LEAD SPONSORS

8 Big Reasons Why Loyalty Will
Transform the Customer Experience
Dan McKone
L.E.K. Consulting

© 2013 L.E.K...
Today’s travelers have a revised set of expectations for loyalty
programs
Yesterday’s
travelers’
expectations

Today’s
tra...
Loyalty programs are adapting
to a more sophisticated traveler
to provide a better, more
personalized customer
experience…...
8 big reasons why loyalty will transform the customer experience

o
1 Loyalty programs are increasingly integrated with ev...
1

Loyalty programs are increasingly integrated with everyday living
Hotel Points

Airline Miles
Earning
Options

Extendin...
Data analytics help identify chances to customize the guest journey

2

Guest journey

Preferred food &
drink made
availab...
Loyalty-data-driven segmentation can better match needs to guests
Business traveler segments

Food

Productivity Recogniti...
4

Customized optional services can change the guest experience
Archetypal guest travel experience

Need states occur
duri...
5

Personal recognition drives loyalty among the most valuable members

Recognize elite travelers…
Greet them by name

Cus...
6

Loyalty alliances enhance the loyalty reward incentive

“This enriches the experience for our most valuable travelers, ...
7

Experiential offerings can drive aspirational behavior in loyalty
Experience

Exclusivity

Free lounge
access

Super-el...
8

Feedback can be a powerful tool in enhancing a member’s experience

Real-time
feedback at
different points of
journey

...
Rich intelligence about the
journey means the experience
can (finally) be personalized!

© 2013 L.E.K. Consulting LLC. All...
LEAD SPONSORS

Closing slide
Question and Answers

© 2013 L.E.K. Consulting LLC. All rights reserved.

9th FFP Loyalty Con...
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8 Big Reasons Why Loyalty Will Transform the Customer Experience

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L.E.K.'s Dan McKone recently presented at the 9th FFP Loyalty Conference 2013 on loyalty transforming the customer experience. Here's his presentation.

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8 Big Reasons Why Loyalty Will Transform the Customer Experience

  1. 1. LEAD SPONSORS 8 Big Reasons Why Loyalty Will Transform the Customer Experience Dan McKone L.E.K. Consulting © 2013 L.E.K. Consulting LLC. All rights reserved. 9th FFP Loyalty Conference 2013
  2. 2. Today’s travelers have a revised set of expectations for loyalty programs Yesterday’s travelers’ expectations Today’s travelers’ expectations o Accustomed to standard offers o o Never given the chance to choose Expect programs to offer them options o Used to “one-size fits all” approach Value personalization and personal recognition o Want rewards that fit them o Active users of loyalty programs (in constant pursuit of rewards) o Expect “hassle-free travel” o o Passive users of loyalty program (by-product of when they travel) © 2013 L.E.K. Consulting LLC. All rights reserved. 9th FFP Loyalty Conference 2013
  3. 3. Loyalty programs are adapting to a more sophisticated traveler to provide a better, more personalized customer experience… © 2013 L.E.K. Consulting LLC. All rights reserved. 9th FFP Loyalty Conference 2013
  4. 4. 8 big reasons why loyalty will transform the customer experience o 1 Loyalty programs are increasingly integrated with everyday living o 2 Data analytics help identify chances to customize the guest journey o 3 Loyalty-data-driven segmentation can better match needs to guests o 4 Customized optional services can change the guest experience o 5 Personal recognition drives loyalty among the most valuable members o 6 Loyalty alliances enhance the reward incentive o 7 Experiential offerings can drive aspirational behavior in loyalty o 8 Feedback can be a powerful tool in enhancing a member’s experience © 2013 L.E.K. Consulting LLC. All rights reserved. 9th FFP Loyalty Conference 2013
  5. 5. 1 Loyalty programs are increasingly integrated with everyday living Hotel Points Airline Miles Earning Options Extending the customer experience to new areas, both within and beyond travel Redemption Options Source: Company websites, L.E.K. Analysis © 2013 L.E.K. Consulting LLC. All rights reserved. 9th FFP Loyalty Conference 2013
  6. 6. Data analytics help identify chances to customize the guest journey 2 Guest journey Preferred food & drink made available Recommendations based on prior trips Room preferences known Airport Flight(s) Booking Feedback Search Travel Travel Meals on-thego offered Shower Flight(s) Sleep Elite customer recognition Tailored comfort (e.g., luxury pillows) Rewards Saved preferences & profile-based suggestions Tailored loyalty packages © 2013 L.E.K. Consulting LLC. All rights reserved. 9th FFP Loyalty Conference 2013
  7. 7. Loyalty-data-driven segmentation can better match needs to guests Business traveler segments Food Productivity Recognition “Segment 1” Sample needs throughout the journey 3 “Segment 2” “Treat me elite” “Remember my preferences” “Frictionless leverage” “Special selections” “Enable my work habits” “Too rushed to eat“ “Segment 3” “Better room” “Do it for me” “Better than home” Target guest need states with well designed experiences Higher guest satisfaction and harderto-copy offerings Brand distinction and true loyalty Loyalty-based intelligence enables customized “options”, sharpening brands © 2013 L.E.K. Consulting LLC. All rights reserved. 9th FFP Loyalty Conference 2013
  8. 8. 4 Customized optional services can change the guest experience Archetypal guest travel experience Need states occur during steps in the guest journey Guest segment member on a trip 2 Optional service Delightful surprise Step in guest journey Desired outcome OR 1 Optional service Poor experience E.g., wasted time, unfulfilled expectations, etc. © 2013 L.E.K. Consulting LLC. All rights reserved. 9th FFP Loyalty Conference 2013
  9. 9. 5 Personal recognition drives loyalty among the most valuable members Recognize elite travelers… Greet them by name Customized travel suggestions Personalized benefits and perks Give them the experience they want based on known preferences and behavior and make them feel special © 2013 L.E.K. Consulting LLC. All rights reserved. 9th FFP Loyalty Conference 2013
  10. 10. 6 Loyalty alliances enhance the loyalty reward incentive “This enriches the experience for our most valuable travelers, and gives both Delta and Starwood an opportunity to target frequent travelers who aren't already part of our programs, enabling us to capture greater share of the global, high-end traveler…" Frits van Paasschen, CEO of Starwood Benefits to mutual members: • Bonus points/miles • Perks reciprocity for elites Source: The Wall Street Journal, COLLOQUY Loyalty Awards, The Points Guy, company websites © 2013 L.E.K. Consulting LLC. All rights reserved. 9th FFP Loyalty Conference 2013
  11. 11. 7 Experiential offerings can drive aspirational behavior in loyalty Experience Exclusivity Free lounge access Super-elite status American Airlines Concierge Key Starwood Ambassador Free events Exclusive convenience perks Hotel room upgrades Delta Porsche escort Source: The Wall Street Journal, COLLOQUY Loyalty Awards, The Points Guy, company websites © 2013 L.E.K. Consulting LLC. All rights reserved. 9th FFP Loyalty Conference 2013
  12. 12. 8 Feedback can be a powerful tool in enhancing a member’s experience Real-time feedback at different points of journey Measure customer experience to uncover specific issues How would you rate the helpfulness and courtesy of service staff during your room service order? Excellent Very Good Good Fair Poor N/A React to feedback to make the experience more enjoyable Incentivize feedback (e.g, with loyalty points, coupons, etc.) © 2013 L.E.K. Consulting LLC. All rights reserved. 9th FFP Loyalty Conference 2013
  13. 13. Rich intelligence about the journey means the experience can (finally) be personalized! © 2013 L.E.K. Consulting LLC. All rights reserved. 9th FFP Loyalty Conference 2013
  14. 14. LEAD SPONSORS Closing slide Question and Answers © 2013 L.E.K. Consulting LLC. All rights reserved. 9th FFP Loyalty Conference 2013

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