Ai Editorial: Big Data = Good Data?

Combining all valuable data sources into one customer hub – how to make it work?

What’s impeding the effort of airlines to fully capitalize on the prowess of personalization? Ai assesses the same, featuring recommendations from Boxever and OpenJaw

Advancements in data analytics and how the same paves way for understanding the intent of the customer is one area that is being followed closely.

As Datalex’s CEO Aidan Brogan puts it, the effort is in combining all valuable data sources into one customer hub and ensuring that the commerce system can turn an insight into an offer.

It is also vital to ensure that passengers are duly recognized across every digital touch point. In this context, it becomes imperative to have a single view of the customer. But then there are still hurdles in attaining the same.

Ai’s Ritesh Gupta spoke to senior industry executives about some of the crucial areas related to personalisation and analytics: 

  • Being data-driven

Boxever’s CEO Dave O’Flanagan explains there are several key points to being data-driven:

1) Understand why you’re doing it. There’s no point in building a large repository of data unless you’re clear on the RoI and can clearly demonstrate the business value to your organisation, which can be direct revenue, says O’Flanagan.

2) Start small. Deploy the solution in your digital channels first, focusing on minimizing integration while and maximising impact. “We find that web, email and mobile are great places to start then expand to call centre, operations, in-flight and beyond. This allows you to build the business case to deploy the solution across your organization,” says O’Flanagan.

3) Hire the best talent. O’Flanagan says data is useless without people to help you understand it and translate the insights into personalized customer experiences. 

4) Align your organization. Omni-channel can mean omni-department for your organization and key functions will need to work together to make it a reality. “We’ve found that the organisational challenges in achieving true omni-channel are every bit as difficult as the technical ones,” says O’Flanagan.

  • Single customer view – dealing with silos

O’Flanagan says, “In our experience the toughest part of creating a single view of the customer is that it requires many departments to work together for a common purpose.”

He says coordinating this against other priorities, aligning on common goals, allocating resources, defining ownership of the new SCV (single customer view) - these are all new efforts for many of these departments, who have traditionally worked within their own silo. “Orienting around the customer really means transforming how the company thinks about its data, resources, and operations. Part of Boxever’s approach to addressing this challenge is helping companies understand the organisational as well as the technical challenges to doing this,” says O’Flanagan.

Mark Lenahan, VP of Product Strategy at OpenJaw says the biggest barrier to a single customer view is the persistence of technology and corporate silos, per customer touch point, as opposed to the creation of a single platform for retailing.

According to him, a single platform is one where the airline can leverage its buying power to present any product in any channel. “For example, contracting a hotel takes effort (direct connect or channel manager integration takes a different kind of effort), but why repeat it for every airline brand and again for the holidays company and again for the loyalty program?” questions Lenahan. He further probes and says: from the customer’s point of view, why are they seeing entirely different hotel products on the website than they see on the website, or the website, and again on board the plane? Why are they seeing different offers in-line, before they ticket, than post sale, after they ticket, pre-departure and on-board? 

“I'm not saying every product must be visible in every channel. What I do believe is that the decision of what products to offer where should be a business decision, not a technical one,” he says.

At this point, not only do very few airlines have a true multi-channel single-platform approach to travel retailing, they also don’t have corporate structure to support retailing. There isn’t a single person who can own the business case for a product across all channels - direct/ indirect, web/ mobile, holidays, loyalty, on-board, at destination etc., added Lenahan.

  • Identifying a customer

Technology is making progress when it comes to identifying a customer in the multi-device environment.

“My view on this is that the suitability of probabilistic methods depends on what you are going to subsequently do with that assumption of identity,” says Lenahan. He says if you are using aggregate data to discover patterns in consumer behavior, probabilistic is probably fine within error bars that your data scientists and analysts will understand. “Likewise if you are targeting advertising, you only need a good percentage of hits, and even the misses are quite likely to be similar people,” he says. “Although it is based on cookies, I like Amazon’s multiple levels of authentication. They welcome you back with an assumption, but you still need to deterministically “log in” to view account details or complete an order.”

Lenahan says he also thinks customers have a right to some transparency here. If a consumer has a reasonable expectation of anonymity and they are not in fact anonymous, the airline risks some reputation damage “if they abuse that and get caught,” warned Lenahan. “There should be a way for any consumer to see the standard, anonymous market price for example. I think common sense will prevail, and no matter how clever you think you are as a retailer, you can't outsmart a market (in the long run) and you shouldn't try. Ultimately, retailers work for the customer not against them and they mustn’t forget that,” he said.

O’Flanagan says right now the strike rates for generic matching based on cookies, IP and other environmental factors are pretty unimpressive but if you can look at booking information, search behavior and other travel-specific factors the match rate increase significantly and this is where travel-specific solutions have the edge.

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Ai Editorial: Do you know what your FFP member is looking for?

The onus is on airlines to make the most of customer data and information they have, and integrate it with every aspect of their FFPs. We find out more in our chat with Deborah Merrens, head of marketing, Global Blue

From A Traveller’s Lens

A disjointed experience or even letting loyal customers question the prowess of airlines in recognizing them are some of the bigger issues that FFPs are facing today. The game has moved on from just worrying about redemption or chasing a particular status.

Loyalty programs need to come across as our able ally. Just the way we expect simplification and automation in the most of tasks we are doing today, one would expect airlines to churn out “surprise and delight” experiences driven by their data infrastructure. So say as you access your next flight schedule on your preferred mobile app, a link pops up that ends up offering you a deal for a hotel room that you had searched for 24 hours ago! Yes, today’s travellers love surprises, don’t like to go through mundane routine associated with a trip etc.  

Airlines need to spot ways how to do so and if it can be monetized then it can lend a new dimension to the concept of loyalty.

Here we hear from Merrens about how according to her loyalty is evolving. Excerpts:

Ai: If you were to assess loyalty as air passenger, what makes you happy?  

Increasingly it’s about personalising the experience for me rather than collecting more miles or chasing status. (So be it for) making it easy to check in, get the seat I want, board when I want, or get the baggage allowance I want/ need - take the stress and hassle and I’ll be happy.

Ai: So how is it shaping up?

This is probably already happening in premium cabins, but the traveller expects the same when he is down at the back. This suggests - custom benefits, custom propositions and custom interpretation of the rules are going to be important and true drivers of loyalty.

Ai: Can you share your loyalty/ reward program disappointments? What’s your biggest pain-point till date?

There are two areas of disappointment:

  • The first one is when the programmes does not deliver on its promise, that’s usually around a benefit delivery/ failure. And it is usually in mileage redemption.
  • When things go wrong the airline / programme not helping you with your problems and staff not appearing to be empowered.

Ai: What would you count on as the biggest development as well as the challenge in loyalty today?

The first one would be the shift from miles to revenue / quasi-revenue based – and it’s going to shake the whole industry and potentially cast a lot of “Y” travellers down to the purely price based world.

Also, it need to be noticed that ancillary benefits / sales are overlapping with loyalty benefits and the airline trying to sell you something you previously ‘earned’ for free, potentially negates long term loyalty in favour of short term benefit / service bidding. he net result of this is that the “Economy” space ends up looking like a low cost carrier.

Ai: How is data helping in understanding the motivations travellers may have to enrol in a loyalty program?

At the moment not many people are doing this well - usually using data for offer targeting and little predictive or real time use of data. Where this needs to go is to move to custom pricing where you will get flight and benefit package pricing based on an intimate understanding of your behaviour, needs and capacity to buy. This sort of custom proposition could be the new loyalty. No one is really there yet.

In addition to pricing, custom benefit serving and delivery would be something that they can do for the member to keep them happy.

Where the smart data and ancillary sales do come together is where the FFP becomes a big affiliate platform making targeted sales offers (and a margin) from a myriad of different journey vendors (cars, parking, stores, duty free etc.) eager to sell the traveller something. In this context, trust, respect for privacy and preference are critical. If the FFP is going to offer you less but sell to you more, you had better have a pretty strong relationship to stop people heading for the door.    

Ai: What role do you think data analytics is playing in the arena of loyalty – for instance in improving upon merchandising redemption and the overall experience of flyers?

Most programs are talking the talk on analytics but not delivering. On the non-air redemption side the big question is can the advanced analytics become like Amazon for targeting content and offers.

Ai: What should be the major priority of airlines today especially when airlines are not only expected to recognise a loyal flyer, but achieve top-notch personalization? So it would be offering what a loyal customer is looking for during his or her journey.

  • Recognize and rewards revenue value
  • Demonstrate to members that you genuinely care about them (not easy for the ops driven airline culture)
  • Offer greater customization of benefits and rewards

Ai: What do you make of mistakes that airlines can commit when it comes to redeeming miles for merchandise? For instance, critics often talk about relatively lower cents per mile for non-travel products offered?

It’s not lower really, it’s just that flights were always priced too cheaply, so that the insiders who could play the system got all the seats, but everyone else got a raw deal. The internally charged cost of flights needs to rise to reflect a more commercial value. This may feel like a bad deal for members and it might even spell the end of some weak FFPs. The smart ones will find more ways to put more miles in peoples accounts and increase the overall value of the member. With higher value members delivering more revenue, the FFP can find a way to subsidize that seat. Eventually it goes the way of Amex.

Deborah Merrens, head of marketing, Global Blue, spoke at the FFP Loyalty Conference, a part of the 2nd Annual Mega Event Asia-Pacific in Singpoare on the 1st and 2nd of September. Similar issues will be covered at the global Mega Event in San Diego this 4th and 5th of November.

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Executive Interview: Nik Laming, Cebu Pacific Air

Our chat with Nik Laming, General Manager – Loyalty Division at Philippines’ leading carrier Cebu Pacific Air, who spoke at the FFP Loyalty Conference, a part of 2nd Annual Mega Event Asia-Pacific (held in Singapore, 31st Aug 2015 – 2nd September 2015).

From a Traveller's Lens

From A Traveller’s Lens

Airlines today are not only expected to recognize a loyal flyer, but achieve top-notch personalization, too.

If one has to deliver a consistent and yet tailored experience to members then it is imperative to clearly define processes and execute flawlessly, asserts Laming. Laming says there are many moving parts in the airline business and the loyalty program is a tool that helps to identify customers and customise offerings to their needs but only if the organisation can operationalize the good intentions.

For its part, Cebu Pacific launched its GetGo lifestyle rewards program for frequent fliers (over 1.4m) in March this year. It allows members to accumulate points on everyday spending (on groceries, utilities, gasoline, etc.) and redeem those points for a free flight. Laming spoke in detail about what needs to be done to ensure a loyal passenger gets his or her due in an interview with Ai Correspondent Ritesh Gupta.

Ai: If you were to assess loyalty as an air passenger, what makes you happy?  

As a loyalty member I am happy when the core benefits are done well – don’t give me non-air rewards and frilly extra’s to paper over the cracks of a fundamentally flawed program.  Make sure I can get redemption flights when I want them albeit at variable rates.  Tier qualification is poorly done sometimes – for example only business or first contributing to top status is too restrictive and just isn’t viable in this day and age.

Ai: What would you count on as the biggest development as well as the challenge in loyalty marketing today?

(It would be) The member revolution powered by smartphones and social media. People are more connected, more vocal and more demanding than ever before.  A small issue coupled with a canny member can result in wide spread social media unrest if not managed carefully.  And the speed of change and reduction in reaction times required to manage this new world are a big challenge.

Ai: The onus is on marketers to serve the customers in the best possible manner by being data-driven. What does it means to you, and how actually do you think one can excel in an omni-channel environment?

Getting the basics right is vital.  There is effectively an agreement between the program and a member whereby data is exchanged for rewards.  Using the data with respect and to improve customer experience is the key.  We currently operate across multiple channels including web, mobile, call center, Facebook, Twitter and Instagram – monitoring all the channels and having the tools in place to enable a single view of customer communication and respond is critical.

Identifying customers across proliferating social platforms, devices and channels is difficult and becoming more difficult every year. Having the right technology in place to knit together the different streams of data is a good start but there are often gaps. These gaps mean that customers do get frustrated as they are not addressed as one individual. It is an area of focus for every organization to solve in the near future.

Ai: Can you cite examples where you feel you have excelled in offering what customers expect from loyalty?

GetGo is a very new program so the best is yet to come.  However we have built in some best-in-class features to deliver above and beyond expectations from launch.  These include any seat redemption, points pooling, dynamic top up and an expanding range of earning opportunities.

Ai: Where do you think airline loyalty programs generally are going wrong – from both technology and operations perspective?  

There are inherent issues with airline loyalty programs with broken commercial models, complex technology and omnichannel customer service.  Most programs from legacy carriers suffer from a lack of award seat availability due to the underlying business model and conflict with revenue management. 

At Cebu Pacific, we did not originally anticipate the need to view Instagram as an inbound customer service channel.  But we had to adapt our process to accommodate it after we received a complaint as a comment under a photo we had posted. 

Ai: What role data analytics is playing in the arena of loyalty – for instance in improving upon merchandising redemption and the overall experience of flyers?

Data analytics underpins the ability to deliver a tailored experience and appropriate offers in the most efficient way.  Applied correctly the insights derived from analytics are the most powerful aspect of loyalty marketing.  Simple profiling and targeting remain very effective.

The ability to deliver real time and highly targeting messages has finally enabled marketers to answer the conundrum of right customer, right place, right time with the right offer. Predictive modeling adds another dimension to aid targeting and improve marketing efficiency. Differentiated service and offers are only made possible with data analysis. So the role of data analytics is simply huge.

Ai: What would you term as major priority today especially when airlines are not only expected to recognize a loyal flyer, but also achieve top-notch personalization?  

Process and operationalization do not tend to be viewed as a major priority for marketers.  However if you are going to deliver a consistent and yet tailored experience to members you have to be able to both clearly define processes and execute flawlessly. 

Delivering benefits such as priority boarding or baggage handling requires consistent process across wide networks. As campaigns become more complex and multi-dimensional the need to manage them efficiently relies on process. Points programs are essentially mini banks but managed by marketers. Without well defined processes to award and redeem points and secure data programs are frustrating for members best case and worse they are open to fraud and abuse.

Ai: What’s on your agenda for Cebu Pacific Air in the next year or so?

A major focus on the basics. Make the program attractive and efficient to attract members and keep the current ones engaged and excited.  We are adding new partners and ensuring we serve current ones well.  We have a roadmap of exciting developments in the coming 12 months but these need to be built on a solid foundation.

(The airline has a 55-strong fleet, and it carried 16.9m  passengers in 2014, 17.5% more than flown in 2013. Ancillary revenue grew 29% to P8.7 billion last year. It posted a core net income of P 3.3 billion, up 77% compared to the previous year, on the back of notable improvement in both revenues and operating expenses).

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Executive Interview: Mark Mullinix, Loyalty Advantage

Our chat with Mark Mullinix, MD, Loyalty Advantage and conference chair of the FFP Loyalty Conference, a part of 2nd Annual Mega Event Asia-Pacific (held in Singapore, 31st Aug 2015 – 2nd September 2015.)

From A Traveller’s Lens

Airline loyalty programs are evolving. There is plenty at stake, and carrier can’t afford to slip. For instance, revenue-based earning approach has a huge number of complexities in implementation for legacy carriers. Also, airlines still struggle with consistency in service delivery and with recovery from irregular operations, says Mullinix.

Mullinix believes airlines need to ensure the overall travel experience is sublime, and a traveller should feel “I have received something that I value in exchange for my loyalty”.  Excerpts from an interview with Ai’s Ritesh Gupta:

Ai: If you were to assess loyalty as an air passenger, what makes you happy?  

There are really two different ways to assess loyalty here—one is the loyalty to the travel experience provided by the airline, and the other is the loyalty to the rewards received. Airlines are trying to use their loyalty programs as differentiators, but if the basic service promise of the airline isn’t being met, the majority of travellers will have no true loyalty to the airline—only loyalty to the rewards.

For me, the most important factor in loyalty to an airline’s travel experience is that it delivers what it promises. I fly low-cost carriers and full service carriers, and in each case I come away happy, as long as I received what I paid for. It’s when the airlines don’t manage to deliver what they promise that a traveller’s loyalty to an airline gets questioned, and my decision to remain a customer of the airline may be more due to the loyalty rewards rather than due to my intrinsic happiness with the airline. In Net Promoter Score terms, I become a detractor while remaining active and flying regularly.

On the rewards front, what makes me happiest is the perception of value—feeling that I’ve received something that I value in exchange for my loyalty. This value driver will be different for each passenger, which is the challenge for loyalty program managers trying to build a one-size-fits-all program.

Airlines still struggle with consistency in service delivery and with recovery from irregular operations. It’s not easy, but these are definitely the areas that can make the most difference in a customer’s experience.

Ai: What would you count on as the biggest development as well as the challenge in loyalty today?

The biggest trend we’ve seen in the past few years, and certainly the most hotly debated, has been the shift towards explicitly revenue-based programs where the number of points earned is a direct function of the number of dollars spent.

After Delta announced their shift, United followed quickly, and the industry consensus seems to be that American will do the same as soon as they finish the final merger details.

While it’s made big news, using revenue as a basis for mileage earning is hardly new. Airlines around the world have been differentiating mileage earning by fare class (as a proxy for yield) for a long time, but few had removed the “miles flown” entirely from the earning equation as Delta and United have.

This revenue-based earning approach has a huge number of complexities in implementation for legacy carriers: foreign currency effects, interline/ alliance codeshare tickets, and the multipliers for elite tier status are just three that have already become clear. More importantly, the publicity around these program changes has sparked a debate among frequent flyers as to whether loyalty is even worthwhile any more.

I would challenge airlines to think carefully about what they are trying to achieve with their loyalty programs, and to redevelop not based on the latest me-too trend, but in a way that will drive towards those objectives. I think there is an opportunity for smart airlines to capitalize on the growing disillusionment from consumers with a “back to basics” program while still preserving the balance sheet.

Ai: Can you cite examples where you feel airlines have excelled in offering what you expect from loyalty?

This is a very personal question as each customer will expect something different for their loyalty. I think Cathay Pacific have done an excellent job of providing that “little extra” for their loyal customers, through on-board recognition, a yield management strategy that allows for relatively generous operational upgrades, and decent availability of awards in a traditional miles-based program.

In the major alliances, oneworld has excelled in creating loyalty to the alliance in general through unified policies. One of my favorites is that on a codeshare flight, the earning rules of the marketing carrier apply, rather than the operating carrier. This makes it much easier for the consumer to know what they will earn, as compared to Star Alliance where the fare class of the operating carrier dictates the mileage earned.

On the other end of the spectrum, Southwest have done an excellent job of communicating a simple value proposition and fulfilling that promise. Each booking shows the number of points that can be earned, or the number of points required to redeem, as an integral part of the booking process, ensuring that the loyalty program is top of mind even though the actual points value may not be transparent to the average consumer.

Ai: Where do you think airline loyalty programs generally are going wrong – from both technology and operations perspective?  

I don’t see programs as going wrong from a technology or operations perspective. Generally, the loyalty program management technologies are among the most up-to-date systems the airline employs, given the long history of mainframe-based technology and legacy systems in other areas of operations!

Where the programs are suffering is in their overall strategy.

The reliance on external partners and the creation of a miles ecosystem where the majority of miles are no longer earned through flight behaviour have pushed the airlines into a difficult strategic position—consumers still want to redeem miles for flights, but there are no seats and far too many miles.

The revenue from partners has become so massive that the airline’s loyalty program becomes more a facilitator of partner transactions than a true driver of loyalty to the airline.

Ai: What should be the major priority of airlines today especially when airlines are not only expected to recognise a loyal flyer, but achieve top-notch personalization?  

So much of loyalty is really about customer experience. I think this is a huge opportunity area for airlines.

Hotels have learned these lessons very well and now when you check in, many of them have a completely personalised experience available to you. I believe the opportunity is there for the airlines to do similar—moving beyond “window or aisle” to “he prefers window on long-haul but aisle on short-haul, and we know he usually takes a soda with no ice, so let’s confirm that when doing beverage service rather than asking him as if we’d never seen him before.”

This relies on both technology and staff, with staff being the more difficult part of the equation. And of course the most important question still remains — would this level of service really drive increased loyalty and profitability?

Ai: What do you make of mistakes that airlines can commit when it comes to redeeming miles for merchandise? For instance, critics often talk about relatively lower cents per mile for non-travel products offered?

What critics are missing in their analysis of low-value rewards is that there’s a market for those rewards. Consumers aren’t always motivated by the highest cash value equivalent for a reward—if they were, everybody would be saving for first class long-haul travel.

Convenience, the feeling of instant gratification, burning points prior to their expiration, or the ability to “monetise” points into a gift card are all valued by the consumer in their overall decision, and in many cases these very rational criteria lead to seemingly irrational decisions regarding redemption of points.


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Are retail co-brands relevant?

April 11, 2015

Point of View Editorial

Marc Berman

Executive Chairman Co-Brand Conference

CEO and Managing Partner, The Mallett Group


Are retail co-brands relevant?

Over the past 10 years we have seen a shifting environment for cards that have been brought to market.  The omnipresent travel cobrands in air and hospitality continue to create an aspirational goal for those frequent travelers and frequent buyers.  These cards are the largest partner of any travel company;  the purchase of their loyalty currency by issuers can run into the billions of dollars per year.

Additionally many bank issuer cards have an attached loyalty scheme that supports customers’ travel desires through earn and conversion to either their desired FFP or direct redemption for tickets, and of course merchandise.  We have seen the big issuers expanding their reach into the consumer base with large bonus promotions to drive spend and share of wallet.  Soon we will see the launch of a “coalition” program here in the US.  Coalition programs have never succeeded here as they have in Canada, the UK, and other geographies.  We will watch with interest.

Also, in the past few years we have seen a sizable decrease in pure affinity cards.  These portfolios have grown smaller, and sponsoring institutions have struggled to retain their base.   Not to be forgotten is the formidable size of the customer base that enjoys pure cash rebates of 1-2% for spend.  The cash-back segment is huge and tailored to the needs of this population.


So where does this leave retail co-brands?  In this highly competitive environment, affected by all of the above, retailers position themselves directly to their customer base to drive spend to their stores by offering promotions, discounts and other benefits that a truly loyal shopper appreciates.  However, keeping these programs and the portfolios healthy, relevant and compelling is an increasing challenge.  One needs to think outside the box to target, engage and reward so that retailers enjoy the same ROI as other types of cards in market.


At the stand-alone Co-brand Event hosted by AI Connect on May 27/28 in Chicago, retailers will learn about emerging engagement strategies from cutting edge companies, will be exposed to the competition and will hear directly from issuers, networks and industry consultants on new ways to harness “Interaction to Transaction”, the theme of the conference.  Come join us!

Ai Editorial: Travel Experience - who will help you?

Who will a traveller go to seek help - are you sure it’s going to be a human? Connected app experiences, wearables, facial recognition all of this is going to lend a new dimension to a traveller’s entire trip? Ritesh Gupta, Airline Information Correspondent finds out

If ever direct communication were to stand the test of time, be it for travel planning, booking or the sheer joy of taking a journey, then that moment is about to happen in the near future.

The question is who will a traveller go to seek help?

As it turned out during our annual Mega Event 2014 held in New Orleans in late 2014, a survey indicated that around 1/5th of travellers in the U. S. expect to talk to a robot (that will be more helpful than a person) in 2020. As indicated by Switchfly, 1/3rd believe that no one will call hotels or airlines directly by then, and that all communications will be done electronically.

So are travel shoppers going to avoid human interactions altogether or is just that the connection between services, devices and location is going to mark a new chapter in the commerce and customer service arena?  Let’s explore some of the new developments that may take us to the point where we don’t end up interacting with anyone for our travel-related requirements.

So what’s happening as of today that indicates travellers can do a number of things independently.

Let’s start with smartphones. Say you own one, and there are apps in it. As a traveller, you tend to go through different apps for probably one journey of yours. But this world of friction in the disconnected app world is slowly disappearing. And this is being made possible deep linking technology. It essentially means that one’s intent is going to be figured “intelligently”, and he or she is going to be driven to the desired service. Today technology has reached a point where a consumer is being enticed to reach a specific page inside the app, no matter whether the app is already installed or not (you may read about Branch Metrics).  One of the emerging players in this arena, NYC-based start-up Button analyzes a consumer’s intent on activity, historical data, context, time, and location.  So it could be that you are using an airline app, checking in for your next flight and you end up seamlessly booking a reservation for a restaurant for your next destination.

This also means that our preferences and behavior is up for grabs, and we are sharing relevant data. But let’s not just restrict it to mobile apps. For instance, beacons can pave way for personalized communications and calls to action. If one acts on such technology, there is a footprint to be followed. There already has been a lot of buzz around our place getting sensorized, with almost everything out there gaining an IP address. This would result in exchange of data and the Internet of Things (IoT) will become a reality.   

I came across an interesting observation highlighted by consultant Jeff Rubingh, who underlines that there could be an “API of You, of all of your own data”.  

There could be a possibility of you, as a consumer, making data available as an API. Who is going to facilitate this is yet to clear up, but Rubingh has a point when he says your data is reflection of your being, your identity. How much you share is going to be under your control, and of course, this is going to be driven by upcoming devices, and we all already aware of wearables.

Cognitive computing and the IoT

Overall, a lot is being expected from the blend of cognitive computing and the IoT phenomenon.

As a specialist in this arena, Saffron Technology says the future is about spotting connections among data across varied sources, doing away with modeling, while learning incrementally and working on results based on patterns identified in the data. It does get complicated for one who doesn’t know much about these concepts. But to put in Saffron’s words – the entity formulates a “real-time adaptive model of “your” world as we continuously learn about every “thing” in your data and its connections in context with every other thing”. Clearly the term “big data” wouldn’t sound as big as it did over the past few years!

For consumers, this will have direct impact on the level of personalization as well as fraud detection.

Moving on, one last topic that is surely going to garner attention this year is the world of payments. Whether Apple Pay gains traction or not would decide the fate of NFC payments. On the positive side, the industry is already expecting smartphones to play their part in boarding via contactless smart cards.  All of this means that touchpoints where human beings generally used to serve travellers wouldn’t be needed if all of this goes mass.

The world is getting definitely getting smarter, and it all boils down to offering travellers new ways to do less of what they used to do earlier. And at the same time, the entire trip would be much smoother than ever before. Whether human interaction would really count or not, it hardly would make any difference as long as customer service is catapulted to a newer level.

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Ai Editorial: Combining FFPs & Financial Services Programs for New Earn Opportunities

***STOP PRESS*** ►Registration is open for Mega Event 2015 & 10th FFP Loyatly Conference in San Diego in November.

How are non-traditional partnerships growing the stickiness of a loyalty program? Ritesh Gupta, Airline Information Correspondent assesses the same

The way airlines manage a loyalty program isn’t just about rewarding one with apt loyalty currency or juggling between cash back and travel rewards.  Rather one also needs to take into account what can result in affordability of loyalty partnerships.

Airlines have to assess how loyalty linked to aspirational rewards works, and how they need to look at multi-partner loyalty today.

As highlighted during our annual Mega Event 2014 held in New Orleans in late 2014, frequent flyer and financial services programs are beginning to direct their focus to new earn opportunities not common to their program types but table-stakes in coalition programs. It’s being described as a B2B strategy that focuses on the loyalty program aiding merchant partners to use the power of their program and currency to significantly shift shopping behaviour in consumers.

Reality of coalition

The term coalition, as Tim Moulton, VP, business solutions and business development, Points says, often described as a group of customers that share a bucket of customers to cross-pollinate each other’s customer bases “is not always attractive in emerging FFP and FS (financial services) loyalty programs”.

“These types of brands are generally not willing to share access to their customers,” points out Moulton.

“So, the attractive model is one where each party promotes within their base the program offer setting strict guidelines regarding the sharing of member information and reporting,” he says.

According to him, the value proposition presented to merchant retailers from FFP and in some cases FS is the flight reward option, which is usually a stronger value than third party options. FS, value proposition to the merchant is also travel rewards and experienced base rewards fuelled by the ability to double dip accelerating their ability to get to a reward quicker. FS partnerships also provide an easier relationship to the merchant; no additional step, earn construct understood by the collector and usually no IT or MIS requirements by the Merchant.

“When the FFP and FS work together the real power comes out in reporting that shows relevancy to the merchant and partnership return. In this scenario the FSs’ card products become more relevant and effective to the collector, the FFP enables the members to achieve rewards faster and diversify their accrual revenue and merchants have fewer steps to collect and marketing channels with brands that are respected. For FS and FFP programs that do not want merchants collecting membership information this solves for that,” explains Moulton.

Responding to members’ desire

Airlines need to assess what is fuelling merchant adoption.

The benefits to members include new ways to acquire the points and miles they need to reach their aspirational travel goals faster. The industry is witnessing a lot more exclusive member benefits that truly drive engagement with the loyalty program.

So how are FFPs and financial services programs are combining today to new earn opportunities?

“The main opportunity is the FS opening up more to the FFP. In the past co-brands were reluctant to share spending data from the cards to merchants or even the FFP. There are many examples in the market now (TD/ Aeroplan) where this sharing of spend data has begun, and communicated to the member,” says Moulton. “The data can be used to optimize FS and FFP but also used to show value to merchants. The data begins as a BD tool for the cobrand and FFP to understand the best merchants to pursue and extends into proofing value to the merchant when moving through the qualification and discovery phases of the BD process.” For the FFP and FS this data helps promote utility of the program to the members but for the merchant it helps demonstrate members in their trade area that are not shopping, and designing campaigns to encourage stronger baskets and more frequent trips. Essentially capturing more household spend for all stakeholders, adds Moulton.

Citing examples of exclusive member benefits that some airlines are offering today, Moulton shared:

  • The ability to control your path to a reward through buy, gift or transfer platforms
  • Other earn opportunities with non traditional everyday earn categories (Gas, grocery, pharma, home improvement)
  • Offers in new third party channels such as:
  • Digital wallets
  • Earn and burn of gift cards into FFP currencies
  • Extending redemption options into brick and mortar for real time burn and other constructs
  • Lifestyle partnerships (golf, activity linked special offers such a bike clubs)


So what can one expect in 2015 as FFPs and financial services programs continue to jointly evolve?  

Moulton says one can expect accelerated earn partnerships with merchants. This is currently an under-developed opportunity and program are beginning to develop these teams and partner with third parties to drive the BD process. Also, there would be digital wallet soft launches where FS and FFP’s currencies can be managed and used for some transactions. There is a race in the merging payments sector and the digital wallet provides: the ability to transact with hard currency and the consolidation of content (i.e. loyalty) with the ability to transact with those programs. A consolidator like allows digital wallets to add that benefit efficiently.

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Executive Interview: Duane Tough, Payabillity

Our chat with Duane Tough, President Payability & keynote speaker at the Co-Brand Partnerships Conference held in Chicago on 26 & 27 May 2015.

From A Traveller’s Lens

Aggregation of points/rewards” is the most over-rated concept in the travel sector, believes Duane Tough, President – Payabillity

Nothing like experiencing a product yourself that you are responsible for and then improvising upon the same to enhance its utility.

As an inventor of patents pending in payment acceptance, loyalty, localization and currency management systems, Toronto, Canada-based Duane Tough, President – Payabillity believes there are lots of areas where the overall journey of a traveller can be improved. As for payments, Tough tries to use as many options as possible to come to grips with emerging trends.

Let’s hear out what Tough has to say about the world of payments, loyalty, and his journey as a traveller. Excerpts from interview with Airline Information: 

AI: When you reflect upon your career in the world of payments, what would you term as the defining moment?

I can’t say ‘one’ moment was defining – I think that the whole payments lifecycle of ‘never being boring’ and always being able to learn more is the motivator for me. I try and use as many as payment methods as possible. It really depends on the jurisdiction – cash, open network cards, closed network cards… I was in Las Vegas recently and purposely spent the whole day paying for everything with casino chips!

In Canada they have several wireless and NFC networks that compete for a relatively small market- Interac (a national debit network) Visa, MC, and all pale to what Starbucks does on its network in Canada - adding more seems overkill to the consumer in markets like Canada.

AI: As a traveller, what excites you most about completing a transaction in air travel today?

Many air travel payment items excite me, the progress of onboard payments, the pre-pay and ‘layaway’ plans for ticket purchasing, corporate travel management, flight expense reporting along with personal and corporate reward reconciliations into reporting.

AI: What would you like to see improving as far as operations of the airlines in general is concerned?

Airlines are very good at communicating what ‘they do’ to the traveller, if they enhanced the offerings of communication to ‘time to pass through security’, ‘real time taxi waits’ and more along the lines of what the ‘person’ does in the whole lifecycle of their travel- not just what the person does with the airline – it would be better.

AI: Technology and devices have a lot to offer to travellers, and accordingly delight them. How easy or challenging is it for even a tech-savvy traveller to embrace new forms of payments?

I think the tech involved with airlines is greatly assisted by the “fintech” industry as a whole educating the consumers that in turn understand more of what the airlines offer in technology and payments.

AI: How should airlines gear up for payments strategy today in an omni-channel payment environment?  

Anything you can buy online, over the phone or at the counter you should be able to do anywhere with any device with multiple payment methods, I should not be told at the boarding gate that they can’t take my cash to upgrade or that points (as a currency now) need to be done online – I have been rejected many times in different ways with almost every airline.

AI: Can you cite examples of some of your inspiration/ experiences as a traveller and how you incorporated the same in your work?

Staff - I have seen the staff of many airlines go above and beyond in making the experience much more enjoyable. As a mostly business traveller I dread a lot of flights- when I hear the humour or the attention of that one staff member before during or after a flight I forget about the dread and enjoy more of the experience.

AI: What according to you is the over-rated concept/ theme in the travel sector?

Aggregation of points/ rewards – no one understands code share points and redemption transfers and expiries- all those offers are just confusing to most people and end up being a ‘whatever’ moment that does not contribute to the decision of where, when and who to travel with.

AI: What according to you is the next big thing in payments as well as air travel?

These would be:

  • Open source flight integrations for past, present and future flights (wish lists, reminders, reward levels to next free flight) on a technology basis so that many sites can contribute to the overall airline experience. Imagine logging into your bank account, your cell phone or cable account and getting all the travel management data and tools so that you know if you use your rewards credit cards for xxx more dollars you can take your kids to Disneyland with a free flight or hotel etc.
  • In-flight and terminal real time translation – its close with some smart phone apps, but with NFC- how about when I approach a sign my phone has it in English (or whatever native language) for me – I can ‘tune’ my phone/ tablet etc to hear the in-flight messages in any language or in txt for the hearing impaired or even brail.
  • Anywhere billing- bill my flight to any account – cash, debit, credit, cable, phone bill and more.



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Co-brand cards: which are most rewarding?

In American Airlines' latest financial update the carrier disclosed that 66% of its total frequent Flier miles were sold to partners, such as the bank issuing its co-branded credit card. That's a whopping 125 billion miles! This demonstrates the power of co-brand and the importance airlines' place on this revenue source. However, at least in North America (because the trend hasn’t totally caught on everywhere), the banks have responded to the lure of travel as an incentive; the banks have established their own travel reward cards.

So, which cards are most rewarding?  Are consumers better off with an airline co-brand card or a bank travel reward offer?  My recent research “Card Carrying Generosity” came up with some intriguing surprises. I’ll be sharing the results of this research as part of my talk at the FFP Spring Event in Washington DC in April. Quantifying value in the loyalty business is never an easy task, but the report indicates banks have gained an advantage. The lesson I will offer during my presentation is this - - airlines be aware, because your competition is wide awake.

I’m also delighted to be able to share that Airline Information has made the Kids First Fund their supported charity for 2013.  The fund works to help abused children in resource-poor areas of the world. Kids First Fund is supported by generous donations from airlines, hotel and car rental companies which provide prizes for our charity auction. If you’d like to know more about the charity, or to make a donation for the charity auction, please click:

In the meantime, if you want to know more about the "Card Carrying Generosity" report you can visit:  Click on the recent report link.  I’ll also be at the FFP Spring and the Freddies Award Ceremony if you want to come and know more about this research or the charity.

Guest Editorial by:
Jay Sorensen
, President, IdeaWorksCompany

Guest Editorial: Dual Co-Brands, Driving Loyalty Revenues

Guest editorial from The Mallett Group

Is your loyalty program leaving revenue on the table? Over the past few years Dual (Jewel/UK lingo) card offerings have begun to be reluctantly embraced by the merchant networks to address acceptance issues. For those of us who have not encountered dual card offerings, they are co-branded credit card products that offer not one, but two network branded cards tied to a single consumer account. Meaning there may be a Diners Club card paired with a MasterCard that is placed into market within a merchant's co-brand card offering.

Because the dual network offering allows the issuer to garner all spend due to acceptance restrictions in certain markets. For example, American Express has more limited merchant acceptance in the UK market, so a companion Visa is offered to capture spend that otherwise would be relegated to other card products in wallet. Meaning it is better to have partial share than no share at all. Counter intuitive upon first blush, but potentially sound as one never wants to be late to the party.

We have seen these offerings in the UK – with the likes of Virgin Atlantic, as well as with airlines in Spain and India. And, watch this space as there are more to come!


  • Ego: When was the last time die hard competitors played together and were happy?
  • Commercial:  Complex negotiations to produce a consumer value proposition (CVP) that is acceptable to both networks
  • ROI: Projections of spend that relate to back-end compensation to the network, issuer and ultimately the brand sponsor
  • Marketing: Messaging correctly to acquire and retain.  Customer confusion can be a concern
  • Earn:  Internal network requirements place restrictions on enhanced and devalued mileage/point earn ratios
  • Benefits:  What card benefits get attached to what network offering
  • Negotiations:  How to please some of the people some of the time
  • Contracts:  How agreements are structured and how the money flows including VAT in some markets

The Dual Card offering can be a powerful measure to employ in a less than ideal market situation. However, one needs to navigate the obstacles in a sophisticated manner.  It takes more than the average plug and play solution, but in the end it can provide a robust product to consumers and reward the brand with enhanced commercials.

To learn more about loyalty co-brands and dual cards in particular, please contact Marc Berman, President, The Mallett Group by emailing him at Marc will also be chairing the Co-Brand 2015 Conference in Chicago on 27 & 28 May 2015 and the Travel Co-Brand Partnerships Conference at Mega Event in San Diego on 4 & 5 November 2015 in San Diego

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