The age of instant gratification
BUILDING relationships
takes time, we’ve been
told, and maintaining
them requires dogged
perseverance. But that slow
process is not satisfying
today’s impatient customer
who wants instantaneous
rewards from the outset.
For demanding customers,
the long-term activity
of collecting points is
laborious, but an immediate
gesture of recognition
makes them sit up and
take notice. Suppliers
and service providers are
offering perks from the very
first website contact.
In reaction to these
conditions, an improved
Premier Rewards programme
will be launched in the next
few months.
Mark Jakins, group sales,
revenue and marketing
director of Premier Hotels
and Resorts, expands on
the pressures the travel
industry is up against.
“This sector is led by the
medical, insurance and
financial giants such as
Discovery, Investec and
retail programmes offered
by Pick n Pay, the Edcon
Group and Woolworths. As
such, airline and hospitality
groups are competing with
much bigger and betterestablished consumer
loyalty programmes, all of
which offer instant rewards.
“To stand out we need
to offer instant hospitality
benefits as opposed to
long-term loyalty points
that must be accrued. In
our experience, expedited
check-ins, room upgrades,
food and beverage offers
and additional amenities in
rooms are winners.”
But even these offers
only give parity in a
crowded space, says Mark.
“To have a real point of
differentiation and increase
our market share we are
also considering strategic
partnerships to offer our
business, government and
leisure travellers a more
diverse value-add, which
is absolutely imperative
in today’s tough economic
climate.”
Comair, a franchise partner
of British Airways, taps
into the benefits of BA’s
Executive Club programme
and the oneworld alliance.
Brian Kitchin, Comair
executive manager: sales
and distribution, says:
“Frequent flyer programmes
are multi-layered as
they also partner with
various hotel and carhire companies, as well
as retail and financial
partners. This allows greater
opportunities to earn and
redeem rewards, therefore
gratification is more instant,
and the cycle of redemption
is shorter.”
Cruise lines have
responded to this with
benefits from the very first
cruise a traveller takes, says
Roland Müller, marketing
manager of Development
Promotions. “You start
earning rewards after your
first cruise with quite a few
of our brands – Norwegian
Cruise Line, Oceania
Cruises, Regent Seven
Seas, Holland America and
Hurtigruten.”
Coach touring brands like
Topdeck and Back-Roads
Touring offer past-guest
discounts, an incentive to
use the company again.
Something more
By its very nature, travel
is not about instant
gratification, says Lance
Smith, executive: sales of
Avis Budget Rent a Car.
Travel, the most-used reward
in most loyalty programmes,
he notes, is for most people
a planned annual event.
“That said, most loyalty
programmes would state
that at the entry level of
their programme, spending
on day-to-day items such as
airtime, fuel and groceries
is growing.” Avis’s ClubRed
programme for travel
consultants, from the day
of inception enables agents
to decide whether they want
long- or short-term benefits.
Wouter Vermeulen, gm of
Air France KLM Southern
Africa, believes that while
short-term rewards are
important, long-term
recognition for loyalty
remains a priority for Flying
Blue’s upper-tier frequent
flyers (Platinum, Gold and
Silver). Nevertheless, the
Flying Blue programme was
reinvented in April 2018 and
now offers instant benefits
to entry-level members (the
Explorer tier) in the form of
an immediate discount of
up to €10 (R165) on the
first paid bag, and a 10%
discount on seat options.
These members can start
earning four miles per euro
paid on tickets for their very
first journey.
“Our elite members
(upper tiers) still benefit
from rewards such as Sky
Priority, lounge access
and additional baggage.
Additionally, all tier
levels can make use of
promotional awards where
the airline discounts certain
city pairs by as much as
40% in some cases,” says
Wouter.
For Europcar, the key to
building loyalty is tailoring
products to different
segments with appropriate
benefits. “One size no
longer fits all,” says chief
commercial officer, Martin
Lydall.
Europcar’s direct online
customers are able to
register for the Drive
Club product, including
20% off every rental,
upgrades on every third
rental, and a number of
exclusive promotions
and competitions. In the
corporate and government
space where speed of
service is imperative,
Europcar offers Ready
Service – customers bypass
the normal counters,
allowing them to be gone in
30 seconds.
Enhanced features
For the SME, Business
Connect offers enhanced
features for smaller
operators, including access
to easy-to-use online
booking tools. Customers
do not require a credit card
for rental collection and also
have access to the express
Ready Service. Europcar
further offers an exclusive,
invitation-only platinum card
programme that includes a
dedicated platinum support
service, 24-hour call centre,
discounted rates, vehicle
upgrades and guaranteed
vehicle availability. Cars
are pre-checked and
conveniently parked close to
car-rental kiosks.
Competitor or opportunity?
TRAVEL agencies have
long carped about
competing with dominant
loyalty and reward
programmes such as
Discovery Vitality and
Investec Rewards. Both
offer their clients travel at
attractive rates, deemed
by many in the trade to be
hard to match and thereby
unfair competition.
Sean Hough of Private
Banking, Investec, is
involved in setting up a
new leisure contact centre
where Investec clients
can book travel. “To be
honest,” he says, “most of
the rates we negotiate are
the same as the rest of
the industry.”
On occasion, he says,
Investec will subsidise or
negotiate a tactical deal
– for example a special
offer where airlines lower
prices on flights that are
not filling up.
But Investec’s point of
differentiation, he says, is
on service and customer
experience, and they also
have exclusive products
such as insurance cover.
Kirby Gordon, FlySafair’s
head of sales and
distribution, explains
the workings of these
large loyalty programmes
and indicates that there
are opportunities for
travel consultants in
the scenario. “Generally
speaking, these loyalty
programmes will
approach travel brands
and offer them the
chance to participate in
their programmes as a
marketing opportunity.
Instead of paying a media
fee, the brands must offer
a discount to the loyalty
scheme.
“Flight benefits are one
of the few exceptions.
Flights have been proven
to be so fundamental to
these loyalty programmes’
success that the
programmes usually
fund the flight discounts,
either entirely or with
some, usually minimal,
assistance from the
airlines.
“Understandably this is
a threat to travel agents
(both traditional and
online travel agencies)
that do not have a
‘parent’, like a bank or
insurance company, that
is prepared to subsidise
these flights. That said,
these loyalty programmes
are not travel companies,
and they usually need
the assistance of another
party to execute their
offer, so opportunities
exist there.
“In general, the customer
experience is also not
quite what one would get
from a travel agent with
the wealth of knowledge
and insight that agents
bring, so there is still a lot
of opportunity for agents
to fill in those gaps.”
Mladen Lukic, gm of
Travel Counsellors SA,
offers a consultant’s
view of loyalty schemes.
“Vitality, Travel by
Investec, or any other
loyalty programme,
perform a very
different role from
the one performed by
a professional Travel
Counsellor. Today most
loyalty programmes will
have a travel offering.
While from time to
time we are obliged to
facilitate bookings for our
clients under a loyalty
programme, we do not
see them as a viable
distribution channel.”
Mladen adds: “All
loyalty programmes are
designed to reward their
membership base with
access to products and
services at a discounted
rate. However, this is only
possible for a pre-selected
product range under strict
terms and conditions and,
as such, this offering will
continue to be limited and
restrictive.”
Premier Hotels and
Resorts’ Mark Jakins
feels loyalty programmes
traditionally work best
when co-operating smartly
with other industries.
Premier Rewards will
be working with other
programmes that already
reach hundreds of
thousands of people
fitting the travel profile,
where members are
offered special rates from
travel industry partners
such as airlines, hotels
and car-rental companies.
Premier Rewards already
has a large customer
base, and now that the
Faircity Hotels are part
of its family, it is poised
to ramp up its loyalty
strategies across all 24
properties with significant
technology updates, better
customer interfaces and
ease of usage.
Great value
Europcar is a Discovery
Vitality partner. Martin
Lydall says the car-rental
company recognises
the great value this
programme and others
offer their customers.
“At the same time,
Europcar identifies with
the great value in the
travel agent offering
and the unique services
offered by the travel trade.
We actively support our
travel partners and our
discretionary rates and
associated benefits are
competitive. There is also
a significant opportunity
with package rates and
other benefits and value
offered by the travel trade
to the end user which are
mutually beneficial in the
partnerships we enjoy with
TMCs,” he says.
No expiry on United Airlines miles
UNITED Airlines’
MileagePlus award miles
no longer have a limited
shelf life. Expiry dates on
the programme have been
dropped.
Highlights include:
Travel to more than
1 300 destinations
through United and
Star Alliance partners,
bookable on all airlines
through the United
mobile app.
The ability to use miles
for eGift cards when
purchasing through
MileagePlusX.
How to keep agents loyal
LOYALTY and incentive
programmes for travel
consultants are used
by several principals to
incentivise the local trade.
In July, World Leisure
Holidays re-introduced its
travel consultant incentive
programme, Corals. Marlin
Magadani, marketing
assistant, says: “For every
R100 000 of revenue
generated, the consultant
will earn one coral. Each
coral has a value of
R1 000. Once 10 corals
have been earned, the
consultant can start
cashing them in, for part
or full payment toward
accommodation, transfers,
flights and tours, in any
one of WLHs’ hotels
in Mauritius, Maldives,
Zanzibar and Mozambique.”
From time to time,
consultants will be able to
earn double or triple corals
for certain properties.
A current incentive is for
Shangri-La Le Touessrok
for bookings made
between September 9
and October 31, for travel
between December 1,
2019 and January 10,
2020. Each R100 000 in
accommodation booked
earns the consultant three
corals instead of one.
Avis’s ClubRed rewards
programme for SA travel
agents awards them
ClubRed Roses that can
be exchanged for ebucks
or cash. “The fact that
ClubRed continues to grow
its membership every
year is testimony that it is
still relevant to our travel
community and to us,” says
Avis Budget’s Lance Smith.
Similarly, Europcar offers
Bluebucks, specifically for
the travel trade, where cash
rewards and incentives are
based on rental volume.
Loyalty programmes aimed
at the sellers always run
the risk of introducing bias
that may not necessarily
best represent the interests
of the client. Says Travel
Counsellors’ Mladen Lukic:
“Travel Counsellors are
trusted, independent travel
advisers. It is essential for
our success to maintain this
independence so that our
clients can continue to trust
us. We only participate in a
rewards scheme that will not
try to dictate exclusivity, nor
will it be for a sub-standard
product.”
Educationals remain
the best agent incentive,
although they are not as
plentiful as they once were.
Development Promotions’
Roland Müller says: “From
time to time we do get
offers of educationals from
our brands and we are then
able to reward or inspire
some of our loyal supporters
with a spot on these trips.”
For example, the top 10
Norwegian Cruise Line
bookers between June 20
and September 30 were
entered into a draw for
Norwegian Jade’s six-night
cruise ex-Singapore on
December 15, with
R10 000 toward flights.
Until January 31,
G Adventures is offering
participation in its annual
Change Makers Summit
in a destination still to be
revealed, based on number
of sales, social contribution
and surprise challenges.
The event is expected to
take place in mid-2020.
Mark Jakins says Premier
Hotels and Resorts already
offers regular educationals
and, in response to
requests from the travel
industry, is evaluating future
programmes with a focus
on B2B and B2C. “This will
be launched with the newly
improved Premier Rewards
programme in the next few
months,” he comments.
Future shake-up in car-hire loyalty
THE advent of electronic,
autonomous vehicles
will bring a far-reaching
change in car-hire loyalty
programmes, the form of
which will only become clear
as the sector takes shape
and form.
So says a forward-gazing
Lance Smith of Avis Budget
Rent a Car, SA. He predicts
that car ownership will give
way to on-demand services
secured through apps, much
like “an Uber without a
driver”.
Lance draws an analogy
to the evolution of musical
entertainment, once
received via gramophones,
record players and vinyl,
tapes and tape decks
followed by CDs and now
downloadable to digital
devices and through audio
streaming.
The worldwide sale of
electronic vehicles is
now said to have passed
the two-million mark and
the media continuously
track driverless vehicle
projects being pursued
by car manufacturers
such as Tesla. Lance’s
fascinating glimpse into
the future foresees a time
when drivers will become
obsolete, giving way to
apps enabling consumers
to order an autonomously
driven vehicle as and when
required.
“At this stage, no one
knows who the suppliers
will be, or where customers
will be able to get their
vehicles from,” says Lance.
“There are many possible
sources – travel agents,
tour operators, car-rental
companies, airlines, loyalty
programmes, search
engines and technology
companies.”
This changing landscape
has major implications for
mobility as well as the
format of loyalty
programmes as they
currently exist. The
traditional pattern of miles
for bookings will have to be
overhauled but just how the
chips will fall will take time
to become clear.
Did you know?
Legacy Group Holdings has entered the retail travel space
with the launch of online travel agency, Lifestyle Travel (see
TNW September 11). Lifestyle Travel is the travel fulfilment
partner of the Legacy Lifestyle rewards programme and
members can earn Lifestyle Rands on travel purchases, and
at 270 brand partners, using them as full or part payment
on further Lifestyle Travel products. “The new platform
enables users to create a personalised single or multi-city
trip by picking and choosing from a variety of different travel
providers,” says William Botha, gm.
The latest in loyalty
SEVERAL changes to loyalty
programmes have been
announced recently. Here’s a
round-up of some of them:
Mango’s new loyalty
rewards programme,
GoRewards, typifies the
‘instant gratification’
trend, allowing
passengers to access
rewards within 24 hours
of ticket payment. For
every flight booked,
customers are entitled
to three rewards up to
the value of R2 000,
which doubles for a
return flight. There are
six categories of awards
all based on experiences
– entertainment, days
out, dining, fashion,
pamper options and
accommodation vouchers.
They are valid for a
month after flight date.
Passengers receive an
SMS or email with a
unique code that must be
used to redeem awards.
Members of Etihad’s
loyalty programme, Etihad
Guest, can now earn
Etihad Guest Miles when
booking accommodation
through Booking.com on a
special co-branded version
of the website. Customers
earn between three and
six Etihad Guest Miles for
every US$1 spent. The
miles are awarded eight
to 12 weeks after the
guests complete their stay
and can be redeemed for
flights and upgrades or
gifts from Etihad Guest’s
Reward Shop.
Delta Air Lines has
joined BlueBiz, Air
France KLM’s loyalty
programme designed
for small and medium
enterprises. Kenya
Airways is also a partner
in this programme.
Members can earn
both Blue Credits and
Flying Blue Miles on one
ticket. BlueBiz makes
it possible for SMEs
to gain some of the
benefits of a corporate
recognition scheme on
a scale more suitable to
their needs and travel
habits.
The Travel Corporation
(TTC) introduced a twotiered reward system
across its brands –
Trafalgar, CostSaver,
Insight Vacations, Luxury
Gold, Uniworld, U River
Cruises and Contiki. Tier
One recognises guests
who have travelled up
to four times with any of
the brands, with benefits
such as priority access,
discounts of up to 5%
on some departures, 5%
off newly released trips
for a limited time period,
and special recognitions
during a trip. Tier Two,
for those who have
chalked up five trips
across TTC brands, can
expect the same rewards
on any trip in any
destination at any time.
Travel advisers and sales
managers benefit, too,
from offers that drive
repeat bookings.
Marriott’s Bonvoy loyalty
programme has adopted
dynamic pricing. At peak
times, members pay
14-33% more for an
award night, but in offpeak periods they are
offered discounts to the
equivalent amount. For
example, in category
one, where the standard
rate is 7 500 points, the
peak rate will be 10 000
points, dropping to 5 000
points in off-peak. There
are eight price categories
in all. Meanwhile the Your
World Rewards partnership
between Marriott Bonvoy
and Emirates Skywards has
been relaunched. Marriott
Bonvoy Gold Elite, Titanium
Elite and Ambassador
Elite members earn three
Marriott Bonvoy points
for every US$ or foreign
currency equivalent spent
on eligible Emirates flights,
in addition to Skywards
points. Emirates Skywards
Silver, Gold and Platinum
members earn one
Skywards point for every
US$ or foreign currency
equivalent on stays at
Marriott Bonvoy hotels and
resorts.
Qantas is making changes
to its loyalty programme
and these will apply to
the South African market.
Members will pay lower
fees for international
reward flights and have
access to more seats but
will need more points for
upgrades and premium
cabins. The airline will also
introduce a new loyalty tier.
