Skift Take

Amid fierce competition, loyalty programs have transitioned from a mere perk to a pivotal component of a brand's strategy to foster customer allegiance and encourage repeat business. Customization is key to successfully introducing travel solutions and sustaining loyalty over time.

This sponsored content was created in collaboration with a Skift partner.

Many brands recognize the importance of loyalty programs and capitalize on them to build customer preference and grow revenue. For example, loyalty programs have proven to be of immense value within the airline sector. Skift Research notes that for seven out of 10 of the largest airline loyalty programs, 70 percent or more of the overall ancillary business of the airline comes from loyalty revenues. 

However, with travelers overwhelmed by so many options, brands must innovate beyond conventional loyalty schemes to win a share of mind and wallet.

“Post-pandemic, there’s been a shift toward leisure travel rather than business travel, and loyalty programs have had to adjust to these new norms,” said Sarah Moore, SVP at Rocket Travel by Agoda, a technology company that partners with brands across various sectors to create custom travel booking solutions. “Many programs are focusing on flexibility, like making bookings made by points fully refundable, and providing unique experiences to keep customers engaged and excited. In addition, some brands are expanding their loyalty programs to include non-travel-related spending. For example, with co-branded credit cards, airlines are able to deepen customer engagement and incentivize higher status through a variety of channels, including hotel bookings, car rentals, and other travel services.” 

This shift raises an important question for brands: After launching a loyalty program, how can they continue to build and sustain customer preference? According to Moore, this requires a high degree of customization based on personalization, flexibility, localization, extensive inventory sources, and a strong strategic travel tech partner.

Personalize the Booking Experience

Engaging high-value customers to foster long-term loyalty starts by creating a more seamless and satisfying customer experience built on advanced personalization capabilities. A report from McKinsey & Company noted 71 percent of consumers expect companies to deliver personalized interactions, and 76 percent get frustrated when this doesn’t happen.

“By utilizing machine learning and becoming adept at data mining we can segment identify the best customers and understand their preferences,” Moore said. “This involves utilizing single sign-on to share customer characteristics, knowing past search behaviors, and sharing data to enhance personalization.”

Equipped with the right set of insights, companies can present tailored offers to their most valuable customers. Do they value discounts and special promotions? Do they look for ways to maximize points? By segmenting audiences based on their previous engagement and purchase history, companies can cater to these preferences, strengthen customer loyalty, and foster deeper connections. 

“Hone in on what matters most to them and curate their travel booking experience with relevant offers,” Moore said. “These offers might involve different tiering for various customer levels or distinct types of loyalty rewards, such as points, miles, cash back, or discounts. For example, some customers prefer recognition and premium service, like consistently being offered four or five-star properties, while others just want a discount or to be rewarded with a cashback offer.” 

Localization is another way to tailor the booking experience. By showcasing flexibility and localization across multiple verticals, Rocket Travel by Agoda enhances the overall travel experience for its partners’ customers. In this context, localization refers to the adaptation of services, content, and experiences to meet the specific cultural, linguistic, and practical needs of different regional markets, like utilizing different communications platforms (i.e. Whatsapp in APAC) and login experiences that better fit a specific user base. 

“For some of our partners, localization matters only within their specific geographic footprint,” Moore said. “However, for our global partners, we adopt diverse approaches to localization tailored to each partnership. This includes payment options customized to specific reward programs and local currencies as well as incorporating localized search filters and the ability to search by map. We support over 30 languages and numerous currencies, eliminating international interchange fees and enhancing user convenience because we can leverage our affiliation with Booking Holdings, which provides substantial breadth in these areas.” 

Prioritize Flexibility to Make Travel Easier

Pandemic-era lockdowns, travel restrictions, and border protocols fueled widespread uncertainty about air travel, pushing the need for flexibility throughout travel systems, including supply chains. 

Today, travelers expect the same level of flexibility. According to a survey, 69 percent of respondents said they prefer to travel with loose plans so they can react to opportunities. 

While many airlines have eased or eliminated change fees, making it easier to modify flights, others offer greater flexibility depending on the fare type and the customer’s loyalty status. Flexible cancellation policies have also become common within the hospitality sector. 

“We’ve emphasized clear communication with our customers through our platform, ensuring they understand their options and the level of flexibility available to them, including making offers refundable,” Moore said. “Additionally, we aim to consolidate travel information in one place for easy navigation. This means integrating flight and hotel bookings into a single connected trip.”

Maximize Inventory to Expand Choice

Today’s brands must also ensure they have a wide array of travel reward options to cater to every type of traveler. By maximizing their inventory, companies can offer a diverse range of options — from luxury hotels, bed and breakfasts and budget accommodations to car rentals and unique local experiences. This variety not only attracts a broader audience but also allows companies to tailor rewards and packages to individual traveler profiles, enhancing their overall experience. 

“One of the biggest advantages we have as the B2B arm of Agoda, and more broadly, as part of the largest travel company in the world, is our agnostic approach to inventory sources,” Moore said. “We don’t mind if our inventory comes from, Agoda, Priceline, or other partners. Our primary goal is to serve each partner effectively, leveraging our extensive range of options to match their individual strategic needs.” 

This broad range of offerings can be tailored to different regions and customer needs. For example, in China, Rocket Travel by Agoda focuses on API-enabled business-to-business partnerships designed to meet the market’s specific demands. In other parts of the world,  they emphasize white-label solutions — a customized loyalty platform that provides flexibility and a way to earn or redeem rewards to travelers.

“We proactively engage with diverse partners, including airlines, financial institutions, and e-commerce platforms, to expand our reach and categories,” Moore said. 

Stay Ahead With the Right Travel Tech Partner

Collaborating with a white-label partner can be a game-changer for brands looking to keep their loyalty platforms updated and optimized. The right partner brings a wealth of expertise and resources, enabling seamless updates based on current booking trends and user needs. They can also provide access to cutting-edge technology and industry best practices such as A/B testing, ensuring that the platform stays ahead of the curve.

“The combined power of Rocket Travel by Agoda’s white-label services and the reach and access of the Booking Holdings family of brands has effectively merged the best of two worlds into a single entity,” Moore said. “On one side, we have deep expertise in white-label solutions and loyalty programs. On the other side, we have strong capabilities in technology localization and globalization. Combining these strengths allows us to operate with significant expertise on a local level, with global reach and scalability.”

For more information about Rocket Travel by Agoda, click here.

This content was created collaboratively by Rocket Travel by Agoda and Skift’s branded content studio, SkiftX.

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Tags: airlines, localization, loyalty program, Rocket Travel by Agoda, SkiftX Creative Studio, SkiftX Highlights, SkiftX Showcase: OTAs, SkiftX Showcase: Technology, travel booking

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