The nation’s largest ever loyalty program study from leading research company, Honeycomb Strategy, shows that while Australians love a loyalty program, they expect travel brands to deliver serious value – think discounts or exclusive experiences – to stay in their loyalty program line-up.
The Science of Loyalty – from Situationship to Relationship analysed 52 of Australia’s leading loyalty programs across travel, retail, telco/banking/finance and paid programs.
The study evaluated loyalty programs based on three key criteria: membership rates, consumer engagement and impact on consumer spending to identify the top performing programs.
Airline frequent flyer point programs have the highest rates of loyalty program membership, according to the study, with Qantas Frequent Flyer ranking in third place in terms of membership, behind FlyBuys and Everyday Rewards, and Virgin Velocity ranking fifth.
Nearly a third of Australian consumers said they exclusively used the top travel brands, Booking.com Genius and Qantas Frequent Flyer, based on their loyalty program offering, demonstrating the Australian travel companies delivering serious value.
While travel brands might be enjoying a loyalty club sign-up boom, many are struggling to keep Australians engaged.
The new report revealed most Australians only actively use five loyalty programs at once, with customer attention at an all-time low.
For travel brands, membership disengagement rates were highest for Emirates Skywards, followed by Marriott Bonvoy, and Singapore Airlines KrisFlyer.
Additionally, the research shows there is no correlation between the number or type of benefits offered and the success of the program; and the travel loyalty programs that do resonate with customers offer instant value, simplicity and real benefit.
The research showed seven in 10 customers expect immediate benefits from their loyalty programs, while 63% quickly lose interest if the program doesn’t give them something new or valuable.
“For most travel brands, the challenge isn’t providing the right mix, or more meaningful benefits, it’s delivering a loyalty program that addresses the other key areas that are commonly overlooked – frictionless engagement and triggers to engage,” said Renata Freund, Study author and Honeycomb Strategy Founder.
“The reality is that a large portion of Australia’s loyalty programs are great at driving the initial sign-up with a motivating benefit, but very few are translating that into ongoing engagement that ladders up to meaningful ROI.
“The travel brands that are doing this well are seeing loyalty translate into tangible impact on spend, not just membership vanity rates.”
Access the full report here
