Lately we’re seeing an exciting shift in airline loyalty from red tape “benefits” to new, more aggressive and partner focused perks which move the needle by actually getting used, thanks to ease.
It’s exciting times because the worst airline benefits have long masqueraded as some of the best — aka benefits which sound great but are so wrapped up in red tape that most people aren’t able to redeem them.
The worst loyalty benefit is almost always the one that gets redeemed the least by eligible customers and finally, the long loved term of “breakage” in the airline world is becoming a dirty word.
Breakage Is For Broken Loyalty Minds
Unsurprising to the many pessimists who read this blog, many airline benefits were designed to be hard to use. Yes, failures by design!
Even when they aren’t, some just simply can’t overcome the terms and conditions added to protect the airline’s revenue, which cut away at their power. This “breakage” where someone doesn’t actually manage to use something was once very loved in the game.
Only recently have loyalty businesses once again focused on benefits that people get to use, and realized how bad it is when you dangle a carrot people can’t reach.
In virtually all cases, benefits are designed to sound aspirational and send people on loyalty journeys to unlock them — that’s the whole point of loyalty. So why can’t we get this part right? Sadly, it’s not a 10 second news soundbite, but in a word money is the answer.
Let’s break down the crux of the problem: money, on both sides.
Benefits which sound great, such as a “free companion ticket” when you hit a certain “elite status” threshold do indeed sound great, but they’re expensive for an airline to offer when they’re red tape free and really juicy.
Often when you learn about how they work, often too late, you quickly figure out that you’d need to read a dissertation or two, to get the perk to work for your trip needs. If you have to change plans or take an inferior journey just to make a benefit work, it’s a liability, not a benefit.
When a benefit only works on certain fares types, cannot be combined with other offers and require the companion to book into reward space which is much harder to find — and — you still need to pay full taxes and carrier fees, that “dream perk” which sounds like its worth thousands is more burden than joy, to 99% of people.
Yep, that was a long sentence slash paragraph, but that level of detail is where we get lost and give up on what should be exciting perks.
The best benefits have the shortest terms and conditions.
Benefits like “systemwide upgrades” have been around forever and were once idyllic, but significant red tape has been added and even greater challenges to find usability are everywhere as more people earn them and airlines fly already full premium cabins.
The only way to improve these benefits is for airlines to invest more in them, which is a tricky piece of work for flyers. More investment in the current climate means creating more financial certainty that the people you’re giving the perks to are worth the extra expense required to reduce the red tape and remove restrictions.
It’s a lot more “expensive” for the loyalty program to convince the airline to allow any bearer of a systemwide upgrade to cash it in for any flight if any seat is available at all, regardless of how you booked, so the airline is going to want to see all the things we all collectively gripe about.
Higher spend, more alignment of status and money, and all that jazz. We need to be careful for what we wish for, because many benefits which are currently difficult to redeem, but are also conceptually exciting will likely get easier to use, as less profitable members are excluded from them either by dropping tier, or increasing requirement.
Exciting New Loyalty Benefits
You’ve gotta hand it to JetBlue lately. The airline may be marred in legal and financial squabbles but their loyalty program has never been more appealing.
Like other brands taking a “next gen” approach to loyalty, their new perks are solving true pain points and are potentially even reducing the costs associated with these new benefits, by using mutually beneficial wins for partners.
I always say that talk is cheap and getting people to actually swap loyalty is difficult, but I’ve seen real examples of JetBlue capturing disgruntled loyalty from other programs. That in itself is proof that something new and fresh is working.
One brilliant example: JetBlue is offering elite frequent flyers perks, even those on status matches, opportunities which truly enhance their journey like complimentary Blade helicopter transfers to the airport and easy to redeem upgrades.
For the Blade rides, this is an already aspirational and functional way to travel, and JetBlue is making it clear that you matter enough to deserve some rides on the house. For someone heading to a flight during rush hour from midtown, or to the city from JFK during peak times, this can be a time savings of hours.
For Blade, it’s a great partnership to hook frequent travelers into their offering, long after their free rides expire. I’m a fair example of this. I took an early ride during a hot discount promotion and being that most of my flights leave JFK around 7PM, which would put me in hellacious traffic to get there, I’m all in on Blade.
More Partner Loyalty Wins
Another great example of new generation partner loyalty is CLEAR. The efficacy of CLEAR is generally excellent for expediting US TSA security screening and airlines have invested in getting significant discounts for elite members.
A Delta Diamond gets free access to CLEAR, providing $189 of tangible value as a perk. Other elites get $40 off, which is still a discount value people really see and feel when completing their transaction. To be clear, American and United also offer discounts on CLEAR.
US airlines have actually been leaders at offering “choice” in elite status benefits, which helps to reduce the breakage factor and create personalization for valuable members. If someone doesn’t choose a benefit, it’s not breakage, it’s just personal choice.
American’s “loyalty points” game has been a leader in this lately.
The people behind these “choice” programs will also be able to see and understand the trends of which choices are the most popular, and why some of the lesser popular ones are still worth keeping, based on the reasons a customer might have for choosing it.
Take Stock On Your Current Benefits
I always advise travelers to play games that offer prizes they want and will use. Don’t go down journeys just for the ego of attaining something because blogs say it’s cool, or because it sounds elite.
If you don’t use the benefits enough to justify the expense and the opportunity cost, you’re doing it wrong.
One of the healthiest things someone can do as we approach a new calendar year of loyalty is to take a look at eligible benefits from loyalty in 2023 and ask the following questions.
- Did you use all of your benefits?
- If not, why didn’t you use them, and do you regret earning them?
- Were there any which were motivating, which you couldn’t make use of?
- Is another program offering benefits which better align to your lifestyle?
With these questions always top of mind it’s easy to see the value and (point!) of loyalty. We’re on the cusp of exciting times as airlines stop playing for breakage and start leaning into benefits which impact our lives for the better, both at the airport and when away.
There’s really nothing better for engendering loyalty than reaching a customer on an emotional level, and that’s often when they’re home, or enjoying other passions.