the gamification of airline loyalty

by | Mar 11, 2020 | Airlines, News

by Jack Chen MARCH 3, 2020

This article originally appeared on Kambr Media – check out this link and more for the latest news on the intersection of commercial aviation and tech.

“’Yes,’ I tapped, I am ready to play! What do I have to do? Then came the cold splash of disappointment as I looked at the tasks I had to complete in the next six weeks to earn miles. I had to book three trips through my app each with a minimum distance and minimum dollar amount. That sucks,” writes Loud-Hailer CEO Jack Chen.

Editor’s Note: Welcome to the inaugural post of a new column titled Airline Tech Retailer by guest contributor Jack Chen. Upcoming topics in this column series include a look at airport concourse’s retailing strategies, as well as tech innovations in the airline industry and at airports.

“Would I like to play for more miles?” my airline mobile app asked me the other morning as I just passed the TSA checkpoint while walking to my gate.

Who doesn’t want more miles or get to board before others to get access to that highly desired overhead storage space?

Airlines were one of the first industries to incorporate gamification successfully in the form of frequent flyer miles. They offer a measurable reward system that was easy to understand (take more trips for longer distances at full value and earn trip or consumer goods).

Loyalty Game On – Or, Game Over?

Besides, I am always a fan of gamification of consumer behavior which, when done well, can drive customer brand loyalty, increase consumption and even build a sense of community among customers.

My airline app asked me at just the right time in my journey.

I hadn’t bought my coffee and breakfast yet, and had some time to kill before boarding. I was so, so ready for the rush of dopamine as I accumulate more miles that I don’t plan to spend, as I watch my miles balance grows and hopefully edge closer to boarding just behind the parents with children two years old and younger.

“Yes,” I tapped, I am ready to play! What do I have to do? Then came the cold splash of disappointment as I looked at the tasks I had to complete in the next six weeks to earn miles. I had to book three trips through my app each with a minimum distance and minimum dollar amount.

That sucks. I don’t know about most folks, but I have limited control over when and where I fly.

My airline should also know that I tend to book flights right before I fly, so asking me to book flights over a month in advance is like asking the impossible. “They know I can’t do this,” I thought. “They know this! Why would they design a game this way?” It was all just a tease.

Hate The Game

Standing at the gate, still bummed about the game while watching others board before me (they probably each bought six trips on their mobile apps!), I started thinking about how I would have designed the game differently.

My assumptions are that the game:

  • Is meant to increase revenue for the airline, thus as long as an action will increase airline revenue, it should be incentivized and gamified;
  • Should be accessible, in other words, give players (the consumers) the ability to participate at different spend levels;
  • Should entice the consumer to come back to it at different times, not just when they need to buy a plane ticket;
  • Incentivize desired behavior not usually observed, in other words get consumers to do something they do not normally do but that the airline would like them to do.
  • So here is how my airline game would have worked.
  • Offer lower value rewards for spending at the shops or restaurants in the terminal. This gives passengers lower threshold ways to participate in the game. Moreover, aside from earning money from selling plane tickets and ancillaries, airlines may also participate in revenue shares with the airport on non-airline revenues based on number of passengers the airline brings. Thus, getting passengers to spend a little money before boarding can help the bottom line.
  • Offer slightly more rewards for spending money at less frequented restaurants or shops. Sometimes the restaurant just around a blind corner has a much shorter waiting time than the first shop at the beginning of terminal. Why not encourage passengers to walk the extra 2 minutes?
  • Offer even slightly greater rewards for spending money at the arriving terminal. Airports make very little retail money from arriving passengers. An airport official told me once that if they could increase sales to arrivals by just 1% that it would be a game-changer. The airline knows my ultimate destination airport and any transfer airports, so why not entice me to spend money at each stop and make it convenient for me to do so?

I suspect, though, that the reason these rewards were not part of the game was not because of poor design but rather validation. Rewarding miles based on spending with a third-party vendor poses its challenges.

The validation of conversion by the airline can be quite difficult. Even if the airline had permission to install beacons everywhere in the terminal, it may still not be an efficient or scalable way of understanding where the passengers walked to buy their cup of coffee. Additionally, the airline has a challenge receiving proof that a purchase was made.

Incredibly, I still hear of some loyalty apps that ask users to take photos of their receipts and upload them to claim points.

Until better technological solutions become available, however, I will have to continue to sit out of these wonderful games my airline app invites me to play.

About our guest author, Jack Chen

Jack Chen is the CEO and Co-Founder of Loud-Hailer, which has a patented beacon-free technology platform specializing in hyperlocal engagement and services. He’s always thinking about the convergence of technology, airlines and retail — not just because it’s his job, but because he’s a frequent flyer.