Travel Tech CEO Series: Points International Aims to Upgrade Airline and Hotel Loyalty Programs

Editor's Note: This year we expanded our coverage of the technology companies that do the behind-the-scenes work of powering the technology systems of the world's major travel companies. We’re chatting with a handful of industry leaders for our new Travel Tech CEO Listening Series to discover where they think the industry is heading. In 1981, American Airlines created AAdvantage, the first mileage-based frequent-flyer program, a model that has been copied in a broad way by more than 160 airlines, hotel chains, rail companies, and other travel providers. Today, loyalty programs, particularly the credit-card programs that generate awards through spending, are contributing to the profits of many travel companies. A case in point: This spring, Qantas explained how its loyalty program is vital to its finances. More than a third of credit-card spending in Australia is on a Qantas co-branded card. There may be more mileage in the loyalty concept yet. Thirty-six years on, China, India, and other Asian Pacific countries are only now becoming enamored with frequent flyer and hotel loyalty programs, suggesting there are markets that remain largely untapped. Points International, a Toronto-based technology provider for travel loyalty programs, has tried to ride the wave. It does not run any airline's loyalty program. But it is the biggest miles and points reseller to consumers worldwide. Its Points.com website allows consumers to track points or miles from over 100 rewards programs, swap miles and loyalty points between programs, and buy miles and loyalty points to meet the thresholds required for all kinds of redemptions. Smaller companies such as AwardWallet.com and China-based MilesLife also offer points-aggregation tools. On the business services side, Points helps travel brands increase customer usage of their loyalty programs. In this, it partly competes with companies like Switchfly. Points, a public company trading on Nasdaq with a $141 million market cap, touts itself as having the bulk of the world's largest loyalty programs participating in some way or another, including all of the 10 largest airline programs and nine of the top 15 hotel programs in the world. But there may be less to that than meets the eye. The biggest knock against Points is that its business model may be too dependent on four loyalty program partners, who make up three-fourths of the company's total revenue. Points doesn't disclose the names