The madness continues …. Iberia’s ‘90,000 Avios points for £200’ ends tonight. Let’s do the maths.

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In all of the years I’ve been running Head for Points, I don’t think I’ve ever seen a deal get as much attention – globally – as the Iberia ‘90,000 Avios for booking 10 flights you don’t need to fly’ offer this weekend.

We’ve certainly had good Tesco Direct deals in the past which were more generous, such as 2,400 Avios (1,000 Clubcard points) for a £10 printer ink which you could resell on eBay. These were glitches and got no attention outside the UK. This deal is NOT a mistake – Iberia has been keen to tell us that! – and it is getting huge amounts of traction across the world.

You can book the Iberia deal here if you still want to jump in or find out more.

To summarise:

You get 9,000 Avios for every Iberia, Iberia Express or Air Nostrum flight you book by 11pm UK time on Sunday
You can earn up to 90,000 Avios per Iberia Plus account
You must book on iberia.com
Your booking must include your Iberia Plus frequent flyer number
Your 9,000 bonus Avios will arrive within 10 days
Iberia has confirmed that you do not have to take the flights – you won’t lose the Avios if you don’t
One-way flights work fine

So …. if you can find 10 cheap one-way flights on iberia.com for €25 each (Santander to or from Madrid still had availability at that price last night, obviously prices are lowest in Winter) then you are getting 90,000 Avios cheaply.

There are restrictions on using these Avios and I STRONGLY recommend reading my article from yesterday here before booking.

Let’s put the deal in context

I am guessing that between 50,000 and 100,000 seats will be booked under this promotion. If you think that sounds high, remember that it only requires 5,000 to 10,000 people to book their full quota to hit that number. You also need to remember that non-UK frequent flyer sites have been going crazy over this deal too – virtually all of them, I have to say, giving less focus to the potential downside risks than we have.

What would 100,000 booked seats mean?

Iberia Group carries 85,000 passengers per day, so this equates to over one full day of passenger numbers

If you assume all of the bookings are for Q4 2018 and Q1 2019, as that is when fares are cheapest, it will add 0.6% to Iberia’s load factor for those two quarters (management bonuses all round)

If Iberia pays 0.75p per Avios to Avios Group (which is my best guess) then it will have to hand over £6,750,000 to AGL

Assuming an average ticket price of £20, Iberia will therefore lose £4,750,000, albeit IAG overall sees no loss

The promotion seems to have wiped out every single Iberia seat priced at under €20 for the next 12 months, and a large proportion of those priced under €25

Iberia will see a disproportionately high number of ‘no shows’ over the next year which could have a longer term impact on planning as they will lose track of the ‘genuine’ no show rate which is how they decide how much they can oversell a flight

It is all very odd and, frankly, probably beyond anything that Iberia thought would happen. There will be some interesting discussions in Madrid on Monday. Iberia cannot realistically go back on the deal, however, given that it briefed various websites including Head for Points on Friday about how the offer worked.

You can book via the special offer page here if you still want to give it a go before 11pm tonight.

How to earn Avios points from UK credit cards

How to earn Avios from UK credit cards (December 2021)

As a reminder, there are various ways of earning Avios points from UK credit cards. Many cards also have generous sign-up bonuses!

There are two official British Airways American Express cards with attractive sign-up bonuses:

British Airways BA Amex American Express card

British Airways American Express

5,000 Avios for signing up, no annual fee and an Economy 2-4-1 voucher for spending ….. Read our full review

British Airways BA Premium Plus American Express Amex credit card

British Airways American Express Premium Plus

25,000 Avios and the UK’s most valuable credit card perk – the 2-4-1 companion voucher Read our full review

You can also get generous sign-up bonuses by applying for American Express cards which earn Membership Rewards points, such as:

American Express Preferred Rewards Gold

Your best beginner’s card – 20,000 points, FREE for a year & two airport lounge passes Read our full review

The Platinum Card from American Express

30,000 points and an unbeatable set of travel benefits – for a fee Read our full review

Run your own business?

We recommend Capital On Tap for limited companies. You earn 1 Avios per £1 which is impressive for a Visa card, along with a sign-up bonus worth 10,500 Avios:

Capital On Tap Business Rewards Visa

The most generous Avios Visa or Mastercard for a limited company Read our full review

You should also consider the British Airways Accelerating Business credit card. This is open to sole traders as well as limited companies and has a 30,000 Avios sign-up bonus:

British Airways Accelerating Business American Express

30,000 Avios sign-up bonus – plus annual bonuses of up to 30,000 Avios Read our full review

Click here to read our detailed summary of all UK credit cards which earn Avios. This includes both personal and small business cards.

(Want to earn more Avios? Click here to visit our home page for our latest articles on earning and spending your Avios points and click here to see how to earn more Avios this month from offers and promotions.)

Category

Iberia and Iberia Plus

This article is closed to new posts. Discussion continues in the HfP Forums.

Devin says:

24 Jun24 June 09:00

Does Iberia metal fly anywhere from London besides Madrid?
- Rob says:
  
  24 Jun24 June 09:22
  
  No. Iberia Express used to, not sure if it still does.
- AndyR says:
  
  24 Jun24 June 11:52
  
  I think Iberia Express still fly to Asturias, Gran Canaria, Palma de Mallorca from LHR.
Steve says:

24 Jun24 June 09:07

Hmm just noticed in my Miles&More account 1 mile added the other day, labelled as Miles Protection. Any idea what this is?
- Rob says:
  
  24 Jun24 June 09:18
  
  I got this. I am GUESSING they are giving it to credit card holders to keep their accounts alive.
  - Steve says:
    
    24 Jun24 June 09:45
    
    For how long though?
  - RussellH says:
    
    24 Jun24 June 13:07
    
    I got it too. Five days after getting 8 miles on my LH Amex and 18 days after getting 4 miles on my LH Visa. Currently have 11 849 miles and 100 pending…
Doug M says:

24 Jun24 June 09:13

What will be interesting is how the Avios are handled IT wise. Will they be able to claw back negative balances from the account they were moved to, assuming moving them is possible and they’re not locked in somehow. Will these be ‘tagged’ Avios, not available for hotels or cars, which must have a real cost outside of IAG. They must have some confidence in controlling them, assuming a real IB account they have to use these Avios first against overal balance, whilst possibly adding in new Avios, they can’t just use LIFO as that would still reduce added Avios ahead if these. Either they’ve serious confidence in how they’ll operate this, or they’ll be facing months of IT hassle and customer complaints.
I only had an IB account following advice from here and the possibility of a lower tax redemption. To be safe I emptied it ahead of the fun and games to come.
Hoover?
Felix says:

24 Jun24 June 09:14

On the homepage it allows me to book until 20 Jun but on the offer page it says I can only book up to 330 days from today. Is there a catch here? or just an error
(it also doesn’t allow me to book 1/5/2019 on the offer page, which falls in the 330 days period…)
B R says:

24 Jun24 June 09:20

Group psychology is fascinating – we’re seeing the situation now where people are seeing other people apparently get something and are piling in to try and get the same or more, “signing up the dog” to an account. Also I think known as the “widows and orphans” phase where caution goes to the wind and everyone jumps onboard. What is happening now is that people are starting to ignore the “website bookings only” part of the T&C and the regional restrictions, and the fact that new accounts don’t really have an IB number for 72 hours, and going in for multiple accounts which starts multiplying up the 28 euros into quite large amounts of money. Voices suggesting a measured and cautious approach are shouted down too.

What will happen next? Not good for the consumers one way or another. Scenario 1 is that IB had a masterplan to limit exposure, and that will cut in. Most likely this is around some form of redemption restriction, strict transfer controls, or devaluation (or combination of the three).

Scenario 2 is that this was marketing driven, and the rest of the business leadership is on a weekend. Marketing departments may be patting themselves on the back at going massively viral and the sales numbers shooting skywards, but in the cold light of Monday morning when the Finance team gets in I would expect a few crisis meetings. In this scenario, there are essentially 10 days to limit damage. This will be a hastily constructed version of (1), but the following considerations are true:

1) PR damage is less damaging than balance sheet damage. There is the potential for this to have a serious balance sheet impact (I think the numbers in the article are probably underestimated). That conditions the way Iberia would approach the issues.

2) The first thing that will be looked at is strict T&C – Amazingly Iberia didn’t insert an “abuse” clause in the T&C and in fact were at pains to encourage “abuse” (multiple purchases without an intention to travel), so this will be difficult, but the most obvious clause is the “must use by Dec 1” and to prohibit transfer outside (or make the points dissolve if transferred). They have 10 days to create an IT solution to this problem but it’s a one line of code job to prohibit all transfers for a while to buy a little time.

3) Other T&C that can be applied are “website bookings only” and “must have a valid IB number at time of booking”. The latter may exclude a lot of pets.

Note that the value of the Avios is effectively reduced by restricting redemptions, and the “destroyed” avios on 1st December (conveniently within the second half of the financial year) is refunded from the Avios group, thereby disappearing from the balance sheet. Avios redemptions are intrinsically limited anyway, so if it is impossible to use these elsewhere, it’s a nice sleight of hand to boost the first half results using leprechaun gold.

In either scenario, consumers aren’t getting what they might expect from 90,000 avios. Money only has value if you can spend it. Personally I think the speed of the reassurances on Friday evening tends to confirm the belief that there is some risk management behind it, i.e. we are in scenario (1) rather than (2) but it’s controlled.

I don’t want to be a killjoy voice of doom, and I have skin in the game as I’ve taken a few flights on – albeit not the cheaper ones, I’m doing a few round trips to Madrid and a little tour via Seville for a weekend. But I’ve seen these feeding frenzies before and they rarely end up well.
- Devin says:
  
  24 Jun24 June 10:19
  
  I have a hard time believing that this type of offer would not have required senior management approval, and surely senior management in the avios/marketing/it departments would have predicted a similar outcome. (maybe not some people opening lots of fake accounts, but certainly real people booking cheap flights with no intention of travel). Therefore I would agree that they must have some sort of strategy. The T&C of this offer were so limited that IB will have some difficulty restricting based on those, but they could always change the T&C’s of the Iberia plus at any point, something like “avios earned during a promotion can only be used to fly on Iberia”?
  
  Where does this 72 hours come from? I signed up my partner on Friday evening and had an IB number instantly. I did have difficulty booking initially, but 72 hours to propagate throughout the back-end systems is not the same as not having an IB number.
  - Rob says:
    
    24 Jun24 June 12:04
    
    Look at the Virgin Money insurance deal. Someone signed that off too. Just someone not very smart in the ways of how loyalty schemes work.
    - Devin says:
      
      24 Jun24 June 14:43
      
      True, but that was a much smaller giveaway and takeup and still pulled relatively quickly. This is a huge giveaway and seen enough interest to crash the site multiple times. They must be aware by now of what is happening and are still allowing it to continue.
- marcw says:
  
  24 Jun24 June 10:31
  
  IbPlus team has been working for a time on this promotions. Some details of the promotion got leaked a few weeks ago. Obviously, no one believed it at that time, but once it went on-lin, god hell, yes, it was all true.
  
  The marketing team is behind this interesting promo.
Andy says:

24 Jun24 June 09:21

I haven’t had a look on the Iberia site but is there an option to transfer points out to Avios.com? My account is still open and I can’t do them direct to BA because it’s a family account.
JT says:

24 Jun24 June 09:22

It smells like Avios devaluation is coming !
Frenzie says:

24 Jun24 June 09:30

Hello Rob,
You said that it is not possible to transfer these bonus avioses to BAEC Household account.
I have just transferred 400 avios from Iberia to BAEC household account using avios.com .
- Lumma says:
  
  24 Jun24 June 09:59
  
  He was saying that the closure of the avios.com accounts is imminent and you might not have the option later to do so
- Rob says:
  
  24 Jun24 June 12:09
  
  You can do it via avios.com but that won’t exist in 4 weeks. It will presumably still be done via Aer Club and Vueling Club.