I’m sitting in on the Airline Information Spring FFP event today and absorbing a tremendous amount of information from both the programs themselves and the consulting and services organizations which exist around them to help make the all the points actually have value. There have been panel discussions, keynotes and product pitches and synthesizing all the data will take some time but I was particularly intrigued by one comment I heard and thought it worth sharing.
The manager of loyalty for a pretty big airline was commenting about how their program has shifted the tone of their marketing to a number of members recently. After hearing through interviews and focus groups that many members described themselves as "only a silver" or such it became clear that, while it is important to have customers who strive to higher tiers, the programs need to do a better job of having some members embrace their status at lower tiers.
Much of the segmentation comes from looking at who is actually close to reaching that next status level or if the company can incent them to reasonably make that stretch versus customers who will never get there. In other words, tiers within the tiers. Marketing to a customer who barely reaches the 25K miles level every year will be very different from that focused on a customer who is at 40-45K annually. And the marketing also can shift based on the revenue model those customers present to the company.
This is hardly a ground-breaking revelation, but it is still interesting to hear how the airline programs are working to implement it. Even more interesting was hearing about the push-back from the sales side of the house when the loyalty folks tried to explain that they didn’t want to push on some customers so hard. At least for the airline relating the story, however, the results were quite positive.
Turns out that knowing your customer well is, in many cases, an even better marketing tool than dangling status level in front of them.