Qantas Melbourne-Sydney   economy return flight[3]	$575	16,000 + $74	3.13c/pt
Qantas Melbourne-Sydney business class return flight	$1,806	36,800 + $74	4.70c/pt
Qantas Sydney-LA economy return flight[4]	$1739	83,800 + $408	1.59c/pt
Qantas Sydney-LA business class return flight[5]	$8,829	216,800 + $718	3.74c/pt

[1] The value per point is calculated by taking the cash price and subtracting the taxes, and then dividing this subtotal by the total points required for redemption.

[2] The dates for the Virgin Australia Hong Kong flights are for immediate travel (ie, departing 1 day out and returning 3 days out), as Virgin only releases reward seats a number of days out from departure. 

[3] The Qantas Melbourne-Sydney flights are for immediate travel (ie departing 1 day out and returning 3 days out), but did the Qantas Sydney to Los Angeles flights for late May 2020, where more reward seats for Business might be available (before school holidays)

[4] The Qantas Sydney-LA flights are for late May 2020, where more reward seats for Business might be available (pre the school holidays).

[5] Ibid.Redeem frequent flyer points