back icon Back Insights 09/08/2023

From One-Time Shoppers to Lifelong Members: Unveiling the Customer Retention Benefits of a Travel Loyalty Program

Brand satisfaction and loyalty are key drivers of customer retention. However, there are major differences between satisfied customers and loyal ones—the primary being that loyal customers can drive a repeat business rate that’s 15 times higher than that of non-loyal customers. Not to mention, it’s up to seven times cheaper to retain loyal customers than to acquire new ones. 

Customer retention is paramount for sustainable business growth and success, but in today’s fiercely competitive environment, it’s no longer enough to satisfy your customers. It’s imperative to drive brand loyalty through solutions that boost customer engagement and foster long-term relationships that result in increased repeat business and customer advocacy.

Over the past several decades, travel loyalty programs have emerged as promising solutions to convert satisfied customers into steadfast supporters. From exclusive rewards to unprecedented experiences, discover how travel loyalty programs provide organizations with customer retention benefits that serve as catalysts in turning one-time shoppers into dedicated, lifelong members.

The Evolution of Customer Retention through Travel Loyalty Programs

Courtesy of brands like American Airlines and Marriott, travel loyalty programs have been industry staples since the early 1980s. The first iterations of these programs focused solely on transactional customer retention benefits, like increased travel spending. In recent years, however, these programs have emerged as promising tools to build meaningful customer relationships. 

In an era when customer retention is pivotal for sustainable growth, travel loyalty programs offer a strategic avenue to drive long-term connections. By providing customers with enticing rewards, exclusive experiences, and personalized benefits, businesses can transform initial transactions into ongoing engagement and advocacy. After all, the results of these programs speak for themselves. 

  • 66% of customers are more likely to continue doing business with a brand because of a loyalty program.
  • 73% of customers are more likely to recommend brands with good loyalty programs to friends and family.
  • 79% of customers will increase their brand spending to maximize the available loyalty benefits.

Unlike other customer retention strategies, which strictly incentivize repeat purchases, travel loyalty programs build long-lasting customer relationships through shared travel experiences. The customer retention benefits of travel loyalty programs help to enhance brand affinity, foster a sense of community among members, and, of course, increase customer lifetime value (CLV). 

Creating Lasting Emotional Connections with Customers

Now more than ever, customers expect to be treated like actual humans, not assets—a sentiment that rings true across all verticals. Gone are the days when marketing your business could focus solely on transactional elements, like cost savings. Instead, 90% of consumers are seeking authentic relationships with brands, something that requires a long-lasting emotional connection.

Travel rewards are proven customer retention strategies to create deeper consumer bonds that transcend traditional transactional relationships. Travel loyalty programs facilitate lasting emotional memories that forge deep-rooted connections between customers and the brands that powered the unique travel experiences they may not have been able to access otherwise.

Likewise, travel loyalty programs enable brands to personalize and customize offerings based on individual customer preferences and behaviors. A more personalized approach enhances the customer relationship and increases the likelihood of repeat business. In fact, personalization in travel rewards encourages a 5.2x lift in brand loyalty and a 3.5x lift in average brand spending. 

Elevating Customer Engagement and Advocacy

While it’s brand loyalty that drives customer retention, it’s customer engagement that powers ongoing brand loyalty. Fortunately, the consumer appeal of travel loyalty programs can help to enhance customer engagement as well. Factors like brand alignment, customer recognition and support, and personal relevance of travel rewards are all proven to elevate engagement

Even more, travel loyalty programs are a means to provide high-value customers with exclusive benefits and rewards access, thereby increasing brand interactions. Exclusive perks—such as priority booking, room upgrades, and VIP treatment—create a sense of value and recognition that encourages ongoing engagement. These benefits also transform customers into brand advocates.

It’s helpful to think of satisfied, loyal customers as mouthpieces for your brand. They’re statistically more likely to spread awareness of your loyalty program through word-of-mouth recommendations and online reviews. Positive experiences encourage one-time buyers to become powerful brand advocates, who, in turn, attract new customers and expand your customer base. 

Measuring the ROI of Travel Loyalty Programs on Customer Retention

Like any business metric, it’s vital to measure the return on investment (ROI) of travel loyalty programs on your customer retention rate. Explore various customer retention metrics and key performance indicators (KPIs) to measure the impact of travel loyalty programs, such as customer lifetime value, repeat purchase rate, referral rate, and overall member engagement.

To get a better sense of the customer retention benefits of travel loyalty programs, consider the recent success of’s Genius loyalty program. Last year, the online travel agency (OTA) re-doubled its investment in Genius by adding a new tier that unlocked up to 20% discounts for frequently repeating customers, driving up’s CLV and repeat purchase rate.

As per the company’s Q4 2022 Earnings Call, the revamp of the Genius travel loyalty program enabled bookings made directly through the platform to reach the highest level ever. Q4 gross bookings increased a staggering 32%, and by January, the company reached its highest monthly amount of hotel bookings. There was also a 29% increase in total accommodation costs. 

A woman sitting in a hotel lobby while on vacation booked using her customer retention benefits.

Overcoming Challenges and Maximizing Success

Despite the clear customer retention benefits of travel loyalty programs, there are a handful of potential challenges businesses may encounter when implementing similar strategies. These challenges primarily center around program fatigue and member disengagement, as well as competition from other loyalty programs. Let’s touch on program fatigue first.

The average shopper belongs to 16.6 loyalty programs—but actively uses less than half. Chances are, your customers belong to their fair share of loyalty programs, too. It’s essential to re-excite (and re-engage) the members of your loyalty program through ongoing communication, such as newsletters centering on available travel benefits and in-app alerts for upcoming rewards.

But what about competition from other loyalty programs? That’s pretty high: Expedia alone boasts an aggregated base of 154 million members and now offers One Key, a loyalty program that connects loyalty points across, Travelocity, and Vrbo. Be sure to continuously collect member feedback about your program to power improvements that solidify your brand loyalty.

Arrivia: Your Partner in Boosting Customer Retention through Travel Loyalty Programs

If customer retention is your goal, travel loyalty programs can help get you there—and arrivia is your conduit to an effective program. As a strategic partner for organizations seeking a reliable white label travel product, arrivia’s suite of customizable solutions includes data analytics, member engagement platforms, and strategic consulting that power profitable travel loyalty programs. 

To learn more about how arrivia can help your business boost customer retention through innovative travel loyalty programs, visit our website or contact us today. Together, let’s embark on a journey to transform one-time shoppers into devoted, lifelong members who advocate for your brand and contribute to your business’s lasting success. Request a demo today to get started!