Participation in travel loyalty schemes drops 31%

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By: Wise Marketer Staff |

Posted on August 6, 2009

Travel industry loyalty marketing and rewards programmes have seen a 31.2% decline in active participation since 2007, according to Colloquy's research into US consumer attitudes and perceptions in the recession economy.

Translated, this 31.2% drop means the general population actively participated in only 1.5 travel-related loyalty programmes in 2009 compared to 2.18 programmes in 2007 (when Colloquy last completed similar cross-demographic research).

Overall, however, consumer participation in rewards programmes in the US market has increased by 19% since 2007, the research showed. These latest travel-specific results indicate that consumers are now consolidating their spend with fewer hotels and fewer airlines, as the "travel-whenever-you-want-for-business" bubble has burst and so-called 'road warriors' are no longer able to earn Elite status in multiple loyalty programmes.

"These numbers shouldn't be daunting to travel loyalty industry pioneers who launched programmes in the early 1980s in another acute recession," said Colloquy partner Kelly Hlavinka. "One preferred hotel and one preferred airline - that's how loyalty programmes were supposed to work all along."

Indeed, smart travel marketers should see the recession as an opportunity to lock consolidating travellers into their own programme, knowing that they'll emerge in a much stronger competitive position when travel increases again.

Another significant finding from the research confirms the importance that consumers attach to loyalty programmes, despite the challenges presented by the worst recession in the last fifty years. Some 32.3% of consumers said that the recession has made their participation in retail rewards programmes more important, and the financial services sector scored 23.9%.

However, in the travel sector, only lower 21.5% of respondents said that rewards programmes are more important in the recession economy.

Other significant findings from the survey included:

  • Only 48% of respondents said they would be disappointed if their travel rewards programme was discontinued (a lower figure than for any financial services or retail programme).
  • The average number of travel rewards programmes to which consumers belong dropped to 2.0 in 2009 from 2.77 in 2007. Affluent consumers reported a higher level of participation in travel reward programmes than any other demographic segment.
  • Millennial consumers view travel rewards more favourably than any other demographic segment, with 35% saying travel rewards are of increased importance in the recession economy.

The full white paper, entitled 'After the Meltdown: Consumer Attitudes and Perceptions About Loyalty programmes in the Post-Recession Economy', has been made available for a free download from Colloquy's web site - click here (free registration required).

A condensed report highlighting the travel rewards findings and insights from the full white paper has also been made available for free download - click here (PDF document; no registration required).

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