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Welcome to Travel Buddy
In this episode of the Travel Buddy podcast, presented by Switchfly, hosts Ian Andersen and Rachel Satow examine how generational shifts are redefining travel loyalty. Through a mix of industry data and personal perspective, they focus on what Gen Z and millennials value in rewards, what skepticism persists, and which trends will shape the future of travel experiences. Key Highlights • Generational shift: Hosts share that Gen Z and millennials are projected to drive over 50% of U.S. leisure trips by summer 2030, with Gen Z alone expected to spend $450 billion globally on travel. • Experiences first: Younger generations consistently value memorable trips over material possessions, reshaping value propositions in travel. • Sustainability as baseline: Gen Z expects sustainability as standard—while millennials remain more cautious, often questioning the sincerity of brand sustainability claims. • AI-powered personalization: AI enables loyalty programs to deliver highly personalized offers and seamless digital experiences, AI delivers proactive, personalized recommendations. • Demand for instant rewards: Gen Z prefers immediate, easy-to-understand perks and “daily earning” opportunities, looking to models like Starbucks Rewards for simplicity. • Flexibility and transparency: Unpredictable program changes breed skepticism. Younger travelers seek loyalty programs with straightforward earning, flexible redemptions, and low commitment.
Transcript
Brandon Giella (00:01.238)
Hello and welcome back to another episode of the Travel Buddy Podcast presented by Switchfly. I have with me as always Ian Anderson, welcome back, and Rachel Satow, welcome back. So excited to talk to you guys again. Today we are talking about loyalty status and travel trends and what matters most to modern travelers today. So we'll be talking about Gen Z and millennials. I am a millennial.
34 about to be 35 I'm right in the middle born 1990 what's up so I have my own travel thoughts I know you guys do too you Millennials yeah that's right that's right we're taking over the world but there is Gen Z coming up right behind us and there's a great wealth transfer coming one day and they're gonna dominate everything and then there's Gen Alpha behind them
Ian Andersen (00:38.393)
I think, yeah, we're all millennials on this one, I believe,
Brandon Giella (00:54.934)
And then there's betas. learned today one of, so I had a baby a week ago and that baby, boy, is a gen beta, but my daughter is two and a half, is a gen alpha. Fun fact.
Ian Andersen (01:07.089)
That's my two. My oldest is the very tail end of Gen Z and youngest is the upper end of Alpha and they're two years apart also.
Rachel Satow (01:08.76)
Very cool.
Brandon Giella (01:20.554)
So they're gonna be wildly different people that you have to figure out a parent them. Yep All right. So So what is happening is within this demographic shift Millennials coming up in the age of of social media where this this I feel like this is an important point in time where When we were younger, we did not have social media It came in later in high school and then into college where it got more in, our culture
Ian Andersen (01:22.321)
Yep, totally.
Brandon Giella (01:50.806)
But for Gen Z, that is not true. They have, since they were kids, had social media. It impacts the way that they think about everything, but particularly travel. And there are some growing trends, we feel, from millennial to Gen Z demographics that I think it's important for business leaders to understand, loyalty leaders to understand, especially if you're a boomer or Gen X. There are some differences within generations. People talk about this all the time, but...
I want to bring a point to it where we have some growing trends of sustainability, personalization, and instant and flexible rewards that Gen Z and millennials are looking for, as well as experiences. Now we've talked about this a little bit on the show before, but I want to dive a little bit deeper. So I'll throw it up to you two. There is a stat here that
Gen Z and Millennials are projected to drive over 50 % of US leisure trips by summer 2030. That's up by a third since 2023. So in that seven year gap, % will be driven by, 50 % of leisure trips will be driven by this next generation. And that Gen Z is projected to spend $450 billion globally on travel, averaging about three vacations every year.
In my experience, I think that's about true. And I think millennials and Gen Zs that I know want to travel and they want to have a great time and they're willing to spend some money on it despite inflation tariffs. But there it is. you guys, so what do you guys see just in general when you're thinking about millennial and Gen Z travel habits and what you're seeing maybe across generations, maybe folks that you know, maybe the way that you guys think about travel in general. And then we'll dive into some of those.
particular instances in a minute.
Ian Andersen (03:51.845)
think so, maybe starting with some of the similarities between Gen Z and millennials, kind of versus the older generations. A lot of what we've seen over the past few years is around experiences and both the millennial and Gen Z generations tend to value experiences.
far more than previous generations over material goods or things. So travel, you know, it really, really fits. It really makes sense that even though Gen Z is still relatively small as far as buying power and in the workforce, it makes a lot of sense that they're going to be and play an outsized role in the travel industry.
that taking a trip to Europe, to Asia, across the US, whatever it is, that experience would be more valuable to them than buying a new car, buying a new something. So I think as long as basic needs are met, both Gen Z and millennials are much more likely to go with the experience over the possession.
That said, travel is only gonna keep being in more and more demand kind of across the board.
Brandon Giella (05:23.49)
Yep. Yep. Heard. Rachel, what are your, what are your general thoughts on how you're seeing some of these demographic trends?
Rachel Satow (05:30.392)
Yeah, I mean, I think Ian hit the nail on the head there. are seeing, know, Gen Z and millennials are traveling differently, but I think it's important for us to highlight why this is such a hot topic and why loyalty programs are having to make shifts because of the new buying power of the younger generations. And it's really because since they are increasing their frequency and they are increasing the market share,
of their presence in the travel industry in comparison to older generations. We are seeing that phase out, the phase out of the boomers being able to travel. So all of that is really transferring down to millennials, Gen Z, eventually Gen Alpha and Gen Beta. And loyalty programs need to be sensitive to this shift as you would in any commerce situation, simply because the way these generations have grown up is so different.
in comparison to older generations and loyalty programs have to meet those demands. So I had mentioned that Gen Z is traveling differently. They're really leaning into the tech side of, know, we've got AI that's able to help them plan things. We've got, you know, such frequency that they're able to kind of shift the way they're allocating their disposable income. And in order to capitalize that appropriately, loyalty programs need to be able to capture their attention.
you
Brandon Giella (07:01.058)
I'm glad you mentioned AI because I think they're across a lot of these trends that we're seeing that we have here in our notes. There is like a convergence of these trends.
So you've got technology and AI and things like that, but you've got sustainability. You've got hyper personalization. You've got instant and flexible rewards. All of these things are kind of intermingling. So here's what I mean. And I want to get your thoughts on this. So on the very first trend that we're talking about here is sustainability.
And so the younger generations are much more sensitive to environmental impact or their eco stewardship, if you will, or green travel, because of the sensitivity of some people say, because their time horizons a lot further out, you know, they've got to be on earth for another 70 years, you know, whatever. Whereas somebody that may be is a boomer is not thinking as far as that's one argument people make. but when it comes to travel, I'm curious how you guys think about
sustainability as it relates to travel. So there's a stat that says that 42 % of Gen Z and 38 % of millennials took action to travel more sustainably in 2023. And I'm curious how you guys interpret that data because when I think about sustainability and travel,
I do see things like on Google if I'm searching for a flight or or whatever like let's say I'm going to London I'm looking at the trip to London and I'm comparing flights and sometimes I see this little thing on Google that'll say like you know, this flight path takes three percent less Carbon emissions than another flight path or whatever and i'm curious how much that might impact your
Brandon Giella (08:49.632)
decision to take a trip or not take a trip or whether you take you know an uber or not. So Ian you had mentioned like price is always the number one differentiator and then maybe it's timing and then maybe we'll get to the sustainability question but but I'm curious like how do you guys think that sustainability impacts decision making for for younger travelers?
Ian Andersen (09:13.649)
I think so Rachel had a good point earlier, I think before we started recording on how sustainability has become so culturally pervasive that especially among Gen Z, they don't necessarily actively think about it, right? It's just, it's sort of like, you make sure there's gas in your car before you start driving. You make sure like it's...
it's a natural thing for them to just sort of go with a sustainable option, all else being equal, right? So it's not necessarily top of mind, but it does affect their behavior just because it's natural. With millennials, especially someone like me who's an elder millennial kind of on the edge of Gen X and, you know, I...
come up in the sort of green revolution, that sort of marketing and messaging still really stands out to me. And it doesn't affect my behavior and I think most millennials behavior, but like you said, all else being equal, right? If a sustainable option, no matter how it's messaged,
is significantly more expensive than one that may or may not be. It's just not messaged as so. Most people and that's every generation are going to go with the lower priced option and travel price. And I don't want to say in travel in most things, but travel definitely price is your number one consideration, right? And especially now we live in a time of
most people doing their travel buying not through an agent, not even directly with the supplier, but through a platform aggregator like Switchfly, like Priceline or Hopper or one of the others. That is basically a list, you you may not necessarily know which is the most sustainable option. I know you say Google highlights it, but
Ian Andersen (11:38.755)
Even then, is it bumping those to the top or is it just a little kind of sidebar that displays slightly more sustainable option, right? So, Intel culturally, and I don't know if it'll ever get to this place, but Intel culturally, we all sort of decide that sustainability is a number one, number two priority.
Brandon Giella (11:43.562)
Mm-hmm.
Brandon Giella (11:52.47)
Mm-hmm.
Ian Andersen (12:08.557)
it's going to affect things only barring all else being equal.
Rachel Satow (12:15.318)
You know, Ian, you bring up an interesting thing in your earlier statement about how it's not necessarily that millennials or Gen Zs are shirking their responsibility from a sustainability standpoint, but you had mentioned that, you you saw the Green Revolution happen. And I think that's a really key differentiator between millennials and Gen Z is that millennials saw the shift happen when it was really pushed five, 10 years ago for companies to become
more conscientious of their carbon footprint and their sustainable options. And it became almost a selling point for brands to showcase, we are taking this into consideration. And I think millennials can sometimes see like, this might be just a marketing ploy. So there's that potential for doubt on the sustainability side from the perspective of.
you know, it being out there for a travel travel brand. Whereas with Gen Z, they grew up only knowing the sustainable option. It's an expectation for them at this point that brands are doing the right thing and taking the steps to be more sustainable. So when we dial that back into the conversation regarding price, I think from a psychological standpoint, they're probably making decisions not with the idea of sustainability first, because they're already
assuming that the brands they're purchasing from have made the choice to take the sustainable route. So that's why we might see that little bit of a dichotomy between the two generations where there's almost this millennial perspective.
lack of trust that these sustainable options are real, whereas for a Gen Z, they just are working with the assumption that brands are making the right decisions and are going forward with sustainable options and that they have the freedom to choose the lowest price because all brands are working towards the same goal.
Brandon Giella (14:22.7)
Mm-hmm.
Ian Andersen (14:22.959)
Right. Or all brands aren't right. I think you see a lot of skepticism and in Gen Z that you don't always see in millennials. But but I think you're right on the environmental sustainability. I do think that brings up a point, Brandon, that you discussed earlier is there are different types of sustainability. Right. Like there's we generally think of it as environmental. And I think
Rachel Satow (14:25.632)
Mm-hmm.
Brandon Giella (14:25.666)
Hmm.
Rachel Satow (14:33.196)
you
Brandon Giella (14:47.959)
Mm.
Ian Andersen (14:52.943)
what we've been talking about so far has been mostly on the environmental side, right? But there are things like social and economic sustainability as well. And those do affect people's choices and behaviors. Those are considerations to make. It's one though, some though that are.
Brandon Giella (15:02.121)
Mm-hmm.
Ian Andersen (15:17.777)
hard to quantify a lot of times and hard to message against. you know, Brandon, when we were talking earlier, you brought up the point of somebody who might not want to use a Uber in New York City because it might be considered unfair to the taxi drivers who had worked so hard to even earn their taxi medallion. That is a very specific and unique
Brandon Giella (15:33.484)
Mm-hmm.
Brandon Giella (15:38.881)
Mm-hmm.
Ian Andersen (15:47.313)
of sustainability that isn't going to have broad messaging appeal across the country, much less across the world. think if you're talking to somebody in Arizona talking about taxi medallions, Uber being unfair for taxi drivers and getting their medallion, it's just not going to resonate in the same.
the same way as would to somebody who lives in New York City or goes there often. So social sustainability is a big one. Economic, know, how many years now has the discussion revolved around the economic environment that younger millennials and Gen Z are coming up in is far different than Gen X and boomers.
Brandon Giella (16:42.345)
Mm-hmm.
Ian Andersen (16:46.871)
So, but that is still unique and targeted in a way that say environmental sustainability isn't. And I think that's where AI and personalization is going to play a much bigger role in that when you're identifying environmental sustainability has become so ubiquitous that you almost don't need the targeting, right? Most people across the board believe
that there is some effect humans are having on our environment that is negative, right? The degree of which is argued about a lot, but the mere fact that we are having this effect isn't really much of a question anymore, right? So you can message environmental sustainability in a pretty broad way that's gonna resonate from some 18 year old buying the first plane ticket all the way to...
you know, an elderly person going to see their grandkids. Whereas some of the social and economic sustainability questions may not have that broad messaging appeal. And this is where AI will really start playing a role, Is being able to identify who's asking the question and then targeting the messaging to them, not only generationally, but all, you know, all forms of
of demographic, whatever their other demographic features might be, it will be able to be a lot more targeted to them.
Brandon Giella (18:24.066)
I want to be clear that we're talking about really big terms, know, sustainability, personalization, demographic shifts. But we're so we're seeing the stats, we're seeing the research, but we're also seeing people actually make decisions based on some of these trends in real life. I mean, I mentioned before we were recording that, had a friend of a friend who
Ian Andersen (18:42.832)
Mm-hmm.
Brandon Giella (18:49.558)
decided not to uber with us to dinner across Manhattan. He wanted to go in a taxi for social justice reasons. I had a friend recently and this is where these trends start to converge in real ways is with generative AI. And we talked in an episode a few weeks ago about using generative AI to find, you know, off the beaten path, kind of, itineraries for when we want to travel.
I had a friend recently tell me like two weeks ago that they refuse to use AI because of its negative impact on the environment. It's energy use, it's water consumption to cool down servers, things like that. So these are real things and that people are actually making decisions and it affects the travel industry, particularly because airlines of course use huge amounts of fuel and carbon emissions in just traveling. And then hotels obviously being large.
large buildings using a lot of energy and so on and so on. But the AI mixed with experiences, mixed with the travel eco footprint, all these things are kind of interrelated and they are actually affecting people in real ways.
Ian Andersen (19:58.789)
think that, I mean, it's an excellent point and you hear about it occasionally. I've met people who have brought that up of refusing to use generative AI for environmental reasons. think in some ways they're missing the point of the genie is out of the bottle on that. And if you're not using ChatGPT or Claude or any of the various ones now,
Brandon Giella (20:14.902)
I agree.
Ian Andersen (20:26.897)
It doesn't matter as much because the people you're buying from certainly are using it, right? So you might be taking care of part of the equation and I don't want to dismiss anybody's, you know, feelings regarding it because it is a real thing. I'm not sure, I'm not sure that's gonna have much of a behavioral change.
Brandon Giella (20:33.655)
Yeah.
Ian Andersen (20:53.489)
except a very small percentage of the people and even those people, it's not like they can't or they can just avoid buying things. And whether it's travel or any other industry, across the board, companies are using AI. Whether it's, go ahead.
Brandon Giella (21:14.025)
Yeah
Sorry, I cut you off. I want to double down on that point that everybody is using AI in that way, generative AI in that way. If you're using Google or Apple Maps, that traffic data, you know, how you get to where you're going is generative AI. It's the same process. Or your voicemail being transcribed on your Apple iPhone or this very podcast being transcribed by the podcast tool.
Ian Andersen (21:26.117)
Yeah.
Brandon Giella (21:44.002)
It's all generative AI. It's all the same tool. We use it all the time. If you use Gmail, the Google servers are translating that information and scooping all that information up anyway. anyway, it's.
Ian Andersen (21:54.523)
Yeah, absolutely. going to the grocery store down the street, more than likely your grocery store, whether it's in its marketing, whether it's in its supply relations, the inventory management, they're using AI in various ways. Switchfly is in a number of different ways and I can't think of a company that is...
Brandon Giella (22:04.672)
Mm-hmm.
Brandon Giella (22:10.537)
Mm-hmm.
Ian Andersen (22:23.831)
actively taking a stance against using AI just because it's like anymore getting to the point of claiming you don't use the internet. So whether or not you personally make the choice on whether or not to use it, think, besides the point. The ads being served to you on your Facebook page are done through AI.
Brandon Giella (22:26.274)
Mm-hmm.
Brandon Giella (22:33.516)
Hmm. Mm-hmm.
Ian Andersen (22:52.145)
That's that is the important question. Actually, I was thinking when we first started talking, Brandon, this is we've been doing this podcast for about a year, a little over a year now. And A.I.'s been a common theme that comes up and it's.
interesting looking back at the conversations we had just a year ago about AI on and it was so much more on the user side, right? It was so much more like we would talk about things like letting AI build a trip itinerary for me or whatever, or, you know, talking about the best places to go for.
Brandon Giella (23:25.29)
Mm-hmm. Mm-hmm.
Ian Andersen (23:32.013)
if you got kids or whatever. And I think we totally missed the point on that is the least of what AI is doing in our society right now. Like that is, it does help you on an individual level, me going and putting things together, but on what I am seeing day to day, how the software I use behaves and interacts with me, that is far more prevalent.
Brandon Giella (23:41.814)
Hmm. Hmm.
Ian Andersen (24:01.807)
in in today's culture than anything we talked about a year ago regarding AI.
Brandon Giella (24:06.696)
Mm-hmm. Mm-hmm. Yeah, agreed. Agreed.
Rachel Satow (24:10.098)
So I think we're dancing around saying it, but I think the core here is that AI and all of its sustainable implications is, regardless of your personal choices, it's ingrained in the technology that we're using every day, and you can't get around it. And when we dial back into some of the trends we're seeing, we also have to take into the fact that...
it is enabling some of the expectations that are.
being created by Gen Z, Gen Alpha, et cetera. So I know we brought up the idea of personalization. Personalization at scale is being driven by AI's capabilities to take into account mass amounts of data and segment out individuals and be able to say on a one by one basis what would be perfect for them to serve. So when we think about going back to the sustainable aspect, you know, and how Gen
Brandon Giella (24:41.922)
Yes.
Brandon Giella (25:03.874)
Mm-hmm.
Rachel Satow (25:10.122)
Z is not necessarily making decisions to be more sustainable because they are valuing price more. We're also, we also have to take into account the personalization aspect of it. They're going to have the expectation that their lives and the advertisements they see, the perks that they are served are more personalized. They also have to kind of like make that choice of, ooh.
Brandon Giella (25:21.899)
Mm-hmm.
Rachel Satow (25:35.878)
the tools I'm using, the program I'm using has AI in it. And now they're having to like make sacrifices where, you know, on a personal basis, just because it's being implemented at scale.
Brandon Giella (25:39.745)
Yeah.
Brandon Giella (25:49.29)
Yeah.
Ian Andersen (25:49.585)
That's a really interesting point that I don't know if I've ever totally internalized of like, you know, coming up, growing up when we did and kind of the rise of the internet and it taking over the world.
Millennials were handed a tool at a pretty young age where you could go find what you needed, right? And give me a little bit of time. I can go find whether it's the flight I want or the type of software I need or whatever it is, I can go find it. But it would actively require me searching where now...
you know, over the last five plus years and definitely going forward, this search isn't a part of it, right? This will be actively handed to you without, you know, you might not even need to fully create the problem statement, right? That AI is getting to the point, AI and personalization is getting to the point to where
based on your general behavior, it's gonna be, it's starting to predict what you will need next before you might even know you need it, right? And your ads that you're being served, you know, just the offer, the general offers available to you that were, there were offers in those places before.
Brandon Giella (27:07.02)
Mm-hmm. Mm-hmm.
Ian Andersen (27:22.993)
you know, in early internet and in TV and radio and they all had ad spots, right? The monetization of the internet is the exact same as it was in newspapers 200 years ago. It's just you can't personalize an ad in a newspaper for exactly what Brandon or Rachel need at this particular point in time. And it's just getting to the point to where
younger generations will have never had to actively search for something they might particularly need, right? And if they do, it is an extremely limited search compared to what had happened before. And, you know, that's a bit of a double-edged sword, right? One, it might not teach them the skills sort of.
Brandon Giella (28:00.778)
Mm-hmm.
Brandon Giella (28:08.543)
Mm-hmm.
Ian Andersen (28:18.635)
required to do so that may or may not be transferable to other parts of the life, but on the other, it could make them infinitely more productive than we ever dreamed of being because they're won't have to necessarily think of the next step. That next step is going to be personalized and serve to them. They can be thinking four or five steps further, right? And, I think travel.
Brandon Giella (28:42.909)
Mm-hmm.
Ian Andersen (28:47.801)
is part of it, right? If a personalization engine like Switchfly can identify and start serving you something at the very beginning of your search, maybe even before you started making it, you're going to sort of take as given this offering and starting to think about the next things.
Rachel, probably want to cut this part out if I'm sort of like just brainstorming a bit of being interested and curious, but I just find that whole idea very fascinating of AI being so good. I mean, I don't know if it's tech, it's quite there yet, but it's definitely not far off of sort of handing you something before you're even looking for it. And then, you know.
Brandon Giella (29:20.63)
You
Brandon Giella (29:45.922)
I think a simple example is instead of searching for, you know, best places to travel for summer 2025, which was the way we've been searching these kinds of things for the last 10 years. Now it's opening up ChatgypT, turning on a deep research report and telling it, you know, two paragraphs about you and what you were looking for in your travel. And then it surfaces like, here's exactly where I think you should go and exactly what I think you should do. And that changes, you know, it changes the way people relate to it.
Ian Andersen (30:15.599)
Yeah, right. It takes a lot of the decision-making out of the equation, which again, I could come up with half a dozen bad things because, you know, that stem from that, but I can also come up with probably an equal amount of good things that come from it too. So in the end, you know, it's a tool like any other, it can be used for many different things, but it is going to be.
groundbreaking in the way it causes us to behave with the internet. And Gen Z especially and Gen Alpha and those behind, just the sheer fact of growing up with it and it being such a ubiquitous part of their life are going to have a much different experience than those of us who've lived the majority of our life without these AI tools.
Rachel Satow (31:05.747)
We're getting eerily close to discussing and going all the way down the algorithmic bias rabbit hole. Maybe that'll be another episode.
Ian Andersen (31:11.761)
Yeah. Yeah. Yeah. I wish I had just some tinfoil hat conspiracy. Well, I, it's.
Brandon Giella (31:15.005)
Yeah, yeah, yeah.
Rachel Satow (31:18.345)
You
Brandon Giella (31:18.594)
No, but it does. I think it's important though, because these topics, they are converging. I think to the earlier point we were making, like we're talking about sustainability, we're talking about improvements in technology and AI, we're talking about personalization. And Rachel, I want to get your thoughts on this, the last few minutes that we have here. One of the other trends we were talking about is flexibility, that Gen Z millennial...
Ian Andersen (31:28.537)
Mm-hmm. Exactly.
Brandon Giella (31:46.242)
travelers are looking for in their loyalty programs from brands and I'm wondering if this this converges as well where we're using AI to search for things or hyper personalized we have these sustainability, you know preconceptions and as a result, it's increasing competition amongst loyalty providers or brands or because I'm looking for things that are very unique to me
And my experiences that I'd like or my personalized, you know, needs or desires. And as a result of that, they're, Gen Z and millennials have, lower loyalty than previous generations. And so they're looking for, what you guys were talking about before we started recording was looking for like flat fee memberships, non-travel redemption options that maybe there's partner retailers.
unrestricted redemption options, low commitment models. And I have, I'm thinking of like American Express Platinum. I can go get $200 worth of like Walmart credits, or I can get like audible credits for entertainment purposes. So I'm thinking, are there things like that? Do you think that it's a result of personalization and wanting meaning and experiences?
because of AI, because of sustainability? how does flexibility fit in with this, if at all? Cause I think it does.
Rachel Satow (33:16.957)
Yeah, so.
You brought up an interesting point in that Gen Z and I can only assume that Gen A and Gen B and beyond are going to have the same sort of mentality, but there is that lower loyalty uptake. We were talking about this earlier that for Gen Z, only 65 % of the generation is enrolled in a program and enrolled in a loyalty program, whereas when you look at boomers, it's closer to 90 % are enrolled in programs.
talk about the grand conversation of this is really like that mentality shift between generations. But one thing that's super notable for Gen Z is that they really are impatient driven, and that they want those instant rewards and they want to feel as though they can earn daily rather than having to do like the marathon in order to get to status. So when we think about that and how programs have to take a shift, it's really it stems
to making a lower barrier to entry for your program to capitalize on the people that are in that generation that are wanting to go the loyalty program route, even though, you know, like I said, there is such a small percentage of it. They're having to lower the barrier of entry into the program and into status for Gen Z simply because I can only imagine putting my Gen Z hat on. I can only imagine that if I
to sign up for program. I'm one of the few in my generation that are 50%, you know. If it's now impossible for me to ever earn status, I'm going to stop utilizing that program. I will, you know, go stagnant.
Brandon Giella (34:58.722)
Mm-hmm. Mm-hmm. Mm-hmm.
Rachel Satow (35:03.825)
So I think when we think about this flexibility, we have to take into account the fact that Gen Z and beyond are really going to want to look for instant rewards and simpler redemption options or simpler earn options.
one of the things that makes programs like, I'm gonna call out Starbucks because I go to Starbucks way too often, but one of the things that makes their loyalty programs super successful is that it's very obvious. It's a one-to-one ratio. One dollar spent, one point earned. And I know when I hit...
Brandon Giella (35:37.804)
Yeah.
Rachel Satow (35:39.911)
you know, 25 stars, I can get something small. When I hit 100 stars, I can get something a little bit bigger. It's a very simple process. So I think a lot of loyalty programs are going to have to make the shift for these younger generations to change the way they can earn.
Brandon Giella (35:47.266)
Mm-hmm.
Rachel Satow (35:58.929)
to be more interactive. Is it based on app usage? Is it based on site usage? Is it based on searches? Are you earning as you kind of engage with the brand in other ways outside of actively purchasing, but also being very transparent with how you are earning and how to get to where you want to go. That's going to be vital.
Brandon Giella (36:23.884)
I think the transparency and simplicity points are really important. had a friend that I was talking to just a few months ago. He was a, he's in his seventies. He was a hotel consultant for many, many years. And as you can imagine, he traveled all over the place and he decided to pick an airline, a very large major brand. won't name, but he picked that airline and for like 15 years, put all of his miles on this airline.
And he was like just a few years away from their like lifetime traveler like, you know Highest possible status you can achieve He said he was just a few years away and they changed their value structure And it basically pushed that out another like 15 years for him or whatever it was I can't remember the number but it essentially it was like this great regret that he had in his life as a 70 year old man That he chose an airline and decided to be loyal and they changed it on him so
just like a word of caution if you get into a loyalty, but this is what creates that fear in Gen Z and millennials. Like I don't wanna pick anybody because then they're gonna change it on me and it's inflation in another way.
Rachel Satow (37:27.399)
Right?
Rachel Satow (37:31.26)
Yeah.
Ian Andersen (37:33.125)
Well, and we're seeing that and I don't know, it's probably bit of a like chicken and egg problem, that one causes the other, but the younger generations are not as interested in that status loyalty tier, options and availability, right? Like it is much more about that instant reward.
Exactly where Rachel said right you spend a dollar you get a point I can use those points like there's no after five years you spend a dollar you get a point and a half and after ten, know like that is much less interesting to younger generations than Just the straight transactional if I do this you give me this and that's just the way it is right and And you're absolutely right regarding flexibility
It's important to Millennials, but far more important to Gen Z of like, you know, what if I don't want to book a United flight with my United credit card? What if I want to go to Lululemon or to Kroger or to whatever? And I think that building those partnerships, having various offerings, whether it's a loyalty program or rewards program or whatever it is.
is going to be far more valuable than picking a lane and then giving some sort of tiered structure of an offering.
Brandon Giella (39:15.372)
Yeah, I, I as a millennial have seen my more experienced generations, have some pretty bad experiences with, with choosing, you know, loyalty, whether it's an employer, whether it's this airline example. So it's tough out there and I think we're hesitant. So we want a lot of flexible options. It's probably a thousand stories we could talk about like that and a thousand different ways we could take this conversation. But I think to close it out, I think these trends like flexibility.
personalization, technology, sustainability, they are all converging and they're interrelated. And I think the challenge for loyalty leaders and travel especially is to differentiate, define what that looks like and ensure that their messaging is not competing with these different trends because.
Gen Z and millennials have very keen eyes and a lot of criticism to muster against a brand if they don't get the messaging right. And I think it's a really big challenge, but I think it's important to take up. And so I think loyalty leaders can do a really good job in their messaging and marketing and building these programs if they think about the interrelated nature of these topics.
Ian Andersen (40:29.23)
Absolutely
Brandon Giella (40:30.178)
So I'll end with that. Rachel, Ian, thank you so much for this great conversation. I always love talking to you guys about how you're thinking about travel, because it's so fascinating, like all these different converging points. And I know that you all have a lot of experience traveling, a lot. And so there's a lot of personal relevance as well. So, well, I'm excited to talk to you guys again on the next episode, and we'll see you then.
Ian Andersen (40:54.139)
Awesome, thanks Brandon.
Rachel Satow (40:54.963)
Thanks, Brandon.
Brandon Giella (40:55.34)
Thanks, y'all.
