Rewarded for Your Loyalty to an Airline? It is Actually the Other Way Around
“N ext, after the flight is all over and I get my hard earned points, when we go to REALLY be rewarded for our loyalty to an airline, and go to spend our $kyRubles, just how appreciated do we feel at the end of the day?” asked René de Lambert in this article posted at Delta Points. “Can Delta just not care at all about the award program and just provide a good product and service and that is enough for everyone (or at least those who Delta cares about)?”
My answer is: not exactly.
The positions for both the vice president of customer loyalty and engagement and managing director of the SkyMiles global management program have recently been filled at Delta Air Lines. If the SkyMiles frequent flier loyalty program no longer had any significant relevance to Delta Air Lines, then there would really be no need to fill those positions; so it is safe to assume that Delta Air Lines still “cares” about SkyMiles — but likely does not put as much emphasis on it as it did in years past.
These days, it is apparently not about whether you should be rewarded for your loyalty and your “investment” in a frequent flier loyalty program; but rather whether you should reward the airline with your patronage in exchange for the airline offering a good product and service.
When times were tough for airlines, frequent flier loyalty programs were what helped to save the day for them — despite losing billions of dollars per quarter — and many frequent fliers chose their allegiance to airlines based on those programs. Safety was not a concern — commercial aviation is one of the safest modes of travel. Price was not necessarily a concern, as the airfares of routes on which airlines competed were basically matched. Service might have been a factor — if only because a customer would most likely rather be a passenger on a non-stop flight than connect at some airport, consuming an hour or two more in travel time, which meant choosing the airline which had the most frequent schedules of direct flights…
…but during those tough times, customer loyalty was important to airlines — sometimes to a fault. Some airlines occasionally “gave away the store” despite their hemorrhaging finances.
Airlines then tried to be everything to everybody at one time. Remember CALite, song and Ted, which were low-cost carriers launched by Continental Airlines, Delta Air Lines and United Airlines respectively? None of those ventures were deemed successful.
Today, airlines are differentiating themselves from competitors. Some offer better food. Others offer better service. Still others offer the lowest price. Frequent flier loyalty programs seem to be less and less of a differentiator today than they were years ago…
…and in the case of Delta Air Lines, a good product and a good service is offered. The ideal customer is one who appreciates a good product and good service; and is willing to frequently pay for it with little to no emphasis on SkyMiles, whose rewards would be considered an appreciated added benefit and not the result of grandiose expectations. Delta Air Lines has been betting on that; and by the looks of their quarterly reports and stock share price, it appears that they are winning the bet — at least, for the short term.
It is the long term which will reveal the true answer of whether or not tinkering with what was traditionally known as loyalty is the right call. All it will take is one downturn in the economy to put that to the test. Will Delta Air Lines be able to afford to offer the product and service customers currently enjoy during that eventual downturn in the economy; and if not, will customers still patronize Delta Air Lines — especially if they feel that their loyalty was “betrayed”? We will not know until that day comes…
…but in the meantime — although SkyMiles is still important to Delta Air Lines — the frequent flier loyalty program is currently not nearly a priority for Delta Air Lines as it had been in the past.
In other words, management at Delta Air Lines is apparently not as concerned about rewarding you for your loyalty as it is about you rewarding the airline with your patronage in return for offering a good product and service when compared to its competition…
Photograph ©2015 by Brian Cohen.