As travel sees signs of recovery around the world, including Saudi Arabia, Peter Gerstle, Head of Travel Products at Collinson, shares his views on the importance of travel loyalty in Saudi Arabia. The country is investing heavily in tourism by making tourist visas more accessible, and in-line with Saudi’s vision 2030 the country is set to boom across all sectors, specifically tourism. In the interview, Peter shares his expertise on the best way for travel brands to get travellers to subscribe to travel loyalty programmes, how travel loyalty will adapt post pandemic, and the top three latest trends in travel loyalty right now.
The interview was published in Al Jazirah, an Arabic daily newspaper in Saudi Arabia.
1. Can you tell us a little bit about Collinson and your role at Collinson?
With its market leading airport experiences programme, Priority Pass, it’s travel insurance, identity assistance, flight delay, international health and travel risk management solutions, Collinson is a global leader in customer benefits and loyalty.
My expertise lies in designing loyalty propositions that engage the customer beyond traditional earn-and-burn programme design, and create value to brands and programme members alike. In my role at Collinson, I oversee areas of travel loyalty strategy, proposition development and travel sector insight. Currently, I am helping clients better understand the role of paid loyalty in their broader strategy and how to implement the concept practically.
2. As travel sees signs of recovery around the world and in Saudi Arabia as well. The country is investing heavily in tourism by making tourist visas more accessible. How important is it to build relationships with travellers coming to Saudi Arabia for the first time and maintaining the relationship with frequent travellers?
Building and strengthening relationships is critical, especially post-pandemic when many customers have either separated from existing loyalty relationships (voluntarily or not!) or are simply reevaluating their options.
Many people also find themselves in new work and life patterns, which directly impacts their travel behaviour. I predict a much stronger blending of business and leisure travel (aka ‘Bleisure’, that awkward word), as much as the work and life separation becomes more fluid. Therein lies an opportunity, especially for destinations, as they can promote themselves in a much wider way. Also, ‘destination trial’ is supported where travellers tag on a few leisure days to a business trip.
Loyalty is about responding to customer insight, engaging beyond the stay, rewarding advocacy and broadening the brand’s relevance.
For Saudi Arabia specifically, the immediate focus will be on sharing information and insight. Information that is relevant to the traveller based on their stated preferences, but also showcasing the country’s heritage, culture, leisure and entertainment venues, and helping potential customers to learn about new things about the country and be rewarded for their experiences .
3. Do you expect travel loyalty programs to adapt to provide travellers who can’t travel as frequently as before with the same benefits that existed before the pandemic?
Loyalty programs must regularly adapt to their own business and customers’ changing commercial and behavioural context. Loyalty programs have to reflect these circumstances. Program rules (e.g. qualification metrics, reward conditions), Benefits set (earning and redemption rates, recognition services, partner offers), Communications strategy (‘don’t hammer it in’). Collecting, analysing and responding to data is core to all of this.
I expect loyalty programs of the future to be even more data-led and adapt quickly to changes in a wider context. Programmes should also reflect individual customer circumstances, such as reasons for changes in travel patterns and recognise relative share given rather than absolute spend.
4. In line with Saudi’s Vision 2030, the Kingdom of Saudi Arabia is set to boom across all sectors specifically tourism. As travel brands jump on this bandwagon, what is your advice for the best way that travel brands can get travellers to subscribe to a loyalty travel program?
Firstly, I would not label it as a loyalty program from the outset. That implies frequency and is not applicable in a tourism context. Possibly a bit more in business travel, but then you need to consider what you want a business traveller to be loyal to and what they have decision over.
For leisure tourism, “Loyalty” is more powerful if designed as an engagement program to drive local consumption (tours, restaurant, events, etc.) and to open a strong communication channel for pre- and post-visit engagement.
Fundamentally, a customer will sign up to a program (in other words share their data) if there is a beneficial value to them. That can take the form of a reward or special offer or some enhanced recognition or access to something valuable, exclusive and aspirational.
5. Could you tell us about the three latest trends in travel loyalty?
Whilst loyalty has always been to some degree about data, the next frontier for truly successful loyalty programs lies in data. Better motivational tactics to collect data (esp. zero- and first-party data, as new online data regulations, take hold), New analytical capabilities, increased use of machine learning and AI for accurate behaviour predictions and better commercial program modelling for more accurate valuation of the loyalty contribution to core revenue.
- Paid Loyalty / more instant gratification
As Millennials and Generation Z become commercially mature, loyalty needs to promote new ways to connect to a brand. Paid Loyalty is the strategy of the times, allowing brands to engage with customers immediately and for these customers to instantly benefit from a clear set of services – not some vague future promise.
- Mixing work and life
Loyalty program design needs to reflect the changing travel patterns, changing reasons, and reflect earning and redemption offers accordingly. On the earning side, this might mean a wider range of opportunities to get rewarded; on the redemption side, better access to reward flight inventory and better transferability of rewards (e.g. bring the family over after a workweek in an attractive destination)
It would be remiss of me not to mention sustainability and loyalty: I am convinced that loyalty must take a proactive role in supporting and rewarding sustainable behaviour across the travel spectrum. Etihad and Qantas have recently launched interesting initiatives, and other travel brands will undoubtedly follow.