The win-win cycle of loyalty programs

A hot topic is the travel industry’s use of loyalty programs to foster and maintain consumer relationships while increasing their brand recognition and improving the organization’s bottom line. The frequent traveler quickly finds that earning points increases their “status” levels and leads to priority services. The organization then increases revenue by the traveler’s loyal spending. This cycle has fueled massive program membership among all parts of the travel industry.

I engage in the cycle and have made a point of enrolling in the programs where I intend to earn even just a few points each year. Keeping an account active varies by program, but generally it is not hard to keep your points or miles from expiring. Redemption is a completely different subject and can be tricky based on the traveler’s status and the availability of the product or service.

American Express has a program called Membership Rewards® which allows cardholders to earn points and then transfer them into a host of company’s individual programs. I have found this very useful because it allows me to deploy points at my choice. Another favorite program is the Delta Airlines Skymiles® program which allows partial payment of many published fares using mileage. For instance, on a recent trip to Key West, Florida, I was able to deduct $600 off a roundtrip first class ticket and only spent money on what would average as a coach class ticket.

Even the smallest of travel related organizations should develop a loyalty program. The advantage is that by having consumers become participants they can increase brand visibility, publicize changes to their product offering, and identify trends that impact future growth. Nothing is better than a repeat customer and each loyalty program administration must agree.

Do you have any comments on the topic? Any tips to share from either the industry or consumer perspective? Let’s get some dialogue started and learn from each other!

Check out this USA Today article for more great information and tips:

http://travel.usatoday.com/deals/inside/story/2011/02/Frequent-flier-101-What-you-need-to-know-about-loyalty-programs/43216508/1

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s