A new loyalty program from a handful of Silicon Valley veterans aims to use your phone’s location-based data patterns to deliver reward points. Called Miles, the new loyalty program awards points for a user’s full spectrum of travel modes, from walking to riding a bicycle to public transit to driving to flying on an airplane.

Users earn points in tiers; walking earns the most at 10 points/mile while flying on an airplane only earns 0.1points/mile. By tracking a user’s location and movement speed, the backend at Miles automatically determines what mode of transportation is being taken and then allocates points accordingly.

Reward points — or rather, the value earned from rewards points — won’t come out of thin air. With each mile traveled, Miles will use your phone’s location data to actively process and predict user trends to deliver specialized deals and incentives (i.e. rewards) to specific users. If the AI that Miles uses identifies that there are a lot of drivers in an area that may potentially need fuel, for example, it might work with Chevron to offer a $5 coupon off of a fuel purchase.

In this way way, Miles can provide a highly targeted product to specific companies or sponsors looking to deliver carefully curated incentives. And by taking a margin off of each transaction, Miles makes money by facilitating the relationship between traveler and marketer.

earning and spending miles

Users earn points through the Miles system based on both mode of transportation and economies of scale. Slower and shared transportation typically earns a higher volume of points/mile while air travel earns the least. Among the launch modes of transportation, users earn:

  • Walking/Running: 10 points/mile
  • Biking: 5 points/mile
  • Bus, train or boat: 3 points/mile
  • Carpool or rideshare: 2 points/mile
  • Car: 1 point/mile
  • Air: 0.1 points/mile

Most modes of transportation are automatically determined through the Miles AI, however in some cases it’s possible to manually select the mode of transit or submit corrections to the system for manual review. Car rides through Lyft or Uber, for example, can automatically be linked and flagged in the app.

After users earn points, they can automatically spend them through the app. Rewards range in scope from Amazon and Target gift cards to free car rental days or tanks of gas. According to Jigar Shah, the group’s CEO, Miles will launch with about 35 partners.

Key to the reward system is also the targeting provided by Miles, its AI and its partners. If Miles identifies you as a regular vehicle commuter in Fremont, California, for example, you might see more rewards for local gas stations, public transit (an incentive from the local municipality) or meal delivery service.

It also won’t be painfully easy to directly earn massive, tangible rewards or game the system. In a demo with Skift, Shah highlighted a $5 reward at Starbucks that might be good for a cup of coffee. That particular reward cost 2000 points – which would take 200 miles of walking to earn.

To be clear, other rewards are far easier to collect and Miles isn’t meant to be an actively micromanaged, aggressive tool for earning miles like an airline program might be. Instead, Shah stresses that Miles should be used as a background program to continuously earn points across weeks or months of travel.

It’s also possible to earn elite status through Miles – just like through a traditional airline or hotel loyalty program – which multiplies a user’s volume of earned points.

Geographic Launch Partners

Miles’ launch Tuesday comes along with a new website, an app, funding news and the announcement that it will be working with both the Contra Costa Transportation Authority (which spans much of San Francisco’s East Bay) and the Seattle Department of Transportation to build out a network of incentives and rewards.

In the Skift demo, Jigar Shah, the group’s CEO, showed how an everyday commuter working in San Jose, California might earn 240 miles each day by walking to her car, driving to the South Bay and walking into the office.

Contra Costa, along the way, might offer an extra point bonus for that commuter to take a shared car or public transit, both as a way to alleviate traffic and also as a way to advertise the virtues of local train infrastructure.

Shah sees local municipalities as excellent partners for Miles, as those groups have both an interest in tracking user behavior and a reason to incentivize different modes of transportation.

Privacy concerns

One potential drawback of constant location tracking and reporting is that some users may have concerns about releasing their data to third parties. To allay those concerns, Shah says that specific location data will only be seen by the Miles AI and that partners won’t have access to a specific user’s habits. Instead, partners will see an aggregate trend of user behavior in a select location, which will allow them to measure and deliver incentives en masse.

In the future, Shah also suggested that Miles would implement features to allow travelers to share their tracking data only over specific times, such as during a commute or a travel day. Users, too, can always simply log out of the app.

Whether Miles ultimately becomes successful may depend on how many users are willing to share their location data and whether the incentives for doing so end up being worth the effort. But initially, many may be attracted by the wide spectrum of partners, the relative ease of earning miles and and the app’s clean and thoughtful user interface.

Miles new app is available for iPhone as of this morning. An Android version, according to Shah, is due in the coming months.

Photo Credit: Screenshots of the new Miles app user interface