Over the past month, we’ve seen plenty of coverage of the new Amtrak Guest Rewards program:
- The New Amtrak Guest Rewards Program: Who Benefits? Who Doesn’t?
- What does the new Amtrak Guest Rewards Devaluation Mean for You?
- Amtrak Routes You Should Take Prior to the Devaluation
- The New Amtrak Guest Rewards Credit Card is a Real Winner!
I had a chance to chat with Vicky Radke, Senior Director, Amtrak Guest Rewards to ask some questions regarding the new program, and was sent answers. I’ll highlight these questions below, as well as some of my thoughts.
What was the motivation for the Amtrak team to change the AGR program to a revenue-based model? Was this influenced by airline loyalty programs?
A guiding principle for our team was to simplify the program to drive greater member participation and engagement. We recognized that over the years, some elements of our program had become overly complicated and we really wanted to emphasize an easy-to-participate structure to attract new customers and new members to the program.
On the earning side, members will continue to earn two points per dollar spent on Amtrak travel—as they have since program inception 15 years ago. Amtrak Guest Rewards was well ahead of the airlines and an industry leader in tying point earning and ticket price, recognizing that this was a more accurate reflection of customer value and loyalty than distance travelled. In the new program we will align points needed to redeem for Amtrak travel with ticket price and eliminate the zone maps and charts that determined redemption cost. Members will now earn and redeem points for travel in the same manner, which we believe will drive greater participation and engagement.
What were the complaints of the “old” Amtrak program?
Some of our most frequent travelers—those who purchase Amtrak multi-ride tickets and monthly passes—have expressed a desire to use their points for these types of tickets, which today is not available. We are pleased to introduce redemptions for multi-ride tickets and monthly passes as one of our expanded redemption options of the new program.
Also, when a customer explores travel on Amtrak.com today, there’s a separate booking path for a redemption trip and limits on award trips that can be booked online. In January, members will be able to toggle between points and dollars as they shop for their trip on Amtrak.com. Plus, members will be able to use points to book any trip including those with sleeping accommodations or Auto Train, which currently requires a customer service agent.
In your research, how many customers redeemed for last minute travel whereby the older fixed point system would have been cheaper than the new price based system?
After analyzing thousands of redemption scenarios, we saw that our members use their points to redeem Amtrak travel over a wide spectrum of lead times–from those that are planning far ahead to book that family vacation to those redeeming for a reward trip within a few hours of departure. Looking ahead, we expect our members will continue to utilize their points in a variety of ways and will continue to recognize the strong value of their Amtrak Guest Rewards points. The exciting news is that our new approach to redemption will lower the point cost for many trips with our lowest trip costing just 800 points. This provides a more attainable reward level for many of our customers.
What has the feedback been like so far for the “new” program?
We are encouraged by the initial feedback we’ve received since announcing the new program. Members are excited that we have eliminated blackout dates, removed Acela time-of-day restrictions on redemptions and lowered redemption minimums. Members are also eager to explore the points + cash option when it is introduced next year and are pleased we’ve expanded ways to keep their account active (any qualifying transaction—earning or redeeming—within three years).
How many routes (and percentage of total routes) does Amtrak see the point redemption cost going down with the new price based model?
Our point redemption minimum for Amtrak travel will be lower on all routes. Specifically:
· On all routes (with the exception of Acela) the minimum points needed for reward travel will start at 800 points. Currently our redemption minimum starts at 1,500 points
· On Acela, the minimum is lowered from 8,000 points to 4,000 points. This will allow more members the opportunity to redeem for Acela for city pairs that in the past would have required twice the points.
What will some typical points and cash redemptions look like? Will these cash and points redemptions still earn tier points for those working towards Amtrak elite status?
The redemption process will be fully integrated into Amtrak.com, including our new points + cash feature. Members will select their itinerary and then be able to toggle between points and cash on the same screen. This will allow the customer to choose the option that best fits their needs. As is the case today, redemption travel will not count towards earning tier status.
Amtrak is now instituting a 10% non-refundable points “fee” for canceled tickets within 24 hours, or 10% if there’s a lower fare adjustment prior if changing trains. Did Amtrak find lots of people were canceling or changing tickets to warrant this change?
The new cancelation policy for redemption travel—set to take effect on January 24, 2016—is intended to align the redemption travel policies more closely with the revenue cancelation policy.
How will the purchase of sleeping car tickets that occupy 2, 3 or 4 people be handled? Will that be the price displayed online, or will there be a per-person fee?
The price in points for sleeper car travel will be based on the total dollar cost of the reservation, which can be found online at Amtrak.com. There are no additional fees associated for redemptions on sleepers.
After receiving these initial questions, I followed up with some additional clarification questions, hoping to get additional insight. Some of my initial questions that I asked weren’t answered, so I re-asked those questions, too.
Will Amtrak Guest Rewards continue to partner with Chase Ultimate Rewards so consumers can transfer points in?
If you have an eligible Chase Card with Ultimate Rewards, you can continue to transfer points to Amtrak Guest Rewards until further notice. We plan to have more information soon.
What percentage (or numbers) of customers in the loyalty program are Select, Select Plus and Select Executive?
This information is proprietary.
How many routes (and percentage of total routes) does Amtrak see the point redemption cost increasing with the new price based model?
Under Amtrak’s current rewards program, travel is based on three geographical zones: Eastern, Central and Western. The Eastern zone also has a Northeast subzone. There is a published chart of points necessary to travel in each class of service within or across zones. We also have a group of “special routes” for which we allow a lower cost to redeem, unless one is connecting to a non-special route, which would then make it a zone trip.
However, regular Amtrak tickets are determined quite differently and, like our competitors, vary according to demand and other factors. This difference in cost determination with the current program created a situation where one flat point rate for a zone redemption trip would allow for some trips to have terrific value in points, while others would have lesser value. By tying the point cost to the actual fare, the improved Amtrak Guest Rewards program is creating consistent value for members. Plus, by lowering the minimum points needed for a redemption, we are actually lowering the cost to redeem for many trips.
My Thoughts: I am concerned at the vagueness of this answer, since the actual number or percentage of routes that are increasing was not provided.
Can Vicky provide examples of cash and points redemptions? What are some typical prices/routes along with their corresponding cash and points amounts?
Amtrak created the points estimator and published it on our website to encourage members to explore and understand the new program’s many options. Members will be able to shop around for the best fares when using their points, similarly to how they might book when paying cash.
My Thoughts: Despite my question, still the cash and points redemption examples were not provided. The calculator on their website does not show cash and points redemptions.
What will the redemption costs be for multi-ride and monthly passes?
The cost to purchase a monthly or multi-ride pass varies based on the city pair purchased. This is one of the reasons why we were not able to offer passes as a redemption item in the current program. In January, members will be able to use points to purchase these passes and the cost will be based on the price of the pass.
Regarding the percentage of routes/train where the point redemption cost going down, the only thing responded was that the minimum cost of travel would be going down. However, since Amtrak knows how many folks are redeeming and for what cost, what is the percentage of routes and trains where Amtrak sees the point redemption cost going down? While the minimum redemption cost may be going down, that doesn’t necessarily mean what the average consumer will pay, especially considering they cannot redeem at the ultra-saver level.
Some members who typically redeemed for a trip that was an exceptionally good value in points, or for some with lesser value, may see a difference in the cost to redeem.
As from the question above, how many routes and trains will see the redemption cost increasing, based upon the history Amtrak knows about how folks traveling Amtrak redeem?
This information is proprietary.
In one of my original questions I asked, “In your research, how many customers redeemed for last minute travel whereby the older fixed point system would have been cheaper than the new price based system?” The reply said that customers redeem over a variety of times, however didn’t answer how many customers (or percentage) out of the sampling of “thousands of redemption scenarios” did consumers book last minute travel, where, in a majority of cases, the cost of points necessary will increase because the ticket price has increased, thereby being better under the old model.
Some members may alter their booking habits in an effort to optimize the value of their points. They may begin their search for fares earlier and consider choosing a departure that has a lower fare available. Other members who are less concerned about the point cost and desire more flexibility, will be pleased to find that they now have the option to book during what used to be blackout dates or times.
My thoughts: In this response, I didn’t actually receive a number or percentage of the amount of tickets booked last-minute.
Overall, I think many of these responses were generic and an overview from a “30,000 foot view” and didn’t actually delve into the specifics I was asking. I get the sense that many details are still to be confirmed or determined, and that the amount of redemptions requiring higher point values may actually be going up. Of course, if they were going down, I think Amtrak would tout that as a value of their new program, but unfortunately that did not come across in this messaging, thus my original thinking.
I’m happy Amtrak was open enough to receive these questions and appreciate their time in helping to provide these answers.
What are your thoughts on the responses provided by Amtrak on their new program?
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