From the early 1970s through the early 2000s, there were as many as 10 major U.S. airlines. In the wake of bankruptcies and mergers ─ most recently the merger of American Airlines and US Airways ─ four carriers currently control about 85% of the domestic market.
JetBlue Airways has moved in and become the largest carrier at Boston’s Logan Airport and at New York’s JFK Airport. The low-cost airline is sitting in a seemingly advantageous spot to capture new customers.
David Canty, Director, Loyalty and Partnership Marketing, at JetBlue Airways, participated in a compelling interview with Loyalty360 and discussed several issues, including how airline consolidation might impact the carrier’s future.
Airline Consolidation
Canty: With our TrueBlue loyalty program in general, consolidation is an opportunity for us. You try and respond as best you can to customers and customer expectations have changed over time. JetBlue introduced new benefits to the TrueBlue program in the second half of 2013, specifically no expiration of points, family pooling, and TrueBlue badges, which is pretty unique in U.S. airspace. We’ve seen significant results that lead us to believe that our customers are really pleased with what we’re doing and how we’re doing it.
It’s enabling us to connect with customers of other airlines who might not be getting what they need out of their existing airline program and they’re keeping an eye on what JetBlue has to offer.
We’ve tip-toed our way; if you’re an elite member at another airline, we’ll try and match them, but we also expect some level of return. We’ve done that based on anecdotal feedback and having customers ask if we would be open to matching their status at another airline. We haven’t necessarily gone out and bought a list and tactically marketed to them. I do think that’s an opportunity at some point, but you have to be careful about how you approach that.
TrueBlue Badges
Canty: A TrueBlue Badge is a personalized experience where users can earn recognition and rewards for a number of JetBlue-related activities – flying, interacting with partners, and getting social on Facebook and Twitter. Based on activity, you will build a personalized and interactive map that you can share with your friends and family.
With TrueBlue Badges, you can keep track of all your activities and accomplishments, even milestones like birthdays or qualification to Mosaic. Some badges will even award you with bonus TrueBlue points.
Since TrueBlue Badges launched, we are seeing significant engagement and sharing in the first three months. We’ve seen more than 1 million impressions on the social side as well as changed behavior.
Customers are buying ancillaries just to earn the badge. It’s extraordinary to see that happen, it’s an added benefit, we wanted to engage people and bring an element of fun to the program. I’m seeing some of our customers set up their own Facebook pages and invite friends so they can get to next level of TrueBlue badges. It’s a pretty powerful validation of what we’re doing.
When we get 12-months of data, we can mine that data and work with our partners to get relevant offers to specific customers based on their behavior. It’s one of the really cool opportunities we’ll see in 2014.
Engaging Customers
Canty: It’s very important to remember that when answering a question for a customer directly or through social channels about service, your program, an offering, or a promotion, you’ve always got to recognize that you’re not answering to just one person; you’re answering to a very wide audience. When I respond to one person’s Tweet, I’ve got to be transparent and realize the audience that actually sees that is much greater than the one individual that I’m answering, and there’s a lot of power in that.
Voice of the Customer
Canty: JetBlue has an entire department dedicated to Voice of the Customer monitoring through all social channels, the company website, email and phone.
We have a whole group monitoring that on a real-time level. From a leadership perspective, we share and discuss the results on a weekly basis. It’s something we absolutely try and keep our finger on the pulse of, our customer’s sentiment.
Family Pooling
Canty: Customers have been telling us they wanted to pool family points. Family members traveling three times a year may all have disparate accounts. When you allow them to pool the points which have accumulated in each, the next trip for one of them could be a free trip.
We’re saving our customers money by doing that. We’re focusing on TrueBlue being redemption friendly. We want customers to find value and to redeem their points. That’s the most important part of the program. Of course we also have to be responsible and ensure we maintain the financial integrity of the program.
General Fatigue in Airline Loyalty Programs
Canty: There is an element of fatigue in the general airline programs that are out there, and there has been for some time. People are feeling completely disenfranchised at the mid and lower levels, and that’s an opportunity for JetBlue. We’ve always positioned TrueBlue as a loyalty program more so than a frequent flier program.
We took a big gamble with the paradigm when we went down the path of changing our program, but the key was to take customer feedback and make adjustments.
Moving forward, I think airline loyalty programs will have some element of hybrid with many of them transitioning to a revenue-based model. I’m happy we have a revenue-based model. I’ve seen a lot of programs in the past three to six months devalue their return. We haven’t had to do that.
I think we’re fulfilling on our promise.
About the Author: Mark Johnson
Mark is CEO & CMO of Loyalty 360. He has significant experience in selling, designing and administering prepaid, loyalty/CRM programs, as well as data-driven marketing communication programs.