"Don't be afraid to have a bigger relationship with your customer, beyond your product"

CRM in Travel USA 2008 SpecialIn the recent years, frequent flyer programmes seem to have drifted from their original purpose of promoting loyalty.

Published: 05 Feb 2008

CRM in Travel USA 2008 Special
In the recent years, frequent flyer programmes seem to have drifted from their original purpose of promoting loyalty.

From a hoteliers' perspective, Ken Bott, Director of Global Consumer Marketing, InterContinental Hotels Group, too, acknowledges that that there is a trend in the marketplace that the perceived value of an airline mile is diminishing, thereby causing consumers to consider other reward programmes.

"So many more consumers arrive by car (than by airplane) at their destination such that it makes sense hotel programmes would be the next focal point for frequent travelers," Bott told EyeforTravel.com's Ritesh Gupta.

It is being felt that airline programmes are a victim of their own success; they became so adapt at selling miles through their credit card and retail partners that they flooded the marketplace with currency. On learnings for hoteliers even as hotel programmes are said to be becoming the equal of frequent-flyer programmes in the marketplace, he said across the marketplace reward currencies are gaining more utility.

"The breadth of customers that could potentially stay with us, over 570,000 in nearly 100 countries in just one night, forces us to design programme attributes that are flexible and appeal to customers all over the world. That multi-cultural aspect, coupled with the seven strong brands we represent (InterContinental, Crowne Plaza, Hotel Indigo, Holiday Inn, Holiday Inn Express, Staybridge Suites and Candlewood Suites) enables to offer more diversity than any of our competitors," said Bott, one of the speakers during EyeforTravel's CRM in Travel USA 2008 conference in New Orleans.

According to Bott, seven key loyalty trends are shaping the landscape:

· There has been a proliferation of loyalty programmes across multiple industries and all compete for customer mindshare;

· The value of an airline mile has been dropping and consumers are considering other reward programmes;

· The overall utility of reward currencies is expanding;

· Coalitions are gaining ground and successful ones drive very high penetration;

· Companies are redefining their "best customer" strategies to develop relationships emphasising differential treatment for their high value customers;

· Companies are investing heavily in customer analytics to maximise the value from their customer data;

· Companies are considering loyalty programme spin-offs as a means to create shareholder value.

As marketers refer to different customer groups warranting a different level of investment via marketing communication programmes, via offers and incentives, Bott said clear objectives, tracking metrics (to get your ROI) and a tremendously smart staff of marketers are critical in managing a loyalty programme when different segments of customers deliver value at different rates over the short and long term.

On how loyalty marketers are leveraging the Internet's ability to build virtual communities to create niche networks of customers who interact with each other through a platform facilitated by the brand, Bott said loyalty marketers are inherently successful at utilising the social media/marketing environment because they've been doing it in the real world for years.

"Successfully extending your brand presence into virtual communities depends entirely on how good your relationship skills are as a company. Using the internet as an awareness/acquisition tool will continue to be a focus for everyone in the future, so we're making sure we're where our customers are. So you'll find our brands (Holiday Inn/ Holiday Inn Express, Crowne Plaza) represented in a genuine fashion on YouTube, Second Life, and Facebook," said Bott.

Regarding approach towards loyalty programmes, Bott recommended and said, Beware of "fake loyalty"; Follow your customer's overall mindset trends, not just his/her trends with your product; Don't be afraid to have a bigger relationship with your customer, beyond your product.

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