Engaged customers – opportunity or risk?
22 August 2017
Compared to other industries, the travel industry has the advantage that many customers have a natural high level of engagement. This is, first of all, a tremendous opportunity for our industry. But at the same time a risk, too.
Not so long ago, I’ve found myself stranded in Istanbul, with the need to purchase a one-way ticket to get home to Toulouse. When searching for flights, I was happy to see Turkish Airlines popping up as cheapest option. It would have been my first choice anyway since spending a few hours in its lounge in Istanbul thanks to my Star Alliance Gold status is like a first taste of paradise. I might never be admitted to paradise, so it is good to take advantage of it while being on Earth.
As I was travelling with my wife, I was even happier to be able to share that experience with her and I’ve made arrangements that we arrived sufficiently ahead of time at the airport to benefit of it.
When arriving at the lounge, I’ve showed our boarding passes to the agent. Funnily enough, we were actually not on the direct flight to Toulouse, but had a connection through Brussels (where the lounge is pretty nice as well for European standards, at least if you are not in the temporary “lounge” they had there over the summer…).
When the agent looked at the boarding pass for TK 3715 to Brussels, he told me that we were not eligible to enter the lounge as this flight was operated by Brussels Airlines. But he told me that there was another small lounge at the lower level of the airport for Star Alliance flights we could use. I read in his face what level of lounge that would be…
But wait a second: Even if operated by Brussels Airlines (a fellow Star Alliance member) – something I was not aware of -, why shouldn’t we be admitted to a Turkish Airlines lounge? I was really looking forward so much to that experience that I’ve wanted to find the mistake. One small gate between us and paradise…
That’s when I woke up, 4am in the morning, in my bed at home. I was safe.
All this was just a dream. TK 3715 doesn’t exist, Brussels Airlines doesn’t fly to Istanbul and, of course, you can get into the Turkish Airlines lounge as Star Gold member.
It is probably the highest level of engagement you can hope for from a customer if he/she dreams about your company. At least, travellers tend to talk about their flights and hotel stays when meeting with friends on Saturday night. But would you ever talk about your experiences at your grocery store during the week? Something very exceptional would have needed to occur in order to make this happen.
This natural level of engagement is a great asset for our industry. It is not really our merit we can be proud of, but entirely due to the human-behaviour fact that people tend to like to travel.
But since these travellers are faced by bad news almost each day, including at the level of loyalty programs, this natural positive feeling is almost always sided by the fear that things could get worse. And by experience, we have learned that they ultimately would get worse.
Is it unthinkable that one day I would not be admitted to the Turkish Airlines lounge under some strange pretext? Unfortunately, no.
The more mistakes you make or even simple downgrades you put in place, the bigger the risk that an engaged customer turns, more or less furiously, away from you. Sometimes the line can be very thin whether a customer is full committed towards you or whether he avoids you at any price. While such behaviour might not always be rationale (we are talking about feelings at the end of the day!), many programs actually underestimate these potential risks.
What does Etihad exactly think when they suspend, as majority shareholder, the FFP of Air Berlin, undermining all its efforts to stay afloat? This will have repercussions well beyond the customers of Air Berlin. But even minor changes to terms and conditions of programs can have an unexpected outcome.
The main argument of loyalty managers when implementing changes is that the differences to the individual customer are small and that members don’t care. This might be true in theory. But they are wrong that they don’t care. They do care, maybe much more than you like.
Underestimating that aspect lets you quickly slip to the wrong side between the opportunities and risks resulting from the engagement of customers. This natural customer engagement in this industry should be viewed as huge opportunity and engaged customers should be handled with special care. However, many see such engagement today, unfortunately, much more as a burden, forcing them to activities such as monitoring user forums etc. All loyalty managers wishing that their members might be slightly less engaged (they would replace “engaged” by “demanding” in their terminology) are simply in the wrong industry and should consider using their knowledge in other industries such as retail, where all the theories about loyalty techniques apply much better in front of a less engaged customer basis.
Today, many loyalty program members are afraid of the next downgrade, letting them even have nightmares about it in extreme cases. It is an issue the industry needs to fix at a system level, not psychiatrists at the individual level.
