Rix and I were having a chat after Tiger launched its Avalon base last November and, with our talk going well, I thought I would turn to a thorny and much-despised issue: Tiger’s Stripes program.
Much like Spirit Airlines’ $9 fare club, with Stripes you pay an annual membership fee of A$29 (for Spirit it’s US$59) and in return get first dibs on sales with the pitch being that you’ll recoup the membership fee in fare specials.
This did not go down well with the public, especially once some made the mistake of calling Stripes a frequent flyer programme, as Rix knows all too well.
“I don’t know why people criticise it. It’s strange, really,” Rix begins.
Stripes, he continues, “is simply about getting to ahead of the queue for the best deals. At the moment it’s 24 hours but it could be 36 hours or 48 hours.”
“We are the choice of students. We are the choice of the smart guys. They figure us out,” Rix says.
“People can take it or leave it, and they’re taking it in droves,” Rix says. “It’s very popular and we’re pleasantly surprised.”
Would he disclose membership numbers?
“Oh not yet. Oh no, no no, I wouldn’t do that.”
Rix says he expects the majority of members will recover the $29 fee in their first purchase . “If you’re first in the queue for a $9.99 or $19.99 fare and it goes up to $49, there you go.”
“The vast majority will recover [the membership fee] in the first round [of bookings]. Certainly in two or three flights you can recover it,” Rix bets.
So then how does Tiger make money?
First, Tiger spends little on administration. “Why would we have cost? We’re not about adding cost. It’s a simple programme–very easy,” Rix says.
Second, Tiger may not be offering lower fares than it has previously. What has changed is that it makes it previously public sales only accessible to its members. Now that Tiger has been in the Australian market for nearly three years, people know about its sales and, the reckoning may go, be willing to plonk $29 for the sale fares previously accessible to everyone.
That’s only my take because I’m not a Stripes member, which Rix isn’t pleased to hear about.
“For $29, c’mon,” he says. “Who has to be cynical about $30?”
Okay, Rix. I’ll try out Stripes and report back here with my impressions.