There’s a reason why every successful travel business boasts a loyalty rewards program, and it’s not just increasing customer loyalty. From hotel loyalty programs like Marriott Bonvoy to airline rewards programs like Delta SkyMiles and even travel agency programs like Expedia Rewards, business owners implement loyalty rewards programs to grow their traveler wallet share.
Unlike market share, which refers to the portion of a market controlled by a specific brand, traveler wallet share (or share of traveler wallet) refers to the percentage of a customer’s total spending on a particular product.
In this article, you’ll learn how to increase traveler wallet share among your customers to drive retention, repeat bookings, and revenue growth.
Consider these strategies to increase traveler wallet share with a robust loyalty rewards program.
Types of Loyalty Rewards Programs to Improve Share of Traveler Wallet
Loyalty rewards programs have become a mainstay in the travel industry to attract potential buyers, retain existing customers, and incentivize travelers to make repeat bookings. As the name suggests, travel loyalty rewards programs are structured programs offered by travel brands, such as hotels, airlines, and car rental companies, to provide benefits in exchange for increasing customer loyalty.
Loyalty programs typically award a customer purchase with a travel-related perk, contributing to revenue growth and increasing the share of the traveler wallet. Aside from industry-specific loyalty programs, such as hotel programs, airline programs, car rental programs, and travel agency programs, popular loyalty rewards programs in the travel industry include:
- Points-based programs, in which travelers earn points on travel activities to be redeemed for future travel-related rewards or perks.
- Tier-based programs, in which travelers must continue to spend money to progress through tiers and unlock exclusive rewards.
- Co-branded credit card programs, in which travelers earn travel rewards from partner brands through applicable credit card spending.
Key Elements of a Successful Loyalty Rewards Program
When appropriately structured, a loyalty rewards program can benefit travelers and their customer experience just as much as travel brands and their traveler wallet share. A clear and straightforward rewards structure is the first element of a successful loyalty rewards program. In addition, the program’s earnings and redemption rules must be easy to understand and locate on the brand’s website.
Similarly, a loyalty rewards program must boast a seamless user experience to incentivize customers to make repeat bookings. User-friendly interfaces, mobile apps, and booking integrations are all vital elements in a successful program. Similarly, the program must feature regular updates, frequent promotions, and ongoing customer communication to keep travelers engaged.
Speaking of engagement, a loyalty rewards program must also leverage its accumulated insights into traveler preferences, behaviors, and spending patterns to personalize benefits. Personalized perks and product offerings can further increase the share of traveler wallet, especially when paired with the exclusive benefits and experiences integral to a successful rewards program.
7 Strategies to Increase Traveler Wallet Share with Loyalty Rewards Programs
In the highly competitive travel industry, loyalty rewards programs are a valuable tool for travel businesses to differentiate themselves from competitors. While loyalty rewards programs are fundamental to increasing customer retention, a collection of best practices is necessary to encourage repeat bookings that effectively increase a brand’s traveler wallet share.
Consider these seven top tips to increase wallet share with a travel loyalty rewards program:
- Promote enrollment and participation. Highlight the benefits of your loyalty programs during the booking process, at check-in, and throughout the traveler’s journey.
- Offer compelling rewards. Provide attractive rewards that are valuable and relevant to your target audience, such as free nights, flight upgrades, or exclusive discounts.
- Foster emotional connections. Enhance customer loyalty by recognizing recurring travelers, providing personalized greetings, and creating memorable experiences.
- Utilize data and analytics. Leverage machine learning to analyze traveler preferences, behaviors, and spending patterns and personalize product recommendations.
- Engage through gamification. Encourage active participation in your program with gamification elements, such as challenges, competitions, and leaderboards.
- Encourage repeat bookings. Provide incentives for repeat bookings and referrals, including but not limited to bonus points, unique discounts, or exclusive perks.
- Collaborate with partners. Forge strategic partnerships with travel businesses to offer cross-promotions and joint rewards for increased traveler wallet share.
Best Practices for Implementing an Effective Loyalty Program
Once geared with tips to increase wallet share with a travel loyalty rewards program, you might wonder how travel businesses can implement effective loyalty rewards programs. Are there any best practices for managing loyalty rewards programs in the travel industry? The answer is yes — beginning with defined program goals and objectives and clear program guidelines and rules.
Likewise, investing in technology and infrastructure to support a rewards loyalty program is always wise, especially in the first few months. For instance, a white label travel solution can enhance your customer experience without requiring you to build a new travel platform. Remember to adjust based on user feedback and performance metrics as your program gains traction.
Boost Traveler Share of Wallet with Arrivia
Travel-related perks are in demand in a big way. International tourism skyrocketed by 182% in the first three months of 2022 alone, with no signs of slowing soon. If you want a more significant piece of the traveler wallet share, adopt a travel loyalty program. With exclusive perks and compelling rewards, a loyalty program can drive revenue that increases your share of traveler wallet.
Travel loyalty rewards are a valuable tool to drive customer retention, increase repeat bookings, and allocate more consumer spending to your brand. For assistance in implementing a travel loyalty program to increase traveler wallet share, contact arrivia to request a demo.