Current Travel loyalty programs fairly efficiently monitor customer spending and adequately offer discounts, however not the same goes towards customer loyalty.
Interestingly, there seem to be a correlation with Retail industry, where discounts are an intrinsic part of business today - driving customer loyalty via further discounting is a vicious circle though, margins only continue to shrink: question remains, how to effectively use loyalty programs to improve the margin, as opposed to getting stuck in discounting cycle.
Companies further on Analytics Maturity curve are more successful in converting their customer loyalty programs into increased existing revenue or new incremental revenue, customer retention or competitive differentiation – all important (and strongly desired) elements of a company truly dedicated to increasing their CX (customer satisfaction) in both the short and long term.
Loyalty programs can be a great information source about customer preferences and patterns – when embraced well, these can be converted into customer insights – high value to not only loyalty schemes related initiatives, but to any company-wide strategic and operational efforts: sales and marketing campaigns, operations or even HR initiatives, for that matter.
Some travellers are ready to increase their engagement with travel brands – provided that their offerings are compelling enough of course. Engagement, preferably with some kind of emotional bond as well, might be the key to true customer loyalty (or one of them). More engagement between travel provider and customer and variety of its format, means more new data to be analyzed and hopefully more insights to be utilized – subsequently.