Consumer finance industry analysts have given the thumbs up to the Qantas Frequent Flyer and Woolworths loyalty program alliance, saying it has benefits for members of both programs.

For members of the Woolworths Everyday Rewards program, it provides a significant expansion of available rewards. For Qantas Frequent Flyer members, it provides an opportunity to earn points at a much faster rate.

Qantas Frequent Flyer and Woolworths announced plans to create a loyalty program alliance in December. On June 1, they spelled out the details. Under the terms of the deal, Woolworths customers will be able to link their Everyday Rewards accounts to the Qantas Frequent Flyer program, and vice versa.

Members will earn one Frequent Flyer point for every dollar spent above $30 in one transaction. Customers who link their Everyday Rewards and Frequent Flyer membership accounts, and pay for their purchases with a credit card that earns Frequent Flyer points, will earn points on their card's program and on their Everyday Rewards program.

It is important to note the alliance does not involve the Woolworths Everyday Money credit card, which was launched last year.

It will be available to Woolworths Supermarket and Woolworths Liquor customers from June 22 and Big W customers from July 16.

The offer will be extended to customers of BWS, Dick Smith and Caltex Woolworths petrol stations in the next few months.

The four-cents-a-litre fuel discount will remain in place.

An analyst at Canstar Cannex, Peter Arnold, says the Woolworths program is a good-value shopping voucher scheme. Canstar Cannex rates such programs on the value of vouchers that can be redeemed for given levels of spending.

In its most recent ratings, published in April, the group gave Woolworths Everyday Money Rewards a five-star rating (the top rating) for all three spending tiers in its survey $12,000, $24,000 and $60,000 a year.

Arnold says cash-back offers and vouchers are popular. They allow consumers to earn rewards quickly and give them discounts on day-to-day items.

He says Canstar Cannex looks at the "breadth" of day-to-day spending the vouchers encompass. A shopper should expect to receive about $105 worth of vouchers for every $12,000 spent, $249 of vouchers for every $24,000 spent and $780 for every $60,000 spent.

Arnold says the Woolworths program had a narrow focus on rewards and members could only get vouchers for goods at Woolworths Group stores. But the deal with Qantas Frequent Flyer overcomes that problem.

The Frequent Flyer program offers more than airline tickets; it includes a Qantas Store that offers non-flight rewards and vouchers.

The principal of credit card research group MWE Consulting, Mike Ebstein, says the alliance is good for Frequent Flyer members because it broadens their range of options for earning points.

"You want to make it easy for your members to earn points and that is what Qantas has done," he says. "For Woolworths, there is potential to attract new shoppers. The other advantage for Woolies is that it gives its program diversity, which will appeal to consumers."

Both Woolworths and Qantas Frequent Flyer have been making aggressive moves to beef up their loyalty programs and other financial service offerings in the past year.

The group's general manager of customer engagement, Richard Umbers, says there are 3 million Everyday Rewards members.

Woolworths followed up in August with the launch of the Everyday Money credit card in a joint venture with HSBC. The company has not reported its credit card numbers.

Industry sources say the take-up of the credit card has been low. There is a perception the rewards package is weak because points expire quickly and distribution has not been managed well.

The chief executive of Qantas Frequent Flyer, Simon Hickey, says that scheme had 5.6 million members. One million people came aboard earlier this year as part of its move to a so-called "direct earn" rewards system. Hickey says he is aiming for membership to build to 7 million during the next 12 months, largely through the Woolworths alliance.

The move to direct earn was initiated last year when Frequent Flyer announced it wanted to deal directly with participants in its program rather than through credit card issuers. Under arrangements in place at the time, cardholders earned points in their card issuer's program and elected to have some or all of them transferred into their Frequent Flyer account.

Frequent Flyer felt this arrangement lacked transparency and created a situation where conversion rates varied from one card issuer to another.

Under the direct earn system, participants who earn points on their spending will accrue frequent flyer points directly. Card issuers have made changes to their cards or launched new cards that allow Frequent Flyer members to deal directly with Qantas.

The program received a high rating from MWE Consulting in a comparison published earlier this year. MWE found the program "offers the greatest potential shopping voucher and travel rewards for almost all consumers who travel and use a credit card. This is due to the strong earn and redeem proposition and the competitive partner network."

MWE says travellers who use expensive fully flexible fares on long flights will do better on Velocity and Skywards (the Emirates program) but Qantas Frequent Flyer is better for most users when considering flight rewards. MWE says: "Qantas has the broadest overall scope and number of reward partners.

"The domestic and international flight options available through Qantas and the affiliated OneWorld partners is considered the broadest."