While airline loyalty benefits appeal, 58% don’t know how to redeem points
IBS Software Launches its First Ever Customer Survey on Airline Loyalty Programs in the APAC region
IBS Software partnered with YouGov to commission its inaugural consumer survey around Airline Loyalty Programs (ALP) in key travel centers across the APAC region. The study polled 1500 travellers from Singapore, Hong Kong and Dubai, seeking to gain insight into the perceived benefits of loyalty programs as well as the key factors stopping non-members from joining.
ALP insight in APAC: key findings
Airline loyalty has a huge base - the majority
of travellers are members of an ALP - as many as 63% of respondents, which included both
leisure and business travellers, are members of an ALP – with the majority
belonging to at least two airline programs. There is also a wider trend for take-up
of loyalty programs in the region – nearly eight in ten said they are part of other
loyalty schemes, including supermarkets (44%), clothing brands (36%), and
- Lounge access and upgrades are seen as the top benefits - among current ALP members the top advantages of membership are exclusive access to lounges (chosen by 32%), cabin class upgrades (31%), followed by travel discounts (28%). For leisure travellers, upgrades and airlines guaranteeing points will not expire are the most appealing benefits, with fast-track check-in, immediate rewards and free tickets to events appeal most to business travellers.
However, despite this strong base of airline loyalty members, there is a knowledge gap that threatens greater engagement:
- Missed opportunity: members are not clear where they can use their points - but despite widespread adoption of ALP schemes and perceived benefits, members feel unable to make the most of them. More than half (58%) said they are unsure where they can redeem points.
- Most members of ALPs are unaware of the value of the points they have earned - the feeling that members are unable to take full advantage of their membership is perhaps explaining by the finding that as many as 56% of respondents admitted they are unaware of the financial value they have built up in their loyalty programs. This figure jumps to 64% in Singapore and the UAE.
This lack of clarity also jeopardises greater involvement in ALPs:
Non-members lack of awareness of the value of ALPs – of the 37% of respondents who have either never been a member of a loyalty program or whose membership had lapsed, the main reason cited for non-membership were not flying frequently enough to make it worthwhile and a lack of awareness of the benefits (both chosen by 30% of respondents). Nearly a quarter (23%) said they felt it was too hard to build up points.
Despite this knowledge gap, latent demand among non-members represents a major opportunity for airlines:
More than half of non-members said they would
consider ALP membership -
58% of respondents not already part of a loyalty program
would be willing to try one in the future. This figure was even higher for
younger travellers – more than two-thirds of respondents agreed 26-35 year said
they would be prepared to join. Easy check-in (46%) and cabin class upgrades
(44%) were highlighted as the top two reasons a non-member would be willing to
Breakdown of ALP insight by market:
There is a high adoption of loyalty programs in Dubai, with more than half of respondents are already a member of an ALP – with respondents citing class upgrades, discounts on travel experiences and exclusive lounge access as the most appealing elements of an ALP. However, of the markets surveyed, Dubai travellers were the least aware of the redemption process.
Conversely, in Dubai non-members were the most willing
to try an ALP. Infrequent flying and insufficient knowledge of ALP benefits
were the top barriers to membership. Free seat reservation and great customer
experience were deemed to be the main motivating factors to join.
Overall, more than half of respondents said they are
looking for more customised experiences – in particular flexible bookings,
access to travel documentation and additional discounts. Almost six in ten (58%)
agreed they are more likely to buy additional services from an airline when targeted
with personalized offers, perks and benefits based on their previous online behaviour
- Almost two-thirds (63%) of respondents in Singapore are
ALP members, with membership highest in travellers aged 36-45 years. Non-expiration
of points, class upgrades, discounts on travel experiences and exclusive lounge
access are the top benefits for members. However, less than half are aware how
to redeem points.
- Among those who are not currently ALP members,
infrequent flying and concern about the difficulty of gaining points are the
top barriers to membership – although 58% would consider joining. Class upgrades
are the top perk that could attract non-members to join.
- The majority said they are looking for more customised
experiences from an ALP, especially flexible bookings and additional discounts.
More than half (53%) also said they are more likely to buy additional services
from an airline that targets them with personalized offers, perks and benefits
based on their previous online behaviour and preferences.
- Hong Kong has the highest adoption of loyalty programs
among the markets surveyed. Three-quarters are members of ALPs – possibly due
to respondents travelling more than five times per year, the highest of the
markets surveyed. Members of ALPs in Hong Kong are most driven by immediate
benefits like easy check-in and immediate rewards along with exclusive access
to lounges and class upgrades – and, interestingly, ALP membership was highest
among travellers aged 25-36 years.
- Consistent with other markets, among
non-members infrequent flying and lack of ALP knowledge were the top
barriers – but 46% would be prepared to trial an ALP
check-in options were cited as the main factor that could attract non-members.
- Overall, 60% said they are looking for more customised experiences, with the most desired online experiences being additional discounts, flexible bookings and access to travel documentation.