Points-based loyalty systems, introduced by airlines over three decades ago, transformed the travel industry overnight. The prospect of a free trip to a dream city was enough to entice customers to stay loyal to an airline. It was just that simple.
Alas, those days have passed, and customer loyalty in the travel industry is not what it used to be. With ever-increasing price transparency and easier access to booking, travelers are becoming more loyal to brands that offer the best prices and experiences, regardless of how many points they have with those brands.
Travel businesses now have the chance to create more loyalty opportunities than ever before, opportunities that can be simultaneously tailored for their customers’ and their own needs. When customers leave a loyalty or rewards programme, 70% cite the reason as “the length of time it takes to build up points to earn a reward” (Maritz Loyalty Marketing, September 2014). It is therefore imperative to connect with them afresh at this precise moment in their lifecycle.
Effective digital experiences must align with three types of customer perceptions--or as Forrester puts it, the three Es of customer experience: effectiveness, ease and emotion (Forrester, 2015). For an industry as volatile as the travel industry, it is critical to make these Es a core part of business strategies.
Effectiveness: Make sure your customers get value from the experience
Emirates is experimenting with iBeacons to gauge security wait times, direct passengers to their gates, alert them about boarding times, and even help track their luggage. Starwood Hotels and Resorts is running an iBeacon trial in 30 of its accommodations to enable concierges to greet arriving guests by name, accelerate the check-in process for frequent guests, and let housekeeping know when guests are out of their rooms.
This kind of data collection and analytics is not only helpful in building a deeper relationship with customers for future activities and purchases, it is also changing experience design. Airports can now have real-time information on how to make boarding processes more efficient, and hotels can more cleverly allocate staff around guests’ needs.
Ease: Make sure your customers get value without difficulty
Ease means intelligently illustrating loyalty scheme benefits and what they could mean for your customers, continuously updating them on where they are on the road to becoming one of your most valued customers. Target those just one tier away from achieving the status of the next tier (e.g. from silver to gold), telling them the particular amount of points that will get them an upgrade next time. This will not only increase their likelihood of purchasing on your website, but will also increase customer engagement over the long term.
Emotion: Make sure customers feel good about the experience
Disney has introduced wearable technology as a way of simplifying and gamifying the Disney World theme park experience. Historically, the experience was anything but magical for families trying to navigate the complex theme park. Disney’s insight into this complex experience led to an innovative solution: MagicBands.
These wearable bracelets store park passes, restaurant orders, room keys, loyalty statuses, even credit card information, all in one place. The bracelets seamlessly unify all Disney park experiences and act as a brilliant marketing tool on their own. Though it cost Disney close to $1bn to produce them, the investment has paid off in dramatically simplifying and improving the travel experience for over 30 million visitors to Disney parks each year. Moreover, the bracelets add a whole new dimension of magic to the experience kids have at the parks.
Customer experience is more than a new wave in marketing speak. It is essentially a new way of thinking about business structure and product delivery. The companies that get this right are the ones that will truly be innovative. These will be the successful companies of the future.
For more ideas on how to improve your customer experience and find points of differentiation in travel, download our latest ebook, Beyond price: Turning traditional travel challenges into customer opportunities.