Isracard vs. CAL: The Fine Print of Airline Clubs and Which Card Gets You to a Flight Fastest
The transfer of the Fly Card credit card from CAL to Isracard, announced last March, has sparked a full-scale battle in the industry. As Moshe Morgenshtern, CEO of El Al’s frequent flyer program, the club to which the card belongs, told Globes, "We caused an earthquake that turned into a volcano." ● The fight escalates, El Al accuses CAL of "consumer fraud" ● Fly Card CEO on the competitors, "An imitation from AliExpress"
Some 550,000 customers hold a Fly Card, and Morgenshtern’s goal is one million cards. The competitors, of course, did not remain idle. After the high-profile move, CAL launched a new points club for flights called FlyAll, in partnership with Issta. The new club includes several credit cards that provide a range of additional benefits, including cashback. A few days ago the company announced that on the first day of the card’s launch, 10,000 customers had already joined. At the same time, smaller players also entered the picture, MAX launched SkyMAX, and Bank Hapoalim’s international bank is promoting BEYOND. Israir and Rami Levy also accelerated their activity in the field, with the option to accumulate points on Levy’s credit card for redemption with the airline.
On the face of it, these are measures intended to benefit consumers, but in practice the result is growing confusion among consumers as the options on the market multiply. What should you know about the new cards, what benefits do they offer consumers, and which is the most worthwhile in the end, using points toward your next vacation abroad? Globes breaks it down.
How much do you earn, and how much does it cost?
Each company’s goal is for its credit card to be the first one a person pulls out of their wallet when making any purchase. To make that happen, a payment must have value beyond the specific purchase. That is why, in the current competition, one of the most prominent issues in the two strong clubs, Fly Card and FlyAll, is the amount of accumulation offered to consumers who use the cards.
With monthly transactions averaging NIS 5,000, FlyAll users will receive NIS 600 in cashback. Premium holders will receive a higher cashback of NIS 720. By comparison, SkyMAX and Beyond offer an annual rebate of NIS 375.
The picture with Fly Card is different, since these are not cashback cards in the classic sense that convert accumulated points into shekels. Here, points and diamonds are accumulated for the purchase of an El Al flight ticket, status upgrades on a flight, class upgrades, lounge access, and discounts on baggage, across four card tiers. In addition, the consumer can redeem points at 50% off on Tuesdays and on birthdays.
It should also be noted that last week Isracard launched TimeOff, a service that allows hotel bookings, attractions, insurance, car rentals, e-SIMs and more, which enables the company to expand the value proposition for Fly Card holders beyond El Al.
The question troubling many Fly Card holders now is what will happen to their accumulated points. Isracard says that all points will be transferred to the new card, by ID number, including status and benefits. As for card fees, FlyAll offers a first-year exemption from payment, while Fly Card costs NIS 19.9, but a second card gets a 50% discount.
One of each side’s goals is to attract new customers, so the sign-up bonus has also become a competitive arena. On FlyAll, the bonus currently stands at $250, while on Fly Card it is up to 5,000 points for accumulation. According to Isracard, Fly Card can optionally reach the value of a flight ticket every four months. According to CAL, it is less than a year, subject to the monthly purchase volume. In both cases, the intention is not tickets to the United States at Passover, but cheaper and closer ones.
Who is flying with whom?
Who can benefit from the various credit-card platforms? CAL’s FlyAll cards are open to the entire public, as is Fly Card’s frequent flyer program, while SkyMAX is restricted to MAX customers and Beyond is restricted to holders of the International Bank’s bank-issued card.
What is important to take into account is which airline you prefer, for those interested in El Al, the Fly Card card is preferable, while those interested in flying with foreign airlines should choose FlyAll. All the cards provide their customers with additional benefits beyond the credit-card perks. For example, FlyAll cards allow access to the ASPIRE lounge at Ben Gurion Airport, along with benefits such as vouchers redeemable in CAL’s online experience store.
With Fly Card, there is the option of accelerated point accumulation when using the card at businesses such as Sonol, Shlomo SIXT, a range of hotels and more. In any case, points remain valid on FlyAll for 24 months, and on Fly Card for 18 months.
The advertising battle
This week we published an exclusive report in Globes stating that El Al accuses its former partner, CAL, of "consumer fraud." In a warning letter sent to CAL CEO Yafit Greiani, El Al claims that the credit-card company is violating the terms of the agreement between the sides as well as the law. Among other things, the letter refers to claims of "false, misleading and harmful statements."
In the El Al frequent flyer club, they argue that contrary to the understandings, according to which "the parties undertook in the amendment document to continue operating the agreement and continue operating the existing Fly Card cards," CAL launched a campaign for the new club, which constitutes a breach of contract. They also claim that this amounts to "deceiving the public, improper comparison between the various club cards, false advertising and unlawful exploitation of accumulated reputation."
CAL said in response that "FlyAll offers Israeli consumers a new, simple and transparent value proposition... El Al’s warning letter is a direct continuation of the attempt to create fear and deterrence instead of competing through a better value proposition for consumers."
What is this about? The heated competition between the sides has also reached commercial breaks, digital media and billboards. More than once, advertising for the two cards has appeared in adjacent placements, physically, for example לאורך Ayalon highways, and on television, where the commercials are aired one after the other.
For each side, this is a major financial investment of millions of shekels, intended to attract customers to the "right" side. In Fly Card, they first chose to replace the presenters, NBA player Deni Avdija and "Tehran" star Niv Sultan were selected for the task, instead of Aviv Alush and Marina Maximilian Blumin. On Saturday night, the first new commercial aired, through the peach advertising agency of Eyal Saada and Sharal Danir from GITAM BBDO.
In addition, the club recruited a new array of "ambassadors," including familiar names such as Yael Shelbia, Dana Frider and Yael Goldman, alongside influencers such as Sapir Avisror, Liel Eli, Kevin Rubin and others, who will carry out social-media activity.
At FlyAll, CAL’s regular presenter, Gal Malka, received support from stand-up comedian Matan Peretz, who plays the indecisive character, the one who asks all the questions of the confused customer. So far, two videos have gone live, in several variations, through the Manch agency, characterized by a confrontational style alongside concrete data. The goal, it seems, is to build the brand while emphasizing information about the new product.
CAL’s campaign led Isracard to create a video that was not planned in advance, and consists of textual clarifications about the competitor’s offer. "It is reminiscent of the mobile-phone battles of the past, both sides are in war-room mode, because this is very significant for them," says an industry source. "In marketing, it is customary that the leading player is not supposed to respond to its competitor, whereas Fly Card came out with headline-style video, which may indicate pressure on their side. Such competition can last for years, but now is the critical launch moment. By the end of the year, the battles will probably be even more intense, and then these will already be two legitimate competitors."
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