BY Rachel Cagle
Many airline loyalty programs are failing to deliver on their intended purpose because members do not understand how to redeem the awards they accumulate. According to the J.D. Power 2019 Airline Loyalty Program Satisfaction Study, nearly half (45%) of program members say they do not understand how to redeem their miles and/or points. This lack of understanding has a significant negative effect on overall customer satisfaction.
“This is the third year in a row that we’ve seen airline loyalty program customer satisfaction hampered by a widespread lack of understanding of how to extract the most value from the programs,” said Michael Taylor, Travel Intelligence Lead at J.D. Power. “Many airlines are evaluating the success of their loyalty programs based on dollars spent by travelers rather than on miles flown. That’s a significant shift away from rewarding frequent travelers and toward rewarding high spenders.”
Following are some key findings of the 2019 study:
- Lack of understanding program details negatively affects satisfaction: While overall industry satisfaction increases to 789 (on a 1,000-point scale) from 776 in 2018, airline loyalty program member satisfaction climbs 135 points when members understand how to redeem points and increases 129 points when members understand how to earn points. Yet, nearly half (45%) of general loyalty program members say they do not completely understand how to redeem rewards and 43% say they do not fully understand how to earn miles/points.
- Recognition goes a long way toward building customer loyalty: Overall satisfaction scores increase 102 points when passengers’ names are used by airline staff, yet this occurs just 35% of the time. Similarly, overall satisfaction climbs 68 points when a member of the airline staff recognizes a loyalty program member’s status during the booking, check-in, departure or flight. However, this happens more than half (53%) of the time.
- Most important perks: Among specific benefits and rewards used through airline loyalty programs, discounts on airport and limousine services drive the most significant increase in overall satisfaction (+102 points), followed by waiving same-day change fees (+95) and lowest rate guarantee (+94).
- Increased mobile app use associated with higher satisfaction: Mobile app usage among loyalty program members has increased 10% during the past year, with 56% of program members reporting that they have such a mobile app on their smartphone or tablet. Loyalty members with mobile apps are more satisfied overall (+70 points) than members without the mobile app.
Frequent Flyers who are frustrated with the complexity of their current loyalty program can be swayed by promises of simplicity when marketers target them with digital or traditional ads. According to AudienceSCAN, 60.6% of Frequent Flyers watch a minimum of three hours of TV daily, with 56.4% having taken action after seeing a TV commercial last year.
AudienceSCAN data is available for your applications and dashboards through the SalesFuel API. In addition, AdMall contains industry profiles on airline services and airport operations, as well as lead lists at the local level. Media companies, sales reps and agencies can access this data with a subscription to AdMall from SalesFuel.