From Cost Center to Cash Generator: Air India Marketing Chief on New Loyalty Program

How do you turn a net negative into a positive? That’s the challenge faced by Air India’s Chief Marketing Officer, Sunil Suresh. 

He is proud that Flying Returns is the oldest airline loyalty program in India. But he also recognizes that under its former management, the scheme didn’t realize its full potential. 

This changed Wednesday when the airline revealed a huge overhaul of its frequent flier offering. 

Speaking to Skift before the relaunch, Suresh offered candid context around the changes.

“Over the years, [loyalty] had effectively become this little department that ‘needed to be done’, and therefore we were doing it. There was a small team running it very much like a cost center,” said the CMO.

Unsurprisingly, as a part of Air India’s five-year ‘Vihaan.ai’ transformation project, loyalty was identified as a key area of improvement. 

The brief to Suresh’s team was hugely ambitious. “It was to create a loyalty program that is benchmarked and that can compete with the best in the world. We want to take the airline to be one of the top carriers in the world - the loyalty program has to follow,” said the marketing chief.

There was also an appetite to turn the program from a cost to a value creator for the business. 

Better For Members; Better For Business

Suresh said the new program is focused on making processes easier, more rewarding, and with greater recognition for its members.

As the CMO himself admits, “miles-based programs were very complicated.” The result is the airline moving to a value-based system. This should make it simpler for members to work out how much they can earn. 

Suresh is also confident that it is now much easier to earn Gold or Platinum status compared to other major global carriers.

He explains: “The whole transformation is about offering travelers a world-class experience. That's what Vihaan is all about, whichever part of it you look at. Loyalty is very much contributing towards that world-class experience. If you're a frequent traveler, you expect the airline to recognize that fact and make your travel that much easier and rewarding. That's what this loyalty program is going to do.” 

Air India's Cheaper Rewards

Suresh highlights big reductions in redemption ticket rates for Air India flights - sometimes by up to 50% - as well as more redemption availability as key improvements. 

To make the program even more competitive, the airline has reviewed the best airlines in each of the regions it operates and has tried to more closely align its ‘earning and burning’ rates with them. 

To support the changes, the refreshed program has allowed more processes to be completed online for greater self-service. For elite members, there is also a time-saving priority contact center. 

The airline will also emphasize member recognition for its elite members as a part of the relaunch, something that was not a standard operating process in recent years.  

Air India Boosts Training

To help turn theory into practice, the airline has invested significant time and resources to retrain its staff.

These frontline employees deliver on the program benefits, both old and new. For instance, the carrier has launched ‘Fly Early’, a feature that allows certain elite members to take an earlier flight on a space-available basis once they are at the airport. Of course, this only works if staff know how to honor the new benefit. 

Suresh is also aware that the airline should not have too many elites nor too few - something of a fallacy at the old Air India.

“It's a balance that we need to strike. It's tempting to say let's have as many elite members as possible, but we're also cognizant of the fact that the delivery of the benefits needs to keep up. You need to have the capacity to be able to handle the volume.”

The marketing chief revealed that he is aiming for 4% of loyalty members to be at elite status. 

There’s More Work To Do

Despite Wednesday’s glitzy launch, the job is not done yet. “Our first focus was to land a great loyalty program for the airline, which is what we're doing right now with Flying Returns reimagined,” said Suresh.

The work on the transition to a group loyalty program is up next. The same system will ultimately award points and make redemptions available on group airlines such as Air India Express. 

Suresh recognizes that work has yet to begin on merging Vistara’s frequent flier platform. This is because the merger proceedings are still to receive the final blessing of Indian regulators. The CMO is hopeful that by the end of 2024, the program will work across both carriers. 

The airline's future ambitions are not small. For a program that had just three million members in March 2021, the targets are enormous. Suresh hopes that by the time Vihaan.ai concludes in September 2027, it will be 20 million-strong with an activity rate of 20% or more.

Click here to read our Skift analysis of the key changes to Air India's Flying Returns program.