Customer loyalty: a lost cause in travel? Not if you rethink it

Now travel is recovering – the US Travel Association reports air passenger numbers are up 6% from 2023 – and brand loyalty is up for grabs. Travel brands need to revisit and reevaluate loyalty strategies and recapture loyalty by understanding their customers and what they want.

What customers expect from travel and tourism brands today

Today’s travelers want a greater return on their loyalty investment – which is what this value exchange is, ultimately – so travel brands must be more open to rewarding differently. What’s worked up to now simply won’t cut it. McKinsey research shows the net likelihood of customers recommending a loyalty program dropped steeply between 2021 and 2023. And fewer are sticking with a company or spending more frequently as a result of membership.

To meet evolving expectations, travel brands need to offer more than just points to redeem with the same airline or travel provider. This feels self-serving and limits opportunities for customers to treat themselves. Customers want rewards that are highly relevant to their lifestyles and priorities. In other words, an experiential exchange.

Rethink your rewards

The way to captivate customers and win their loyalty today is often through wider experiences that cater to their specific interests. Think concert tickets, theme park entry, and fine-dining packages.

These experiences can still be linked with travel. Perhaps, like me, they’re a Kansas City Chiefs football fan, who’d be enticed by the opportunity to fly to a game and watch them play. Or maybe they’d like to soak up some culture? If so, VIP tickets to a gallery exhibition launch or the hottest show in town are the way to bring them closer to your brand while they enjoy a city break.

Customers are also more likely to become brand advocates from these kinds of thoughtful, stand-out experiences. An incredible night out will get them talking more than a clump of points. Experiential exchanges can be great for acquisition too if a prospect realizes a brand offers more meaningful rewards than its rivals.

Pick the right partnerships

Customers’ dream experiences can’t be provided by one travel brand alone. Brands need to join forces. It’s the principle behind the ecosystem economy, where companies can safely collaborate using a data clean room to co-create seamless multi-brand experiences.

Collaboration between airlines and car rentals or hotels is par for the course. But re-incentivizing customer loyalty is about moving beyond traditional add-ons. Break out of the travel space altogether by exploring partnerships that make a difference to customers’ lifestyles.

Consider partnerships that carry a sense of luxury, such as redeeming points on an elite driving experience or a set of premium golf clubs. Then booking more flights with your brand doesn’t just move customers from silver to gold but moves them closer to their lifestyle aspirations.

Notable partnerships are already emerging. Last year, a major hospitality brand partnered with a prominent outdoor retail brand to reward loyal guests with memorable outdoor experiences. Delta and Starbucks have come together to revamp their loyalty partnership, so travelers have more ways to earn and redeem points.

However, even if you’ve expanded your loyalty offers and brand partnerships, personalization is still key.

Understand more about your customers – business travelers too

Personalizing rewards and experiences requires more information about your customers than preferred travel times, airlines, and hotel brands. Learn what’s important to them and what they’re up to when they’re not spending time or money with your brand. That way you can offer them relevant rewards and experiences.

Business travelers are a particular blindspot. Brands often have insight into customers’ business travel data but not their personal behavior data. There’s a massive opportunity for brands to connect personal and business data and offer corporate travelers more reasons to spend with them by providing tailored rewards they can enjoy outside of work, too.

This customer understanding comes from first-party data that offers a bounty of insight to personalize loyalty exchanges and programs, including for business travelers. And, thanks to technologies such as data clean rooms, brands are getting more comfortable and secure in broadening that understanding, and their audiences, by working within trusted partner ecosystems.

Learn how Acxiom’s marketing solutions for the travel industry can help you understand your customers and drive brand loyalty.