Edition 10: Sept - Nov 2007
Exploiting Customer Loyalty Events By: Felix J. Cruz, Vice President, Marketing Support, Philippine Airlines Mabuhay Miles, the current FFP program at Philippine Airlines, was launched in August 2002. It is an integration of the former Mabuhay Club and PALsmiles, Loyalty Club and Frequent Flier Program, respectively. The Mabuhay Club was one the first loyalty programs set up by an Asian carrier way back in 1982. By the way, “Mabuhay” is Filipino and means “Welcome”. When Mabuhay Club was launched, we had a big launch party at the elegant and historic, Manila Hotel. Mabuhay Club membership card no. 00001 was issued to the then Minister of Foreign Affairs, Carlos P. Romulo, a member of the cabinet of President Ferdinand Marcos, and one of the signatories to the Charter that created the United Nations. Thru the years, there were numerous Mabuhay Nights cocktail parties complete with performers in the major cities in the Philippines, such as Manila, Cebu and Davao. These were also held in major foreign stations we operated, i.e. San Francisco, Los Angeles, Hong Kong, Dubai and Singapore. Already in 1992, PAL recognized that golf was the game of the air traveling population and top businessmen. A scan of the customer profile of our members confirmed this fact. The first Mabuhay Club Invitational Golf tournament was launched. This was the precursor of the current Mabuhay Miles Elite Invitational Golf Tournament. This coming November 2007 will be the 15th annual tournament. The invitation to participate in the tournament is determined by scanning the customer profiles of all the Elite and Premier Elite members who indicated golf as their sport. Invitations are sent out to all of them. In 2006, we sent out 2,000 invitations to members based in the Philippines and abroad. Since, we have already shifted to a three 18-hole golf course facility, we were able to confirm slots for 500 players on a first come first serve basis. The tournament has grown in popularity year on year, from 169 players in 1993 to 355 last year. Since year 2000, the highlights of the event were shown on Philippine television. In 2005, a major Philippine sports cable TV channel has been covering the tournament on a more comprehensive scope. Prizes ranging from First and Business class tickets on PAL, Alaskan cruise, Toyota Camry car for a hole-in-one feat, Adidas sport shirts, Mizuno Clubs, expensive Nokia cell phones, Ferregamo key chains, Kenneth Cole business card holders to name a few were raffled as prizes. All players are gifted with branded sports shirt and sports bag. Sponsors ranging from Boeing, Airbus, GE Aircraft Engines, Petron, HSBC, Philam/AIG Insurance and Philippine Telcos, SMART have been consistently co-sponsoring the event. Definitely, many Mabuhay Miles members have enjoyed and looked forward to attending this annual tournament. Did we, however, achieve our objective of retaining our premiere customers and continue to rack more miles? We reviewed the profile of the participants of three consecutive tournaments in 2004/05/06. We noted that 182 players played at least twice during the three years under review. We checked their redeemable miles as of July 2007 and found out that their consolidated redeemable miles are 12.3M miles. Furthermore, 148 of the 182 players retained their tier membership within the succeeding year of the tournament, while 11 were upgraded from Elite to Premier Elite status and 21 were downgraded. We will continue to review their earning profile in determining the members to be invited. We will scan other elite level members, another 25,500 altogether, specially those rising stars who did not tick off golf in their customer profile form. We will inquire if they play golf. We will no longer determine confirmation of player slots for the tournament only on first-come-first-serve-basis. We will allocate more slots and priority to higher and fast earning members. We will also continue to monitor their miles earning habits after the tournaments. We also noticed that with the substantial publicity we were able to generate about the tournament on TV and from newspaper articles, we got more and more prestigious sponsors, which ultimately became partners in the Mabuhay Miles. The participation of these partners added perks for our members to enjoy and earn more non-flight miles. We will continue to look into other sports, which majority of our members are involved in, and will evaluate the feasibility of having other sports events for our members.
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In this Issue: FFP Online Interview: A Sensible Loyalty Progam with Less than a Million Members Combating the commoditization of the hotel product with partnership marketing How Well do you know your Top Tier Travelers?
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