Airlines, with the hotel industry close on their heels, pioneered the modern loyalty program, so it’s fitting that both have been the focus of recent news. Airline, travel and hospitality rewards programs, like much of the loyalty industry, find themselves at a critical junction. With two Deloitte reports – one on airline loyalty and the other on hotels – indicating lackluster engagement, brand fickleness and mounting consumer frustration, it’s as if the airline, travel and hospitality industries have been given a challenge. How do they re-invigorate customer engagement and long-term loyalty?
Encouragingly, brands within these sectors – along with third-party loyalty program providers – are meeting these challenges head-on. Rather than feed the perception of themselves as verticals forever dialing back rewards or making higher tiers more difficult to reach, the airline, travel and hospitality industries are re-writing that narrative. Through their efforts, brands are discovering:
• The evolving importance of Big Data and coalition loyalty programs. How can airline and hotel partnerships embrace omnichannel tenets that offer more personalized experiences? Big Data analysis is also being used to help airlines cut costs by finding minute inefficiencies. Once corrected, savings can be used to augment new loyalty initiatives.
• The need for airlines (and hotels) to adopt a tiered, omnichannel loyalty strategy that combines tangible and status-based rewards and allows them to be transferred between programs. American Airlines and its AAdvantage frequent-flyer program is an excellent example of this. The program lets members redeem their miles with most of its partners as well as give miles as gifts or to charity. They also have the ability to bid on exclusive VIP experiences such as plush outings to high-profile sporting events, awards shows and more.
• The re-popularization of SoLoMo (social, local, mobile) – especially as it relates to hotel guest engagement. To loyalty marketers who thought they knew what SoLoMo stood for: think again. Spelled out as Social, Local, Mobile, too often the ‘Lo’ in SoLoMo is thought of as a strictly location-based initiative. But thinking in those narrow terms fails to consider a vital and valuable subset of hotel guests: locals.
These trends – and additional insights – are what the Kobie Quarterly Review: Airline, Travel and Hospitality edition is all about. We hope the Kobie Quarterly Review: Airline, Travel and Hospitality Edition broadens your appreciation for what loyalty programs entail and the genuineness they seek to deliver. Airline and hotel loyalty programs may have encountered some customer engagement difficulties of late. But thanks to its long and robust history, no industry is better equipped to confront and rise above these challenges.