New Survey Reveals Travelers Think Grocery Stores Offer Better Loyalty Programs Than Hotels; Airlines

Loyalty has gone out the window, a new Deloitte survey finds. Only eight percent of survey respondents say that they always stay at the same hotel brand, while just 14% say they always fly the same airline.

“With heightened competition and eroding customer loyalty, hotels and airlines, now, more than ever, need to focus on enhancing and personalizing the consumer experience,” said Adam Weissenberg, vice chairman, Deloitte LLP and U.S. Travel, Hospitality and Leisure leader in a release.

Despite most hotel brands touting that loyalty and reward programs drive travel, these programs ranked low on the list of consumer influences – value and past experience were much higher priority items. That said, more than half of survey respondents (55%) ranked loyalty programs “high importance” for airlines and just under half (45%) ranked loyalty programs high importance for hotels.

Why? Perhaps it’s because travelers find that loyalty programs just don’t offer that much. Most consumers actually believe that grocery store loyalty programs offer more bang for their buck than their travel reward program of choice.

Deloitte researchers also suppose that travelers have become more pragmatic in light of the economy, seeking value for money, comfort and location when choosing a hotel, while on-time arrivals and departures, safety and value for money are the most important factors for choosing an airline. One thing is for sure – value rules. In this vein, half of survey respondents (49%) said that they have used flash sale sites, although most admit to booking directly (61% for hotel; 59% for air travel).

What does this mean for the consumer? Not much – yet. But it doesn’t bode well for the travel industry. Brands wanting to up their loyalty membership engagement should focus on those things that really matter to the traveler – experience and value – rather than perks that sound good on paper but offer no real benefit.

The web-based survey was commissioned by Deloitte and polled 4,000 hotel and airline customers, based on hotel stay and/or airline travel during the past 12 months.

[Image Credit: American Airlines]

Loyalty Programs Change, Evolve With Mergers

Loyalty programs keep travelers coming back, granting more perks and benefits the more they use a service provider. But what happens as the world of travel evolves and companies merge to gain efficiency and price advantage or just to stay in business? In some cases, the customer comes out ahead.

Southwest Airlines’ merger with the AirTran Airways subsidiary is well underway. Though not yet complete, the company is bringing the benefits of each carrier’s frequent flier program to the members of both.

Air travelers who are members of both Southwest’s Rapid Rewards program and AirTran’s A+ Rewards plan can shift program credits between the two in order to redeem award travel on either airline.

The move gives Southwest Rapid Rewards members some new vacation options. AirTran flies to destinations Southwest doesn’t serve in Mexico and the Caribbean. Still, only credit transfers between accounts are allowed, as the two loyalty programs remain separate.

“Rapid Rewards members can transfer 1,200 program points or one Rapids Rewards credit into one A+ Rewards credit. AirTran frequent flyers can switch one A+ credit into one Rapid Rewards credit. The A+ program requires 16 credits for one round-trip coach ticket on AirTran, and Southwest’s program requires 16 credits for one Standard Award ticket. Thirty-two A+ Rewards credits are worth one Freedom Award in the Southwest program,” said an article in Executive Travel Magazine.

Thinking of other frequent flier programs, a common question is raised: What might happen to accumulated points if a proposed merger of American Airlines and US Airways occurs?

Experts agree: probably not much.

“All things being equal, I would expect a merged American-US Airways frequent flier program to be somewhat less generous than the two airlines’ programs today,” said Seth Kaplan, managing partner of Airline Weekly in a Reuters report. “Maybe you’ll need more miles for free tickets to certain regions, or maybe award seats will be more scarce, or maybe it’ll be harder for elite fliers to get first-class upgrades.”

Kaplan offers the following advice:

  • Start using up your miles, particularly if you’re interested in flying on a carrier in an alliance that might not be available to you when the deal is done.
  • Shop around to see whether another airline would meet your needs. But make sure the carrier flies the routes you most travel. This way when one of them starts dangling offers to lure you, you’ll know if it’s a smart move to shift your loyalties.
  • Take advantage of deals still being offered in the current programs, such as free upgrades.

The notion that travelers are “married to their frequent traveler programs” may not be a stretch. In a survey conducted in January by Starwood Preferred Guest, 73 percent of participants chose their loyalty program benefits over a spouse if they could take just one on the road.

[Flickr photo by Thomas Hawk]

Traxo launches “Travel Score,” a points-based rewards system for travelers

You’re the ‘mayor’ of both your gym and local coffee shop, your credit and Klout scores are off the charts and you’re a platinum member of your preferred airline. Now, in addition to regularly racking up miles and points, you can also tout your new Traxo Travel Score.

Traxo, a useful web-based company that tracks all of your travel loyalty programs in one place and uses social sharing options to let you share trips across your social media friend base, today has launched their newest feature, the Traxo Travel ScoreTM, billed as “the official measure of one’s overall travel experience.”

How does it work? The company says that the score is based on a patent-pending algorithm that awards travelers a score between 1 and 100 by taking into account over a dozen travel variables that includes the number of unique states and countries visited, the total miles traveled, the total days traveled, and the total status achieved across all the various travel loyalty and mileage programs and whether the trip was confirmed by Traxo. Travelers with the highest scores will enjoy the best travel perks.”With the Traxo Travel Score, we help you display and unlock the benefits of your travel experiences beyond the perks you are already getting from individual loyalty programs.” said Andres Fabris, CEO of Traxo. “A high Traxo Travel Score rewards travelers with both bragging rights and tangible travel perks, while identifying the most valuable consumers for our corporate partners.”

In order to test the program, we set up a Traxo account and linked up our current rewards programs. While the process took a bit of time, we liked that we now only have one hub for finding our rewards activity – although it doesn’t help us when we’re entering frequent flier data on new or existing reservations. Instead, the program just tracks our existing and upcoming trips and rewards activity. Still, the program was simple and easy to use, and over 100 travel partners ensure that most all rewards programs are already in the system (we noticed Kimpton was missing, but that was it).

The travel score also promises to retroactively pull up past location from over a dozen travel and check-in services. For travel providers not yet connected with Traxo, members can manually input their trip details that are then incorporated into their scores. Going forward, Traxo does all the work, automatically weighing all travel booked into each members’ score.

But of course, no new web program is complete without some sort of reward – travelers who achieve a Traxo Travel Score of 90 and above will be eligible to win a Traxo Travel Perk like a round trip ticket on South African Airways or adventure luggage from Briggs and Riley. Travelers who achieve a score of 80 and above will earn the Traxo Travel Perk of their choice, such as free Avis or Budget car rental voucher, a free one-year subscription to Condé Nast Traveler magazine, free travel insurance from World Nomads, and free access to the Virgin America club lounge. Traxo is currently working with top travel brands to add even more travel perks.

We’re excited to see where this goes – the concept of Klout for travelers, particularly travel writers like us, would be very fun.

Five business travel challenges for small companies to overcome

Regardless of economic conditions, owning and running a small business isn’t easy. It’s always tough to find clients, allocate your funds effectively and maximize your bang for the buck. And, business travel is a big part of this. When you go out on the road, you know you’re committing some serious cash to the endeavor, and you want to make sure you get as much value out of it as possible.

Part of this has nothing to do with what you’re spending: you want to make sure the reasons for your business trip are smart. But, you also need to keep an eye on the expense side of this to ensure you aren’t spending unnecessarily. Business planning covers the first aspect of this, and travel planning addresses the second.

So, how can white collar travel folks spend more intelligently on business travel? Here are five ideas:

1. Forget brand: are you loyal to a particular airline? Cut those ties. Sure, you’re thinking that accumulating miles can get you free business travel later … and there is some truth to that. However, you could be spending more than the price of a ticket when working toward that benefit. Also, there may be constraints on when you can take free travel.
2. Stay a little loyal, though: even if you aren’t buying on loyalty, you should still enroll in the loyalty programs for every airline, rental car company and hotel you use. It may take longer to accumulate benefits when you spread your purchases around, but the free perks you receive won’t come at the (literal) expense of your travel budget.

3. Shop around a bit: time is money, and the hours you spend looking for a flight are hours you could sink into other business activities. So, look at your effective rate per hour (i.e., how much your time is worth). Let’s say, for example, that an hour of your time is worth $100. If you could spend an hour to save $250 on a flight, that’s a good return – swallow the pill and do some comparison shopping for airfare and room rates.

4. Look at alternatives to airline loyalty: some online travel agencies have loyalty programs. Remember to join them, as you can accumulate benefits with them as well as with the airlines. As with airline choices, though, don’t choose a particular booking site just to accumulate points. Cash comes first!

5. Play the credit card game: use a branded credit card to make your travel arrangements. Choose one for the airline you use most. So, if you have a Delta card and wind up flying American Airlines every now and then to save money, you’ll still accumulate some benefits with Delta. Just don’t forget to pay the card off at the end of the month!

[photo by codepo8 via Flickr]

Join the program – Hotel tip

Whether this is your first time at a hotel or you are a regular, you should always be a member of the chain’s loyalty program.

There isn’t a charge to join and – with your very first stay – you start gaining points. Points can be used for free nights and other perks. Some programs (like Hilton Honors) will even let you exchange points for miles in airline programs.

Members of the hotel’s loyalty program also have a better chance of getting upgrades, so make it a habit to join the program.