How to Partner with Frequent Flyer Programs
In today’s post we will be diving into the guiding points on how to partner with a frequent flyer program (FFP). Before we do that it is important to reiterate why it is beneficial for your brand to make this sort of partnership. Whether you already operate a loyalty program or not, partnering with a frequent flyer program can be a game-changer that boosts your customers’ engagement and your revenue, by:
- Increased Customer Loyalty: The appeal of being rewarded with miles for their purchases can incentivize your customers to return, fostering repeat business.
- Increased Customer Acquisition: Frequent travelers are more likely to purchase from and spend more at businesses that offer miles as a reward, as well as a payment option in their shops.
- Enhanced Brand Awareness: Aligning with a well-respected FFP can reinforce your brand’s image, forging a stronger bond with customers.
Preparation – What You Need to Know?
It is essential to be prepared before partnering with a frequent flyer program. Among other topics, the following two are the key considerations to take a decision:
- Onboarding Time: Ensure you are ready for the time commitment required to set up the partnership between your business and every FFP. To complete the commercial, legal, accounting and technical integration it can take up to 12 months.
- Minimum Volume: Although not all, some frequent flyer programs may require a certain minimum transaction or customer volume to be committed by your business when engaging in the partnership. Depending on the size of the FFP this can be in the highs of hundreds of thousands of dollars per year.
Timing – When to Make the Leap?
Timing can be everything in business. It is therefore important that you know if the time is now to partner with an FFP. There are two main aspects you can look at to understand if you are ready:
- Business Stage: The ideal stage to be in is when your business has established a solid customer base to build upon, as well as the technical set up where you can easily integrate the FFP into your systems and point of sales to directly reward your customers with miles without any manually efforts. Based on the research conducted in our Global Rewards Liquidity Report 2023, in general brands give 1-5% of their revenue back to their customers in form of miles.
- Your Current Loyalty Landscape: If you have a loyalty program in place, partnering with an FFP can expand your programs redemption options. If you don’t, it makes it easier to reward your customers by directly offering miles from an established FFP, instead of creating your own loyalty program.
Selection – Which Frequent Flyer Program?
To reach your target customers it is important that you apply an effective market coverage strategy. Here are a few pointers to help you with the segmentation and deciding whether one primary FFP is enough or if multiple partnerships make more sense to maximize your reach.
- Demographic Segmentation: Understand if the FFP you want to partner with caters to customers with the same or similar age, gender, income, education, and occupations as your customers.
- Geographic Segmentation: Are the frequent flyer program’s customers based in the same geographic location as yours, or do they often travel to the same region.
- Psychographic Segmentation: Is the frequent flyer program focused on premium customers or budget travelers, based on their personality, values, hobbies, interests, and lifestyle.
- Behavioral Segmentation: Based on your customers’ behaviors, such as purchasing history, frequency of purchase, and brand loyalty, would they be interested in earning miles from the FFP you want to partner with.
Measuring Success – Is it Worth the Effort?
Like every business decision, it is also crucial to measure the impact of a partnership with a frequent flyer program. Here are two ways to measure your success:
- Monetary ROI: Monitor the increase in success metrics such as: average purchase frequency, average purchase value, and the payment ratio of cash and miles per purchase
- Branding ROI: Besides the monetary indicators measured above, partnering with an FFP also enhances your brand awareness. To track your branding success monitor the data such as: online store / website visits, number of social media impressions, followers, and post engagement.
Incorporating a partnership with a frequent flyer program can provide a boost to your business by enhancing customer loyalty, acquisition, as well as your branding. Understanding the prerequisites, choosing the right program, and regularly measuring the outcomes, can help you tap into a strategy that has the potential to significantly elevate your brand and bottom line. Like many others have already figured it out, partnering with an FFP is the best next move for your business.
Not only can we help you choose the right frequent flyer program to partner with, we also make it easy for you to connect with them in just one click.
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