Why travel points and miles are going unclaimed

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By: Wise Marketer Staff |

Posted on April 14, 2006

Although hotels in particular have greatly improved their provision of personalised service, airline and hotel loyalty programmes are still under-used with many members simply not redeeming their miles and points, according to a survey of business travellers by Accenture.

Almost one-third (31%) of the 1,128 US business travellers surveyed said that hotels recognise them as frequent customers and tailor reservations to fit their basic preferences, from major preferences such as room location through to the type of pillow provided. This represents a big improvement over last year's survey, when only 18% said they were recognised as frequent guests and had received customised service.

According to Paul Chiu, managing partner for Accenture's transportation and travel services practice, "Hotels know they must meet the needs of business travellers - their most profitable group of customers - and these results reflect the technology and process investments hotels have made during the past few years."

Loyalty points and redemptions
But while there has been progress, the survey results also showed still more room for improvement. According to the survey, some 40% of respondents have not redeemed any points from airline reward programmes and 56% have not redeemed any hotel reward programme points.

For hotel guests, redemption levels are perceived as a key problem: half of those surveyed (50%) said they have not used hotel rewards because too many points are required to earn a reward. For airline travel, 42% of respondents said they have not redeemed any miles because of restrictive blackout dates. When asked what they would use airline miles for, 51% said they would redeem them for a free flight, while 32% said they would use them to obtain a seat upgrade.

When business travellers dip into their points, most respondents said they would use them the same way they earned them - that is, redeeming frequent flyer miles for free airline tickets, and hotel reward points for free hotel stays.

Going online
Interestingly, flight bookings via the internet have continued to grow, as 76% of those surveyed said they use the internet as their primary method of making airline reservations (up from 57% in the 2003 survey). And the use of the internet to make hotel reservations has increased among business travellers as well: more than four in five respondents (83%) said they had used the internet to book a hotel room (up from 76% beforehand).

"As use of the internet becomes second nature for travellers, they will expect capabilities well beyond simple rate search and reservations," said Chiu. "These include features such as electronic folio access, virtual concierge and integrated trip planning."

Key findings
Other key findings of the business travel survey included:

  • Top destinations
    Chicago remains the US city most respondents said they planned to visit - but its popularity is slipping, with 27% of respondents in the most recent survey citing it as their main destination compared with 32% in the previous survey. Close behind are New York (24%), San Francisco (21%) and Washington, DC (20%).
  • Travellers are embracing kiosks
    Among the 89% of respondents using airport kiosks, more than two-thirds (68%) said they find it more convenient than checking in with an agent. Of those who have not used kiosks, 33% said they use online check-in instead, up from 22% in the previous survey.
  • Location beats price
    Close proximity to business meetings was cited as being more important to business travellers than price when deciding where to stay. Respondents reported that earning reward points was the least important factor in their accommodation decisions.
  • Convenience is key
    More than half (59%) of respondents said that a convenient schedule is the main factor in their choice of airline, while around one-third (34%) cited frequent flyer programmes as being the most influential factor. More than three-quarters (79%) said they would increase their use of low-cost carriers if those carriers offered more flights into main airports.

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