Meet the Disloyal: Us or Them?
By Robert McGarvey
Digital commerce company iSeatz – which focuses on loyalty technology – has big news for the loyalty programs owners: we think their programs need help. A lot of help if they are to meet our needs and create the loyal customers they want us to be.
iSeatz arrived at this conclusion by doing empirical research and producing a lengthy report. iSeatz elaborated about its method: “iSeatz conducted two surveys in late 2022. The first asked 2,041 consumers from across the United States and from different socio-economic backgrounds about their views on their loyalty rewards programs….The second was a survey of 291 loyalty program managers conducted online from November 18-December 12, 2022.”
A key takeaway from the research: “there is a disconnect between what most loyalty programs offer and what their members demand, which limits their potential. One finding illustrates this in stark terms: 63% of industry respondents say their programs are members’ first choice when booking travel, but only 51% of consumers report the same.”
An even more startling disconnect: 52% of respondents said their loyalty programs deliver what they most value. But 92% of loyalty providers say they are delivering what customers need and want. About one in two of us really like our loyalty programs – but the providers think all of us except for a handful of malcontents who probably would be satisfied with nothing love them.
Another metric that is highly problematic: just 20% of providers say user experience is a difficulty, but 84% of us say user experience is a frustrating part of booking. How could the providers be so off base? The answer is simple. Probably they are benchmarking their site against competitor sites and if they all stink, well, that lowers the bar. iSeatz numbers point to this as a problem: “While 74% of the survey group said they consulted other travel booking sites for inspiration, only 55% looked to major consumer-facing e-commerce websites or apps like Uber or Amazon that their members likely interact with daily.”
The big question: Is it time to bury travel loyalty programs, just walk away from them? Personally I have a foot in that egress path as I put more focus on cashback programs and much less on travel loyalty.
But even I think it would be premature to simply toss travel loyalty out of my universe. Just in the past 18 months I have gotten roundtrip comfort class tickets for two twice just by cashing in Amex rewards. The experience at Amex was fine, by the way, although it mainly consisted of clicking away hundreds of thousands of points to Delta where I got the tix.
Essentially, however, I am indifferent to the loyalty programs I belong to – Delta, AA, United, Marriott, Hilton. I’ll grab free wifi at a Hilton because that’s easy but mainly the programs are just things I know I belong to.
iSeatz tells what programs need to do to engage me and probably you: “Travel loyalty programs can be a differentiator for financial institutions, travel brands, or companies in any other industry where competition is fierce. But only if they provide an outstanding booking experience, a wide range of travel and lifestyle reward options (including sustainability-related rewards), personalized engagement, and next-generation payment options.” (Emphasis added.)
For me, I’d say two things matter most in deciding if my experience is satisfactory. #1 Can I in fact actually book on the approximate dates I have in mind? I do not approach a reward booking with fixed dates in mind – usually it’s something along the lines of “late September or early October,” maybe a one month booking window. #2 Is the price reasonable – and since I no longer see awards charts from the carriers I fly the honest answer is that often the costs I find when trying to book seem very high.
I find it maddening that today the redemption game is played with the goalposts in motion. How much is a ticket to Europe in the fall? Used to be we knew how much. Now it’s whatever the market will bear.
Picture a cashback card where you don’t know – and cannot know – how much cash you will get back on a $100 purchase at a grocer. Would you continue to play the game?
But that frustrating uncertainty is precisely our lot with airlines and their loyalty programs.
It’s not we who are disloyal. It’s them.