With Monday’s announcement regarding its switch to a revenue-based frequent flier program, American Airlines has joined Delta Air Lines and United Airlines. (Those three do sure do a lot together!) The great American airline triumvirate has spoken: we are valued for our wallets. But they’re not alone - all the other major players – Virgin, JetBlue, and even the everyman’s best friend, Southwest, have already made the plunge.
It’s a sign of the times, a shift in consumer loyalty schema that would only make Adam Smith happy (albeit The Wealth of Nations might resonate more today if it were The Wealth of Corporations). Corporations have gained personhood status while the value of the individual loses ground daily.
More important (or at least more pressing) than the social implications of the de-personalization of loyalty acknowledgement is this: If you earn status because of how much cash you spend, but the cash you’re spending is not your own, are you likely to spend more?
Put another way: your corporate travelers have to travel. Now they have a shiny new incentive to maybe not search so hard for the lowest available rate, or comply with the suggested corporate rate or class of service or even preferred carrier.
Okay, fine. Your travelers are not all conniving hooligans out to score the perks that status brings, from pre-boarding privileges to club access. But it can be a struggle convincing them to consistently book in-policy through your designated TMC, and acknowledge the subtle suggestions in your non-mandated program, like, “Business Class is only allowed on trans-continental flights,” and, “If the one-stop flight is $200 or more cheaper than the direct, book the one-stop.”
The airlines – although bursting with ingenuity when it comes to determining ways to limit rewards redemptions (in all things: profitability first) – haven’t really discovered a way to recognize that the people earning these rewards by logging all these miles are just that: PEOPLE. The first members programs had nothing to do with how much you added to the bottom line, but rather the fact that the flight attendants on your trusty commuter-routes all knew your first name and the names of your children because they spent so much time with you. Members programs were once based on members, not the bottom line.
Okay, maybe we’re being harsh. Financially, it makes sense. Honestly, we can’t fault the airlines for the new revenue-based rewards model. Most rewards programs are now predicated on the almighty dollar, right down to the emailed promo code that online retailers send right after you spend inordinate amounts of money at their store. It’s just the way of the world: spend more to get more.
But the question remains: how do you incentivize your travelers to adhere to your travel policy (if it’s not mandated), book with your preferreds, and/or still seek the lowest fare?
Here are a few basic suggestions:
Have new travelers sign up for your Preferred Vendors’ rewards programs. No, you don’t want them booking First Class everywhere, but you certainly want them to book with your preferreds, which will help you when Negotiation Season starts in a few months.
Everybody loves a team player, and people like to be team players, too. Whether you program your online booking tool to default to your preferred vendors or not, make sure your travelers know you have preferred carriers.
Why do you have a preferred carrier? How much money, on average, is spent on your airline tickets? What’s the lost savings? You can easily find this data in WorldReports™, so consider a small awareness campaign that shows your travelers the cost benefits of booking in policy. You might not start giving out rewards for the savviest cost-saving bookings, but telling people WHY your policy exists is a great way to get them on board the thrifty train.
Have a suggestion for encouraging policy compliance? We’d love to hear it! Share in the comments section below.