The "mass affluent" is an important customer sector within the travel loyalty industry – so why is it that so many high-earners seem short-changed and disengaged by their current programmes?
NB: This is a viewpoint by James Berry, ecommerce director at Collinson Latitude.
Loyalty and travel: the state of play
It’s no secret that technological and digital advances have resulted in a huge shift in consumer attitudes and behaviours. Brands are realising the need to connect on an increasingly personal level with their customers to maintain their interest.
2016 research from Collinson Group, repeated after an initial 2014 survey into more than 6000 mass affluent consumers from all over the globe, investigates consumer attitudes to loyalty programmes and shows just how much has changed two years on.
Mass affluent consumers - defined as the top 10-15% of earners, globally - are an important segment of any travel loyalty programme. This group takes an average of 2.9 return flights for business and the same for pleasure per year, while 56% of them opt to stay in a four or five-star hotel on a leisure trip.
These consumers expect advanced digital experiences and brands that they can identify with - but it seems loyalty programmes aren’t yet meeting these expectations and indifference is settling in as a result.
The need for change
Collinson Latitude’s recent eBook, which explores the mass affluent in relation to travel loyalty programmes, reveals that the past two years have seen a huge leap in apathy towards programmes. Of the mass affluent consumers questioned 35% said they ‘couldn’t be bothered to participate’ with programmes. This is a significant increase from the 2014 survey when only 17% admitted a similar attitude.
Drilling down deeper, some said that travel loyalty programmes have specifically decreased in value:
- 20% think that airline loyalty/FFP programmes have decreased in value over the last two years
- 14% say hotel loyalty/FGP programmes have done the same
The apathy spurring disengagement with such programmes isn’t too surprising when considering the wider context. Mass affluent consumers are clear on what it is they want from loyalty programmes; choice of rewards (67%), offers (61%) and the ability to collect points and miles (66%). But with many of the opinion that there is nothing of relevance on offer (20%), it’s understandable why this indifference exists.
This particular demographic is not being offered what is desired, which naturally leads to greater apathy.
It’s time brands revamped their programmes to offer greater choice, breadth and depth of rewards, to avoid losing out to a competitor’s programme.
So what can brands do?
Programme managers should look at their product through the eyes of a mass affluent consumer and work to enhance the loyalty experience and encourage engagement by:
1) Using data to improve personalisation
Consumers wants to feel recognised and be rewarded for their loyalty, with benefits that are relevant and desirable to them. Sabre research released at its London Technology Week event, Envision, showed that UK travellers are willing to spend £60 on air extras and £56 on hotel extras to ‘personalise’ their travel experience.
Using transactional, contextual and behaviourial data from their programmes, coupled with leading edge technology, airline and hospitality brands can create more personalised environments, communications and rewards that resonate and treat members as individuals, not numbers.
2) Embracing technology
Advances in technology have created the opportunity for consumers to interact with companies in the way they want, when they want and how they want; both online and off. Increased use of portable devices such as smartphones and tablets mean that your consumers are never really out of reach – so it is essential that loyalty programmes take advantage of this.
3) Embracing loyalty commerce best practices
Ask yourself, is your loyalty programme embracing the latest e-commerce best practices that we see from the latest and greatest e-commerce brands? For example, do you send one-click emails to members? Have you given your members the ability to earn points on their redemptions? Can members redeem rewards using points and cash?
If the answer to these points (and more) is no, it’s time to make some immediate changes.
Look at what booking.com is doing with its app. Using artificial intelligence and machine learning, it makes suggestions based on the personal experiences of users, providing them with recommendations in terms of the best suited local events and attractions, which can be booked and accessed from within the app.
That is an example of how loyalty schemes should be thinking about their approach to the mass affluent customer if they want to address their apathy and re-engage this important segment.
NB: This is a viewpoint by James Berry, ecommerce director at Collinson Latitude.
NB2:Image by Freeimages.com