Table of Contents
Introduction and Abbreviations
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- Introduction
- Other relevant reports
- Airlines—UK, Leisure Intelligence, June 2005
- Definition
- Abbreviations and terms
- Abbreviations
- Terms
Executive Summary
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- Loyalty points multiply as consumers enjoy new ways to stockpile
- Loyalty programs become a commodity—are they all one in the same?
- Opportunity for loyalty program membership growth remains
- Airline industry remains unstable
- Discount airlines cause turbulence
- Loyalty programs of major carriers favored among majority
- Younger consumers drawn to discount carrier loyalty programs
- Treat me special: individualism reigns
- Travel industry showing gains
- The new face of business travel
- Red tape generates customer frustration
- Convenience becomes key ‘soft perk’ for loyalty program members
- Internet gives an edge to consumers
- Future of loyalty programs
Market Factors
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- Overall travel trends
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- Figure 1: Travel expenditures in the U.S., at current and constant prices, 2000-05
- Figure 2: Graph: Travel expenditures in the U.S., at current and constant prices, 2000-05
- Trends in length of stay
- Business vs leisure travel
- Business travel
- Companies: “What’s in it for us?”
- Catering to business travelers
- Small business travelers targeted
- Leisure travel
- Leisure needs differ by generation
- Major travel loyalty sectors
- Air travel
- Introduction
- Market size and overall trends
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- Figure 3: Total U.S. scheduled airline passenger revenue, at current and constant prices, 1999-2004
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- Figure 4: Graph: Total U.S. scheduled airline passenger revenue, at current and constant prices, 1999-2004
- Air travel and loyalty programs
- Customer satisfaction with the airline industry
- Concern about stability of travel loyalty programs
- Rental car company loyalty driven by flexibility, innovation
- Focus on business travelers
- Market size and overall trends
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- Figure 5: Total U.S. car rental revenues, at current and constant prices, 1999-2004
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- Figure 6: Graph: Total U.S. car rental revenues, at current and constant prices, 1999-2004
- Hotels
- Hotel travel segment trends
- The Internet and travel booking
- Online distribution channels changing the way consumers book travel
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- Figure 7: Total U.S. retail sales of internet travel bookings, at current and constant prices, 2000-2005
- Internet changing the way travel suppliers conduct business
Market Background
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- Loyalty Programs Overview
- Customer loyalty defined
- Loyalty programs—why they started
- Loyalty programs—structures, components and operation
- Introduction
- Components and enrollment
- Hard and soft perks
- Loyalty program customizing
- CRM and database generation
- Market differentiation and prediction
- CRM: Customer service and satisfaction
- Loosening ties and broadening options
- Best price guarantees
- The Internet and loyalty programs
- Perks that promote
- Unredeemed Miles
- Overview
- Number of unredeemed miles
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- Figure 8: Total airline loyalty program unredeemed miles, 2000-2005
- Airmiles as airline liability
- Airmiles as airline asset
- Trading airmiles
- Difficulties of redeeming airmiles
- Other redemption offers
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- Figure 9: Total redeemed travel rewards, 1999-2004
- Rewards for the high milers
Loyalty Programs by Sector
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- Introduction
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- Figure 10: Top airline loyalty program providers, membership 2005
- Figure 11: Graph: Top airline loyalty program providers, membership 2005
- Airline Global Alliances
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- Figure 12: Top 3 airline global alliances, 2005
- Star Alliance
- SkyTeam
- OneWorld
- Discount airlines overview
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- Figure 13: Name and type of frequent flyer programs, by discount airlines, January 2005
- Airline loyalty programs
- American Airlines
- Program overview
- Program partners and co-branding
- Unredeemed miles liability
- Company background
- United
- Program overview
- Partners and co-branding
- Online activities
- Company background
- Delta Airlines
- Program overview
- Partners and co-branding
- Company background
- Northwest Airlines
- Program overview
- Partners and co-branding
- Company background
- Continental
- Program overview
- Unredeemed points liability
- Company background
- US Airways
- Program overview
- Company background
- America West
- Program overview
- Partners and co-branding
- Company background
- Southwest Airlines
- Program overview
- Company background
- JetBlue
- Program overview
- Company background
- Hotel Loyalty Programs
- Introduction
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- Figure 14: Top 5 Hotel loyalty program providers, membership 2005
- Marriott International
- Program overview
- Company background
- Accor Lodging
- Program overview
- Company background
- Starwood Hotels & Resorts
- Program overview
- Partners and co-branding
- Company background
- Hilton
- Program overview
- Partners and co-branding
- Company background
- Cendant Corporation
- Program overview
- Company background
- InterContinental Hotel Group
- Program overview
- Partners and co-branding
- Company background
- Carlson Companies
- Program overview
- Company background
- Choice Hotels International
- Program overview
- Partners and co-branding
- Company background
- Hyatt Hotels
- Program overview
- Company background
- Wyndham
- Program overview
- Company background
- Car Rental Loyalty Programs
- Introduction
- Enterprise
- Program overview
- Company background
- Hertz
- Program overview
- Partners and co-branding
- Company background
- Cendant Car Rental Group/Avis
- Program overview
- Partners and co-branding
- Company background
- Budget Rent a Car
- Program overview
- Partners and co-branding
- Company background
- Vanguard Car Rental USA
- Program overview
- Partners and co-branding
- Company background
- Dollar Thrifty Automotive Group (DTAG)
- Program overview
- Partners and co-branding
- Company background
- Internet travel companies
- Travelocity.com
- Orbitz
- Priceline
The Loyalty Program Consumer
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- Introduction
- Characteristics of loyalty program members
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- Figure 15: Participation in frequent flyer programs, by demographics, January-September, 2004
- Consumer FFP enrollment, by airline
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- Figure 16: Participation in specific frequent flyer programs, January-September, 2004
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- Figure 17: Participation in multiple frequent flyer programs, cross-tabulation, January-September 2004
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- Figure 18: participation in specific frequent flyer programs, by race/ethnicity, January-September 2004
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- Figure 19: Participation in specific frequent flyer programs, by age, January-September, 2004
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- Figure 20: Participation in specific frequent flyer programs, by household income, January-September 2004
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- Figure 21: Participation in specific frequent flyer programs, by region, January-September 2004
- Vehicle rental for business or personal usage
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- Figure 22: Rental of vehicles for business and/or personal use, by demographics, January-September, 2004
- Enrollment in specific car rental clubs
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- Figure 23: Participation in specific car rental clubs, January-September, 2004
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- Figure 24: Participation in multiple car rental clubs, cross-tabulation January-September, 2004
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- Figure 25: Participation in specific car rental clubs, by race/ethnicity, January-September 2004
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- Figure 26: Participation in specific car rental clubs, by age, January-September, 2004
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- Figure 27: Participation in specific car rental clubs, by household income, January-September 2004
- Summary
- Hotel frequent guest programs
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- Figure 28: Enrollment in hotel/motel frequent guest program, by demographics, January-September, 2004
Consumer Attitudes to Loyalty Programs
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- Introduction
- Enrollment in travel loyalty and rewards programs
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- Figure 29: Enrollment in travel loyalty and rewards programs, June 2005
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- Figure 30: Enrollment in travel loyalty and rewards programs, cross-tabulated by type of programs, June 2005
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- Figure 31: Enrollment in travel loyalty and rewards programs, by age, June 2005
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- Figure 32: Enrollment in travel loyalty and rewards programs, by household income, June 2005
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- Figure 33: Enrollment in travel loyalty and rewards programs, by marital status, June 2005
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- Figure 34: Enrollment in travel loyalty and rewards programs, by region, June 2005
- Number of leisure and business trips in past 12 months
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- Figure 35: Number of leisure, personal or business trips in the past 12 months, June 2005
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- Figure 36: Number of leisure, personal or business trips in the past 12 months, by gender, June 2005
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- Figure 37: Number of leisure, personal or business trips in the past 12 months, by age, June 2005
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- Figure 38: Number of leisure, personal or business trips in the past 12 months, by household income, June 2005
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- Figure 39: Number of leisure, personal or business trips in the past 12 months, by presence of children, June 2005
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- Figure 40: Number of leisure, personal or business trips in the past 12 months, by marital status, June 2005
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- Figure 41: Number of leisure, personal or business trips in the past 12 months, by region, June 2005
- How reward points are used, attitudes about future value of points
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- Figure 42: How reward points are used, June 2005
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- Figure 43: How reward points are used, by business travelers, June 2005
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- Figure 44: How reward points are used, by age, June 2005
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- Figure 45: How reward points are used, by household income, June 2005
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- Figure 46: How reward points are used, by region, June 2005
- Frequent flyer programs: attitudes about redemption, blackout dates and price vs loyalty
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- Figure 47: Attitudes about frequent flyer programs, June 2005
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- Figure 48: Attitudes about frequent flyer programs, by business travelers, June 2005
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- Figure 49: Attitudes about frequent flyer programs, by gender, June 2005
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- Figure 50: Attitudes about frequent flyer programs, by age, June 2005
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- Figure 51: Attitudes about frequent flyer programs, by household income, June 2005
- Location trumps loyalty for hotel choice
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- Figure 52: Hotel location or frequent guest program most important factor, June 2005
- Use of credit card to earn travel points
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- Figure 53: Use of co-branded credit card to earn travel miles, June 2005
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- Figure 54: Use of co-branded credit card to earn travel miles, by age, June 2005
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- Figure 55: Use of co-branded credit card to earn travel miles, by household income, June 2005
- Conclusion
Future & Forecast
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- Future Trends
- The U.S. economy
- The fate of the airline industry
- New fees may offer loyalty clubs opportunities to cater to upper tier members
- Soft perks will have an increasingly important role
- Personalization and flexibility key to building loyalty
- U.S. Travel trends
- Leisure travel
- Business Travel
- Internet travel research and booking
- Alliances and partnerships
- Sorting through sameness
- Credit card alliances
- New alliances
- Generating more loyalty through loyalty club membership
- Market forecast
- Total unredeemed airline loyalty program miles
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- Figure 56: Forecast of total unredeemed airline loyalty program miles, at current and constant prices, 2005-2010
- Forecast factors
Appendix: Trade Associations
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