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Travelers Expecting Better Choices in Loyalty Redemption

Travelers Expecting Better Choices in Loyalty Redemption

SAN FRANCISCO—A survey of over 1,000 airline and hotel loyalty program members across the U.S. from Collinson Latitude, part of Collinson Group, reveals that most travelers expect greater choice and flexibility in how they redeem their loyalty currency. The research shows that over two-thirds (68 percent) of loyalty program members are looking for more choice of rewards besides the traditional offerings of flights and hotels. Nearly half (45 percent) described redemption programs only offering these rewards as ‘dated’ and ‘old-fashioned.’

In addition, the study also reaffirms the clear commercial benefit for travel loyalty programs providing a broader redemption offering, beyond their core inventory. Sixty-one percent of airline members went on to book a flight and 56 percent of hotel members went on to book a hotel room (core inventory) following a redemption on non-core inventory rewards such as electrical goods or day experiences.

Now in its second year, ‘The Value of Redemption’ survey also showcases the particular value of a broader redemption proposition for both inactive, as well as those members living outside of the programs’ core domestic market. For example:

* Non-core rewards drive re-engagement: Non-core rewards are very powerful in winning back customers who haven’t purchased from a brand for some time (3 months); of the 1 in 2 (48 percent) of members who had reported that a redemption had driven a re-engagement with their programme, 58% of members had redeemed on non-core inventory in comparison to 43 percent who had redeemed on core inventory.

* Non-core inventory redemption is important for members with a global footprint: Non-core inventory is more regularly redeemed than core inventory by members who were part of a program not based in their home region. Nearly a third (31 percent) of these members regularly redeem on non-core inventory, as opposed to 18 percent of members who regularly redeem on core items.

“It’s fascinating to see the correlation and added value that greater choice of rewards and non-core inventory has within loyalty redemption and on a travel brand’s bottom line. Giving our customers greater choice on what they can spend (redeem) their points on and how they pay, is a key priority for our program which in turn keeps members engaged and loyal.” said Madeleine Van Wilderen, head of commercial partnerships at Flying Blue. “The insight here of how non-core inventory can reactivate members is certainly consistent with what we have seen for our members living outside of key hubs. We are delighted to be able to support all our members and help them get value from our program wherever they live.”.

This year’s study also finds over a half of members (55 percent of airline and 57 percent of hotel loyalty program members) would like to be able to redeem their points in retail outlets and 40 percent agree (42 percent of airline and 37 percent of hotel members) that the value of a loyalty program decreases if they cannot redeem their points in-store. This highlights once again that increased choice is a key requirement to drive engagement for travel loyalty program members globally.

Guy Deslandes, e-commerce sales director, Collinson Latitude, part of Collinson Group, said, “These findings show that travel loyalty program providers must extend their member engagement capabilities so they can cater for the changing and ever increasing expectations of their members. Members want their programs to provide them with experiences and rewards that suit their lifestyle so it’s imperative that loyalty programs providers have an ecosystem that allows for increased engagement touch-points. This is a huge opportunity for brands, as we all look to intertwine more tightly to our member’s everyday lifestyles”.

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