It’s always amazed me that airlines reward passengers for the distances they go rather than the outlay of dough. Think back to the mileage run made a few months ago by Gadling‘s esteemed top dog, Grant Martin. He sought the cheapest fare he could find to rack up the miles he needed for the next status level. The upside, of course, was another year of premier treatment, and the dollars he put out were essentially irrelevant. Meanwhile, a business traveler who spent the year dropping a few hundred bucks a week on shorter flights doesn’t get the same level of recognition, despite having spent far more. The airlines take care of the wrong passengers.
A better model for rewarding customer loyalty can be found in the hotel space. It doesn’t matter how many nights you spend in a hotel throughout the year – the points you pick up are based on the money you spend. Yet, frequency isn’t overlooked: you can amass status levels based on how often you stay. So, as long as you’re in a room, you benefit from how often you stay. When it comes to cashing in your points, you are recognized for how much you’ve spent.The doling of points based on your financial value reaches beyond the guestroom, as well. The money you spend in the restaurant, spa, gym and anywhere else translate to points. Meanwhile, the airlines only take into account how long you’ve occupied a seat. It doesn’t reflect your full value to the company.
For the airlines, the upside of a more appropriate award system could be greater than they realize. Even though business travelers rarely spend their own money on tickets, they do decide which airlines they’ll take. So, they control the cash, even if it isn’t their own. By thanking passengers in accordance with the financial commitments they make, the airlines could shift how they distribute their goodwill and turn unwilling passengers into regular fliers … and vocal advocates.