On May 1 1981, the launch of American Airlines’ AAdvantage frequent flyer programme was widely regarded as a landmark event in the aviation industry: new and influential standards were set.
While forms of customer tracking and loyalty programmes already existed, the management of customer loyalty became a more serious and sophisticated business than ever before.
The way in which the world operates has changed dramatically since the 1980s, of course, but customer loyalty remains vital not just in aviation but across the travel industry.
So how do you build and keep loyal customers in this modern, intensely competitive and rapidly changing world?
Relying on customer inertia (which is absolutely not the same thing as customer loyalty) won’t work anymore. Now, as a customer, if you don’t like the deal on the table (or, more probably, your screen or voice-enabled device), you just click a link and move on to another company.
In fact, research by Expedia Media Solutions suggests travellers visit 38 websites on average when planning trips. People aren’t afraid to click and move on.
Does that mean customer loyalty is dead? Absolutely not. But you must think more creatively than ever before if you want the people who love your brand today to feel the same way tomorrow, so here are six points I’d urge you to consider:
1. Understand your customers and personalise what you offer them
Make sure each of your merchandising activities, from landing pages and banner advertising to e-mail campaigns, promotes the most attractive deals for that specific customer base (which might be very different from the customer base for another campaign).
One of the main reasons people sign up for e-mails and newsletters is to access discounts, which makes effective, targeted merchandising crucial in driving conversion and brand loyalty. With the vast amount of customer data travel companies now hold, and the sophisticated means of analysing and exploiting that information (including machine learning), personalisation is increasingly critical, not optional.
We’re not just talking types of customer here but specific individuals. People expect highly personalised marketing nowadays – for example, suggestions for holiday packages based on their recent travels or usual hotel preferences.
2. Offer the complete deal
Aim to offer a complete travel package through your website, from flights and hotel rooms to car hire and insurance. Maintain excellence in your core business, of course, but work with specialist partners in other sectors of the industry.
If you don’t want customers to be tempted by a competitor’s offering, don’t give them a reason to leave your website and visit your competitor’s site.
3. Maximise customer touchpoints
Allowing customers to interact with your brand every day helps build loyalty. Look outside the travel industry at innovative brands whose customer loyalty is beyond dispute.
Apple, for example, is a master at evolving to meet – and indeed guide – the changing lifestyles of the company’s customers. From computing and music to mobile phones and mobile payment systems, Apple unites areas not traditionally covered by a single company.
4. Create niche brands
Capitalise on the opportunities of niche branding. Many leading travel companies offer sub-brands (such as United Airlines’ United Express) to better match their services to particular customer segments.
The same opportunities are there for other travel businesses too, such as online travel agents. Multiple brands allow customers to remain loyally under the umbrella of your overall business even when their requirements, lifestyles and financial capabilities change.
5. Be different
Merely having a loyalty programme won’t differentiate your business from competitors anymore. However, if you give your customers a surprising and memorable experience, their glowing feeling will linger to create brand loyalty.
Why not send good customers unexpected gifts, totally unrelated to the defined rewards they earn through your loyalty programme? They’ll feel happy and appreciated, and they’ll be likely to spread the word on social media.
Send a ‘Have A Great Trip’ package of travel goods to loyal customers before they fly or film yourselves physically handing a gift to a customer and then create a viral advertising video. This tactic, known as ‘giftvertising’, has been successfully exploited by companies including Canadian airline WestJet.
6. Use gamification
Motivate loyalty and customer engagement through gamification, which is essentially the process of adding competitive elements – and then rewards for success – to your existing services and/or loyalty programme.
An airline, for example, can run a ‘leaderboard’ of frequent flyers based on factors including miles flown. Take a look at Air Canada’s ‘Earn Your Wings’ for a great example of gamification at work in the travel industry.
Customer loyalty in the travel industry may be declining but, more importantly, the nature of that loyalty is changing. If you change fast too, you can leap ahead of your competitors for a long time to come.