Ai Video: Evaluating emotional engagement in loyalty

30th January, 2020

A range of KPIs are being explored when it comes to emotional engagement with a loyalty program.

Some areas that are being explored are:

  • How are favourite brands described by loyal customers?
  • What sort of qualities of positive human relationships brands need to emulate?
  • How can new data models incorporate information about these valid questions?

Ai's Ritesh Gupta recently spoke to Piotr Kozlowski, Vice President Consulting, Services Sector, Airline/Travel Loyalty at Comarch about the same.

 

Ai Video: Banking on exclusivity and experiential benefits for loyalty

14th January, 2020

Exclusive rewards, personalized access, a distinguished experience... such initiatives, as indicated by studies, are driving customer loyalty.

It is vital for airlines to focus on the human and digital moments that matter most along the customer journey, rather than just the transactional aspect in order to sustain loyalty.

Scott Robinson, VP of Loyalty Design and Strategy, Bond Brand Loyalty spoke about the same.

By  Ritesh Gupta

 

Ai’s new 2020 conference dates:

http://www.airlineinformation.org/upcoming-events2/370-2020-conference-dates.html

 

Ai Video: Crafting a new financial model for FFPs - what to expect?

23rd December, 2019

Airlines have embraced a number of models over the years to run their respective FFPs - right from being in control internally to forming a subsidiary to opting for a spin-off.  

A number of internal and external factors are assessed before finalizing the model and the structure.

It is time for airlines to look beyond a binary discussion around a model for their respective FFPs - one that is generally centred around whether to go for a carve-out option or not.

Ai’s new 2020 conference dates:

http://www.airlineinformation.org/upcoming-events2/370-2020-conference-dates.html

 

 

Ai Editorial: Superapp model and daily relevance, what’s there to gain for airlines?

17th December, 2019

Ai Editorial: Superapps are now extremely popular in various markets of Asia. Be it for refining their own apps in order to thrive in the data economy or being part of a 3rd party superapp,  airlines need to dig deeper to capitalize on the flourishing trend, writes Ai’s Ritesh Gupta

 

The frequency with which Meituan, a Chinese superapp, or Southeast Asia's highly-used daily services app, Grab,  are used for transactions makes them stand out.  

In case of Meituan, the total number of annual transacting users on its platform grew to over 435 million by September this year. Companies like Meituan are already eliciting over 25 transactions per user annually on an average basis. Grab has had over 150 million downloads. These apps have already garnered the attention of established travel e-commerce players, including Booking and even airlines such as Lufthansa Group. Such companies have been exploring the superapp model.  By being more utilitarian, the likes of Meituan, Paytm, WeChat , Grab, Gojek and others are now described as everyday superapps, with most of them operating at the intersection of hyper-local delivery, commerce, payments etc.  And being in the business for five years or so, these apps have also found their way into a relatively low-frequency buy like hotel accommodation or flights.

In its Online Travel 2020 Report, Travelport has accentuated on the fact that OTAs need to deliver immersive experiences by being where the customer is at every point in the journey. It states that a key threat for OTAs comes from the risk of disintermediation from their customers, as the experience with super apps will likely be better.

Learning from superapps

"Our understanding of travel and mobility is no longer linear and transactional," Gleb Tritus, Managing Director, Lufthansa Innovation Hub (LIH) told me in an interaction in August this year.  Other than shaping the product, LIH is also evaluating how customers are getting into superapps/ ecosystems and how they end up using it. It is important for airlines to learn from such companies as rolling out omnichannel capabilities into legacy systems isn’t a straightforward task.  Learning from superapps would help considering that the fact airlines are evaluating possibilities within the mobility space. They are looking at offering a truly interconnected experience via their own digital assets covering all of the transportation requirements.  A key lies in comprehending how a superapp typically tends to improve the traffic for low frequency products, be it for working on entry points for them on the app interface or via cross-selling.  

Another critical aspect is constantly learning about users and evaluating the quality of recommendations and at the same time ensuring all of such experimentation isn’t a complicated and expensive process. How to set up a viable recommendation engine that not only entail preferences of different users but also trending recommendations or habitual behaviour? At the same time, how to run high-performance, low-latency operations.  For its part, Grab has worked out a microservices architecture set up on data streaming with Apache Kafka. This powers the business as well as paves way for a critical source of intelligence.  

  • It is important to comprehend how a superapp integrates data from multiple applications and sources?
  • How data scientists and other analyst take productive decisions?
  • Eventually how to facilitate these data flows to create an experience that matters?

Travelport underlines that superapps “are well positioned to continuously engage those who are already part of its ecosystem by introducing new features and functions that make the app stickier”.  Also, such apps are leveraging “their data to better target products to customers, at the exact time they need them, and OTAs need to combat this”.

For airlines from their distribution perspective, too, the superapps are a welcome development considering that fact they need to support fragmented distribution, rather than continuously drifting and ending up with a precarious situation where one player in Google ends up controlling the whole travel value chain.

It also remains to be seen how the trend of superapps shapes up outside Asia and lends a new dimension to customer acquisition in the travel e-commerce sector in 2020. A player to watch out for is Airbnb. It is definitely one of those brands that the entire fraternity believes can provide a better answer to the fragmented travel shopping experience. The way Airbnb goes about uniting its staff/ teams across product disciplines, making the most of “creative hacks” or managing complexities associated with product designing, it can provide an answer to when to travel, where to go, and what to do on trips.  

 

Keen on exploring topics related to digital commerce? Ai has planned #AncillaryRevenue Conferences in Berlin, Bangkok and San Antonio in 2020:

https://lnkd.in/fGSVujK

 

 

Ai Video: Curbing loyalty fraud with machine learning

12th December, 2019

Airlines are looking at ways to curb illegitimate access to a member's loyalty account and resulting imbalance in a member’s spending or reward activity owing to hacking.

Considering the fact that demand for stolen loyalty currency among the fraudsters or in marketplaces on the dark web is on the rise, the role of machine learning in monitoring high-risk behaviour at account access, purchase and redemption of points/ miles is coming to the fore.

Important aspects that are being explored:

• How to leverage data from the entire loyalty platform ecosystem?

• How to define an apt fraud score limit that points out unusual behaviour?

• How to prepare to identify unrecognised anomalies in transactions?

• How to cut down on the rate of false-positive cases that require manual reviews?

Binay Warrier, Head of Business Development, Loyalty and CRM at IBS Software, spoke about the role of machine learning in keeping a vigil on loyalty fraud.

 

Ai Video: Nurturing loyalty via positive emotion of being rewarded

6th December, 2019

Airlines are evaluating ways to sharpen their respective loyalty cycles, i. e. letting a member earn and burn faster. What makes the game interesting today is how airlines are looking at including members with relatively lower spend or loyalty currency in this cycle.

As airlines dig deeper, they are evaluating a couple of areas for redemption -

  • How to make a loyalty program relevant to the entire spectrum of members, depending upon how frequently they travel or how much they spend?
  • Offering non-core redemption in order to diversify - a choice of merchandise, gift cards, experiences etc.

 

Ai Video: Winning loyalty by being more than an FFP

27th November, 2019

How are U. S. carriers looking at making their respective loyalty programs more attractive?

Full-service airlines are not only looking at strengthening their ties with their most frequent traveller base, but they are also evaluating ways to make the entire earn and burn cycle luring for the rest of the members, too.

Ai Video: Counting on subscription service for loyalty

 

20th November, 2019

Various companies in the travel sector, including airlines, are looking at a subscription-based offering.

Be it for the idea to the development process to managing a subscription product, its technical complexity and above all, the passenger experience, airlines are working on every aspect to excel in this arena. It is heartening to hear that airlines, too, intend to let passenger finalise their own subscription service in the future.

A critical aspect is to not only interact and recommend products for a personalized experience, but consider the delivery of unexpected and unadvertised rewards to look at loyalty in a new way. Experienced loyalty executive Dave Canty shared his viewpoint about the same.

Ai’s new 2020 conference dates: http://www.airlineinformation.org/upcoming-events2/370-2020-conference-dates.html

Ai Editorial: Can infrequent travellers turn out to be the most loyal segment?

11th October, 2019

A recent podcast on loyalty, featuring Joanne Ward, David Canty, David Feldman, Alan Lias and Iain Pringle, discussed the significance of less frequent flyers, and how can they propel a loyalty progam even further.

 

Airlines are trying to dig deep to ascertain what a loyal member looks like beyond their own purchasing funnel. As highlighted in a recent interview with airline loyalty and big data expert, Mark Ross-Smith, if there is not much activity in the air, then why not be a part of an infrequent or a price-conscious traveller's life via activity on the ground? This consideration is starting to stand out in a striking manner in the case of low-cost carriers (LCCs) and how they are going about managing their loyalty programs.  

A lot depends upon the business model, destinations covered etc., but typically looking at any loyalty program 80% of the members, if not more, tend to be infrequent flyers or guests. “Obviously they aren’t bringing in the same average revenue per member when compared with other top members they are still a huge group. It is imperative to assess what’s there in a loyalty program, other than price, that can add value, be it for any benefit or contributes in differentiation of the program. They are mainly leisure traveller in most cases,” mentioned Joanne Ward in the podcast.

Podcast link - https://lnkd.in/e5NE7vd

Alan Lias mentioned that it is important to assess what sort of “other” behaviour is relevant to a travel business. It needs to be assessed - are the travellers genuinely infrequent in terms of what any airline has to offer and if they are how does one create relevance for them. By looking at other things they are doing in their lives and by focusing on partnerships how can airlines end up being more relevant in such flyers’ day-to-day lives and potentially help them in achieving their goals. 

It was also highlighted that those who fly infrequently with one airline might be flying with other airlines too. Also, a top member of one FFP possibly can have a similar status with another airline. Also, those who are part of a lesser number of programs offer an opportunity to be engaged. Are infrequent flyers more loyal? 

A leisure carrier flying to leisure destinations, featuring infrequent travellers, has the opportunity to foster loyalty.

“Infrequent travellers may be most loyal (in the sense they are giving you a sizable chunk of their wallet). They may be flying infrequently, but they may be flying exclusively with an airline,” mentioned David Canty, from his own professional experience in the loyalty arena. Delving into it, he mentioned that by bringing redemption earlier in the cycle in a program  and allowing them to redeem a lot quicker, the audience did look out for travelling again with the airline.

As for those travel brands that are focusing on infrequent customers, David Feldman highlighted Hilton’s approach towards opening up their loyalty program. It was referred to as an example (offering members the ability to pay for purchases at Amazon.com using Hilton Honors Points). Southwest was also picked for their penchant to offer value and serve infrequent travellers.

The attractiveness of a subscription-oriented progam was also discussed. One example is Mexican low-cost carrier Volaris’ decision to embrace the subscription model, v.pass.

“(It is seemingly) starting to make a re-entry into a new generation and something that’s resonating,” said Canty.

Agreeing with the same, Joanne said that Amazon has played a vital role in the same with Prime. A lot of retailers are also looking at that. “If you charge something to be a part of a programme, members can be given certain benefits that means more to them. Also as a member for spending $100 on annual membership you want to make sure that you are also getting something back,” she said.  

Iain Pringle referred to two set of loyal customers - spenders and savers - one set is all for instant gratification (spenders), and the other tends to save for long-term rewards (savers). A balance has to be attained in a program to appeal to both the set of customers. 

Some of the key points that were highlighted:

  • Understand the profile of infrequent travellers and what’s driving them? They can’t be ignored. Even one or two incremental transactions from this group can make a huge difference.
  • Test and learn with “inactives” members of a program.
  • Leverage data a lot more than what is being done at this juncture. Use it in a way that makes the entire exercise meaningful.
  • Be brave, take risks – go beyond the traditional ways of engaging customers. Be ready to evolve your loyalty program. 
  • Work out a compelling reward proposition
  • Assess the lifestyle, look at other things members are doing in their lives and take initiative, including through partnerships, in order to be more relevant to them
  • Clear communication – show them the goal, how it works, show it is attainable and share the next step 

By Ritesh Gupta

Ai Correspondent

 

Join David Canty, David Feldman and a host of other specialists from airlines and in the loyalty arena at the upcoming #MegaEvent, to be held in St Petersburg, Florida (29th–31st October) this month.

https://lnkd.in/fcdy7-U

 

Ai Editorial: Friction in CX is necessary, just focus on the right type

8th October, 2019

From a travel retailer's perspective, having the right type of friction, with the right action, at the right time is imperative, writes Ai’s Ritesh Gupta

 

Planning a trip and travelling can’t be termed as one experience. There are multiple sessions and in all probability multiple devices that encompass the planning, buying and consumption of the travel product.

Travel e-commerce players need to find ways to curb friction, especially in cases where one is returning to access an app/ or an account, or where a traveller isn’t able to enjoy an integral feature (like being able to select a seat and pay for it only via a PC and not via a mobile app/ site!).

One of the areas that e-commerce players have been focusing on is trust data from early on, and counting on the same to mitigate risk for future interactions. If travel companies aren’t prepared for the same then they won’t be able to accelerate transactions from returning customers or being in a position to block fraudsters using spoofed or stolen identities,

Before delving into the same, let’s understand why friction shouldn’t be looked upon as a dreadful word.

What is friction?

As LexisNexis Risk Solutions highlights, a frictionless customer journey “doesn’t equate to an absolutely friction-free experience. It’s about having the right type of friction, with the right action, at the right time. You have to figure out where and what that is”. From a shopper’s perspective, friction could be any feature or requirement that hinders their path through the sales funnel. It could be a compulsory registration, wearing form-filling and time-consuming authentication processes.

  • Authentication-related friction: For avoiding fraudulent transactions or checking whether the user is genuine or not, it has to be ensured that unnecessary steps shouldn’t be added. Authentication without proper context only prolongs the session, takes more time to complete a task. In terms of not being a victim of any sort of fraud, LexisNexis recommends an “application of digital identity paired with thoughtful risk-based use of other risk solutions such as decision analytics, verification and authentication, and where necessary, investigation and review products.” A unique digital identity for each user is based on analysis of many connections between devices, locations and anonymized personal information. Behaviour that deviates from this trusted digital identity can be identified in real-time. Travel retailers need to introduce identity validation measures only in questionable transactions. Also, if a verification measure has to be adopted, the most convenient ways must be introduced. Riskified’s data indicates that more than 80% of online shoppers respond to SMS confirmation, as opposed to a response rate of only 51% to emails. A  fraud prevention offering should be scalable and dynamic, efficient at evaluating a number of factors, and worked out for  sustained improvement based on valid and verifiable metrics.

  • E-commerce-related friction: Other than authentication, other areas of friction that all retailers tend to avoid are related to discovery (refrain from giving consumers more choices than ever before), transaction (for example, non-mobile-optimized checkout experience, non-availability of the preferred payment method, failure in transactions etc.) and post-purchase.

Some recommendations include:

  • Let shoppers complete a transaction without pressing them to sign in or create an account. Forcing that information up-front is one of the biggest obstacles to customer conversion  
  • Cut down the number of form fields in the checkout flow
  • Make forms as simple as possible
  • Share an outline of the checkout process
  • Feature copy and visual signals/ cues
  • Try modal windows or accordion interfaces rather than external links
  • Don’t forget to display a confirmation page
  • Offer shoppers every reason to come back
  • New initiatives: Airlines are looking at new programs to ensure they not only come up with enticing offerings for repeat purchases but also to wrap up an interaction in a speedy manner, including the transactions.

For example, the trend of subscriptions. It today goes beyond Netflix and Spotify. Mexican low-cost carrier Volaris’ decision to embrace the subscription model, v.pass, exemplifies the same. Be it for the idea to the development process to managing a subscription product, its technical complexity and above all, ensuring the passenger experience isn’t diluted, the airline asserts it is making progress. It is counting on possible benefits – thriving on data of members, stepping up the ancillary revenue generation etc. Just like retailers, travel brands are curating offers or offering incentives to travel shoppers to return and complete their transactions in a frictionless environment.

  • Integration with 3rd party apps: Also, for those travel shoppers who are used to using 3rd party apps, there are ways to integrate their offerings and in turn taking caring of pain points that are associated with shopping. This is a reason why digital wallets are attractive to buyers. Private authentication from biometrics (fingerprints or facial recognition, for example) as well as secure encryption and tokenization of payment information are a few reasons behind the same.

 

Interested in loyalty-relatd topics? Join Ai at the upcoming edition of MegaEvent, to be held in St Petersburg, Florida (29th – 31st October)

https://lnkd.in/fcdy7-U

 

Editorials

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    21st February, 2020 Ai Editorial: Security safeguards and privacy-related initiatives are becoming stronger. Biometric authentication is an interesting tussle, and the industry is looking at negating fraudsters/ hackers’ moves, writes Read More
  • Ai Editorial: Are acquirers becoming stronger allies for merchants? +

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  • Ai Editorial: Focusing on agile transformation with a pragmatic approach +

    14th February, 2020 Ai Editorial: Airlines and even organizations from other sectors in their journey of agile transformation show common characteristics. Plus, there are common pitfalls and challenges to learn Read More
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