Table of Contents
Executive Summary
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- Figure 1: Total enrollment and share of enrollment in travel loyalty programs, by industry, October 2015-November 2016
- The issues
- Despite interest in experiences, members want cash-back bonuses and gift cards
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- Figure 2: Interest in reward redemption options, March 2017
- Young, avid travelers are least likely to be loyalty program members
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- Figure 3: Enrollment in travel loyalty programs, by age, October 2015-November 2016
- Relatively few members feel their loyalty pays off
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- Figure 4: Engagement with loyalty programs – Select items, by type of past year travel, March 2017
- Membership doesn’t mean “loyalty”
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- Figure 5: Single company membership, by industry, October 2015-November 2016; attitudes and engagement toward travel programs, March 2017
- The opportunities
- Under 45s may be willing to pay for better programs and perks
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- Figure 6: Reasons for joining a loyalty program – Select items, by age, March 2017
- Data can help personalize rewards for members
- Free or discounted hotel stays or airfare can help lure back lapsed members
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- Figure 7: Desired rewards, by hotels and airlines, March 2017
- What it means
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The Market – What You Need to Know
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- One in three adults aged 18+ belongs to a travel loyalty program
- Memberships in all travel loyalty program segments grew from 2015-16
- Travel credit cards and OTAs attempt to win over traveler loyalty
- Travel spending growth points to importance of program engagement
Frequent Travel Program Enrollment
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- Three in 10 adults are enrolled in a travel loyalty program
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- Figure 8: Total enrollment and share of enrollment in travel loyalty programs, by industry, October 2015-November 2016
- Adults aged 18-24 least likely to be enrolled in a travel loyalty program
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- Figure 9: Enrollment in travel loyalty programs, by age, October 2015-November 2016
Market Breakdown
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- All travel loyalty program segments grew YOY from 2015-16
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- Figure 10: Share of enrollment in travel loyalty programs, by segment, 2011-16
- All frequent flyer programs gained members
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- Figure 11: Frequent flyer program memberships, by major US airline, 2011-16
- Membership in hotel loyalty programs grows among largest brands
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- Figure 12: Hotel loyalty/rewards program memberships, by major US hotels, 2015-16
- Growth of car rental programs in question as ridesharing interest grows
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- Figure 13: US vehicle rental privilege program/club memberships, by brand, 2011-16
Market Perspective
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- Credit cards compete to provide the ultimate “black” card
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- Figure 14: Chase Sapphire Preferred credit card: Earn 50,000 Bonus Points, May 2017
- Figure 15: American Express Platinum Card: You’re Invited to Apply for the Platinum Card, May 2017
- Despite direct booking push, lowest prices may be beyond brand’s sites
- Travel is a top goal for half of families in the near future
- Retailers and lifestyle brands enter the hotel scene
Market Factors
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- Vacations and tourism spending outpaces overall consumer spending
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- Figure 16: Total US consumer spending and vacations and tourism spending growth, 2011-21 (fore)
- Millennials fuel growth...but Boomers shouldn’t be overlooked
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- Figure 17: Population, by generation share, 2017
- Shifting loyalty landscape rewards travelers by spend rather than frequency
Key Players – What You Need to Know
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- Ease of redemption earn programs high overall satisfaction ratings
- Program changes and options outside of the program may impact loyalty
- Simplicity and personalization may be key to program growth
What’s Working for Loyalty Programs?
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- Hotel brands offer more ways to earn and use points
- Tech innovations help travel brands stand apart
- Hilton, Marriott, Alaska Airlines earn highest overall satisfaction
- Hotel loyalty/rewards programs
- Airline loyalty/rewards programs
What’s Challenging Loyalty Programs?
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- Changes in loyalty programs can unsettle consumers
- “Shop around” culture is pervasive, program members look elsewhere
What’s Next for Loyalty Programs?
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- Cross-industry integration can boost program membership and loyalty
- Travelers desire simplicity and efficiency for their travels
- Data can provide insights for more personalized offerings
- Credit cards may set standard for programs to weed out churners
The Consumer – What You Need to Know
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- Annual fees prevent some from joining loyalty programs
- Free hotel nights and free flights are most in-demand rewards
- Monetary rewards are most likely to be redeemed
- Young adults and men put more effort into comparing programs
- Programs have room for improvement
Reasons for Joining a Travel Loyalty Program
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- Frequent travel program members prefer programs without annual fees
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- Figure 18: Reasons for joining a loyalty program, March 2017
- Outside of no annual fee, members want reward options and upgrades
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- Figure 19: TURF analysis – Reasons for joining a loyalty program, March 2017
- Under 45s seek reward options and are less opposed to annual fees
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- Figure 20: Reasons for joining a loyalty program – Select items, by age, March 2017
- Hispanics look for high point to dollar ratio and anniversary rewards
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- Figure 21: Reasons for joining a loyalty program – Select items, by race and Hispanic origin, March 2017
Desired Rewards from Hotel and Airline Programs
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- Program members want free night stays and free flights
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- Figure 22: Desired rewards, by hotels and airlines, March 2017
- “Free” rewards rule: women want easier travel, men want airline perks
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- Figure 23: Desired rewards – Select items, by gender, March 2017
- 34% of program members aged 18-44 want complimentary in-flight WiFi
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- Figure 24: Desired rewards – Airline items – Complimentary in-flight WiFi, by age, March 2017
- Business travelers want flight upgrades, priority, and in-flight perks
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- Figure 25: Desired rewards – Airline items, by type of past year travel, March 2017
Reward Options Likely to Redeem
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- Program members want cash-back bonuses and gift cards
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- Figure 26: Reward options likely to redeem, March 2017
- Experience-based rewards elicit greater interest among young travelers
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- Figure 27: Reward options likely to redeem – Select items, by age, March 2017
- Sporting events, tech, cooking classes pique Hispanics’ interest
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- Figure 28: Reward options likely to redeem – Select items, by race and Hispanic origin, March 2017
Engagement with Loyalty Programs
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- 37% use points for travel, 26% belong to a program they never use
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- Figure 29: Engagement with loyalty programs, March 2017
- Men are more likely to invest time and money in their loyalty programs
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- Figure 30: Engagement with loyalty programs – Select items, by gender, March 2017
- Under 25s are most likely to compare programs before they join
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- Figure 31: Engagement with loyalty programs – Compare programs before joining, by age, March 2017
- Travelers don’t feel they earn enough points for the rewards they want
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- Figure 32: Engagement with loyalty programs – Select items, by type of past year travel, March 2017
Attitudes toward Loyalty Programs
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- Programs have opportunities for improvement to boost loyalty
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- Figure 33: Attitudes toward loyalty programs, March 2017
- 35% of members only book travel through travel rewards programs
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- Figure 34: Travel booking loyalty segments, March 2017
- Program Professionals are highly engaged, aware of loyalty program offerings
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- Figure 35: Attitudes toward loyalty programs – Dedication, by travel booking loyalty segments, March 2017
- Program Professionals think they can find a better deal on their own
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- Figure 36: Attitudes toward loyalty programs – Struggles, by travel booking loyalty segments, March 2017
- Loyalty programs have room to improve
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- Figure 37: Attitudes toward loyalty programs – Program improvements, by travel booking loyalty segments, March 2017
Appendix – Data Sources and Abbreviations
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- Data sources
- Consumer survey data
- Abbreviations and terms
- Abbreviations
- Terms
- TURF methodology
Appendix – The Market
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- Figure 38: Frequent Flyer program memberships, by memberships, 2016
- Figure 39: Hotel loyalty/rewards program memberships, by memberships, 2016
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- Figure 40: US vehicle rental privilege program/club memberships, by memberships, 2016
- Figure 41: Frequent Flyer program memberships, by major US airline, 2011-16
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- Figure 42: Hotel loyalty/rewards program memberships, by major US hotels, 2015-16
- Figure 43: US vehicle rental privilege program/club memberships, by brand, 2011-16
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