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Example of Setting Up Redemption Pricing Using Base Redemption Promotions

This topic gives one example of setting up airline pricing using the base redemption promotion design. You might use this feature differently, depending on your business model.

NOTE:  The functionality described in this topic requires that you install Siebel CRM Release 8.1.1.10 or later. For information, see the applicable Siebel Maintenance Release Guide on My Oracle Support.

It is most common to set up redemption pricing using pricing rules, as described in Defining the Static Redemption Price for Flight Products and Defining the Static Redemption Price for Nonflight Products. To define more complex pricing, you can use base redemption promotions, as described in this example.

This example describes a flight redemption, but base redemption promotions can also be used for nonflight redemptions.

In this example, the base promotion gives the base redemption price to members based on external factor such as revenue associated with ticket. Additional promotions in the promotion design apply discounts to this base price that depend on the member's tier: base members get a 5% discount, silver members get a 10% discount, gold members get a 20% discount, and platinum members get a 30% discount and additional 10% discount based on booking channel. Members have the option of using only points or using points plus pay to get the redemption product. This base redemption promotion design is applicable only to members who are more than 18 years old and are US citizens.

To set up this example, perform the following high-level steps:

1. Define the redemption product that represents the particular flight that this pricing applies to. For more information, see Process of Setting Up Airline Flight Redemptions.

   As part of the process of setting up redemption pricing, you associate the redemption product with a partner, and when you do this, you must select Base Promotion in the Pricing Method field. For more information, see Associating the Flight Redemption Product with a Program Partner.

2. Set up the transient variable (optional).

   When you create a new non-qualifying point type in the given program to be used for redemption, a transient variable is automatically created aligning with this point type. However, if the point type already exists and you want to create a transient variable for this point type, then you must do the following:

   1. Navigate to the Program screen, Program Level Attributes, then the Transient Attributes view.
   2. Create a new transient attribute.
   3. Align this transient attribute to the given point type and give it a default value of zero.
3. Define the base redemption promotion for the product.
   1. Create the Promotion record, and select the promotion Designer Availability checkbox and the Base checkbox.
   2. Create the first rule in the base promotion, which simulates all the price options available for the member, including Points and Points plus (+) Pay.
      • Create the criteria for this rule, which include 1) ticket revenue (gotten from the transaction amount) multiplied by 1000 to get base points, 2) product name, and 3) can include other criteria (such as the partner name, if the same product is offered by more than one partner with different pricing).
      • Create the action for this rule. The action type is Redeem points, for the appropriate type of points and number of points.
      • Create a second action of the type Redeem Points plus (+) Pay, with both a point type and value and a currency value.
      • If tickets can be purchased using multiple currencies, then create additional actions of the type Redeem Points plus (+) Pay, with the point type and value and currency values using the other currencies.
      • Create separate rules for each product and partner. This is required because the same promotion design applies to the entire product and partner category.
   3. Create the next rules in the base promotion, which set the base price based on the price option the member selects. There must be separate rules for payment mode equals points and for payment mode equals Points plus (+) Pay. If there are multiple currency options, then there must be a rule for payment mode equals Points plus (+) Pay with each available transaction currency.
      • These rules have criteria to check the payment mode.
      • Other criteria might include product or partner. There must be separate rules for each combination of product and partner that the promotion applies to. (Criteria for product and partner is recommended for partners and product which have same partner and product category respectively, because a promotion design will contain a single base promotion that is applied for all the redemption offerings for this product-partner combination.)
      • The actions are Redeem Points or Redeem Points plus (+) Pay, depending on the payment mode.
4. Create the next promotion, which gives members a discount based on the member tier.
   1. Create the first rule of this promotion.
      • The rule has criteria to check that the value of Member Tier equals Base Member.
      • The rule has actions of the type Discount Points and Discount Points plus (+) Pay, which give a discount of 5%.
   2. Create the second rule of this promotion.
      • The rule has criteria to check that the value of Member Tier equals Silver Member.
      • The rule has actions of the type Discount Points and Discount Points plus (+) Pay, which give a discount of 10%.
   3. Create the third rule of this promotion.
      • The rule has criteria to check that the value of Member Tier equals Gold Member.
      • The rule has actions of the type Discount Points and Discount Points plus (+) Pay, which give a discount of 20%.
   4. Create the fourth rule of this promotion.
      • The rule has criteria to check that the value of Member Tier equals Platinum Member.
      • The rule has actions of the type Discount Points and Discount Points plus (+) Pay, which give a discount of 30%.
5. Create the next promotion, which gives members a discount based on booking channel.
   1. Create the rule of this promotion.
      • The rule has criteria to check that the value of Booking Channel equals Web.
      • The rule has actions of the type Discount Points and Discount Points plus (+) Pay, which give a discount of 10%.
6. Create an eligibility promotion to check for members who are US citizens and are more than 18 years old.
7. Add all these promotions to a flow chart so they are executed in the proper sequence:
   1. Create the promotion design. Give it a name and start and end dates. Select Redemption Product as the apply-to. In addition, select the appropriate product category and partner category.
   2. Add the Start object.
   3. Add the Eligibility Promotion object, and select the eligibility promotion you created.
   4. Add the Base Redemption Promotion object, and select the base promotion you created.
   5. Add the Promotion object, and select the promotion you created to give members a discount based on member tier.
   6. Add the Promotion object, and select the promotion you created to give members a discount based on booking channel.
   7. Add the End object.
   8. Validate the promotion design by clicking the Validate button.
   9. When the validate status is green, activate the promotion design.

      For more information about working with Promotion Designer, see Using Promotion Designer.