The landscape of travel planning has undergone a dramatic transformation. Gone are the days when holiday choices were limited to glossy brochures or pre-packaged deals from a local travel agent. Today’s travellers are tech-savvy, wielding smartphones and a sophisticated arsenal of apps, credit cards, reward schemes, and price comparison tools to craft their perfect getaway. Emerging research indicates that loyalty programmes are now an integral part of this strategic approach, not necessarily as the sole driver, but as a valuable component.
A comprehensive, multi-stage consumer study conducted by market research firm Phocuswright has shed light on these evolving travel habits. The findings reveal that a substantial 84 per cent of leisure travellers actively engaged in some form of “loyalty gaming” over the past year. This practice involves strategically utilising various programmes to maximise the rewards they accrue.
Shifting Loyalties: Beyond the Single Brand
The Phocuswright research points towards a significant shift in how travellers interact with loyalty programmes across the board – encompassing airlines, hotels, and online booking platforms. The traditional notion of steadfast brand allegiance appears to be on the wane. Instead, loyalty benefits are increasingly being weighed alongside crucial factors like price, convenience, and availability when travellers make their booking decisions.
This pragmatic approach is further evidenced by the study’s findings on traveller behaviour. Between 57 and 68 per cent of respondents who identified a preferred airline, hotel, or online travel agency admitted to booking with an alternative provider within the preceding year. The primary motivations for these diversions were typically better pricing or more favourable scheduling options.
Madeline List, manager of research and special projects at Phocuswright, commented on this trend, noting that the discussion around loyalty in travel often becomes overly focused on accumulating points and miles. She suggests this narrow perspective overlooks the broader picture of traveller priorities. While travellers may be highly engaged with loyalty programmes, this engagement alone does not automatically translate into true loyalty, according to List.
Instead, the research highlights that for the majority, value for money, fair pricing, reliability, and ease of use take precedence over loyalty benefits when selecting a brand.
The Rise of Credit Card Rewards
The influence of credit card rewards programmes on how travellers earn and utilise points is also a notable trend. The Phocuswright study revealed that a significant 39 per cent of travellers charged gift cards to their credit cards specifically to accumulate points for future use. Furthermore, 27 per cent of respondents admitted to opening credit cards with the intention of reducing their spending or closing the account shortly after receiving a welcome bonus. An additional 16 per cent reported making purchases on behalf of others as a means to generate rewards.
Adding further weight to this observation, a separate survey conducted this year by Skift Research, a division of the US-based travel industry news group Skift, found that many American travellers now perceive credit card rewards as more valuable than traditional airline or hotel loyalty programmes.
While similar credit card-linked programmes exist in Europe, they generally offer less generous benefits compared to their US counterparts. This disparity is largely attributed to European Union caps on interchange fees, which consequently limit the funding available for substantial bonuses and high earn rates.
Strategic Use of Rewards in Travel Decisions
Points and miles are not just an afterthought; they are increasingly becoming a deciding factor in both the timing and destination of travel. Phocuswright’s research indicates that half of the travellers who redeemed points or miles for a recent leisure trip were visiting a new destination. This suggests that rewards are enabling exploration and encouraging travellers to venture to places they might not have otherwise considered.
The study also uncovered distinct generational differences in how rewards are perceived and utilised. Roughly half of Gen Z and Millennial travellers indicated that variety held more importance than consistently choosing the same brand. This implies that switching between different airlines, hotels, or booking platforms can be a deliberate and strategic choice, rather than an outcome of dissatisfaction with a particular provider.
List reiterates her earlier point, stating that true loyalty is not merely a product of interacting with a programme; it is the cumulative effect of all brand interactions throughout a customer’s lifetime. She concludes that while points and perks can certainly bolster an existing relationship, they are insufficient on their own to drive meaningful behavioural change. Without strong product quality, fair pricing, and consistently positive experiences, expecting a loyalty programme to be the sole driver of customer retention is unrealistic.
