Loyalty Doesn’t Fly
By John Hennessy
United Airlines recently launched Mileage Plus Auctions, a new program that lets members of its Mileage Plus frequent flyer program use their miles to bid on big-ticket items, such as private golf lessons, spa treatments, a flight simulator experience and a four-day U.S. Winter Olympic experience.
“We were looking for a creative [outlet] to give our consumers others ways they can use their frequent flyer miles,” said United Airlines spokesperson Robin Urbanski. “A lot of our customers were asking us to use their miles for things other than air travel. What is so creative about this [program] is a lot of things on the auction are things money can’t buy.”
Through the program, United Airlines wants to reward loyal consumers with once-in-a lifetime experiences or treasures, Urbanski said. Members can bid on items in a variety of categories, including action and adventure, gourmet, sports and rest and relaxation. The auctions offer big-ticket items, including 2005 Chrysler Crossfires, which two Mileage Plus members bid on and redeemed separately for 1.4 million miles and 1.45 million miles, respectively.
The program marks a growing trend by airlines to offer programs in which frequent flyers can redeem points or miles for items beyond air travel. United Airlines also lets its frequent flyers redeem miles for hotel stays, car rentals, music downloads, and newspaper and magazine subscriptions.
“Fares are so cheap now, people are more reluctant to use their miles to travel,” Urbanski said. “They want to keep their miles for other things. We really focus on giving our customers more ways to use their miles so their miles are more useful.”
Moderator’s Comment: What are other innovative ways companies are making sure members of their loyalty program continue to receive value?
Lots of members with lots of earned credits are reluctant to use them as originally intended.
Some companies would view not having redemptions as a boon. That kind of short-term thinking would devalue participation in the program for members and
result in a gradual realignment of loyalties.
Rather than accept its fate and let the value of their Mileage Plus program slide, United recognized that miles unredeemed would hurt the program and took
steps to make sure members have ways to realize value. –
John Hennessy – Moderator