There’s a tremendous amount of effort put into understanding Millennial and Generation Z consumers – individuals aged 18 to 35 – what they like, what motivates them, and how they are willing to spend their disposable income. This is for good reason; these consumers represent $143 billion in spending power, and comprise about 38% of the US workforce. Brands need to meet their needs in order to survive, and if they hope to be able to compete they need to identify ways to drive loyalty from this cohort.
Most travel loyalty programs typically have point accrual and redemption as their core functionality.
Membership in travel loyalty programs have other privileges as well, but it’s impossible to divorce these programs from the earning and burning of points or miles.
And for many travelers and loyalty members, that’s just fine.
But the next generation of consumers – young Millennials and Generation Z – don’t want one-size-fits-all rewards.
Hotel brands know who their best customers are. They are the high-value guests that travel frequently and always – or at least consistently – book and stay at properties in the brand network. They are active members of the hotel’s loyalty program. They book higher-tier rooms, have a high average cart size on the hotel’s ecommerce site, and spend money on property for ancillary services, food and beverage and entertainment. They refer other travelers and are advocates for the brand.
New companies are entering the travel rewards industry, addressing the needs of younger travelers, while traditional loyalty programs are also expanding their offerings.
Travel is a vast industry and as the online sector looks set to become a $817 billion industry, the timing seems right for fundraising. Tech assessment platform TechCrunch says that Switchfly “uniquely combines a highly scalable and secure architecture with deep product and content inventory”. As pressure increases on margins, this revenue boosting technology could not be more timely.
Nearly every travel brand knows that direct bookings offer a powerful opportunity to take control of their relationship with customers. But knowing how to make it happen can be challenging. The emerging set of best practices below offers a road map to move from idea to action.
Loyalty Beyond Points and Miles: Creating Rewarding Experiences for the Experiential and Millennial Traveler
Today’s consumer no longer thinks about loyalty solely in terms of points and miles. That’s created a growing opportunity for travel brands to rethink the strategies they use to build loyalty with travelers.
Today’s travel consumer faces a needlessly complex online shopping experience. There are too many choices, and offers are not customized to address buyers’ unique needs. To solve this problem, travel brands must use what they already know about their customers to simplify, streamline and personalize the purchase process.
Justin Steele, vice-president of product at travel e-commerce specialist Switchfly, believes that the ultimate goal for personalisation is to create a travel retailing platform, a curated experience that combines what is currently possible – flights, times and dates, with the amenities and luxuries passengers desire, plus the products and services that they will need at their destination.