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Travel rewards vs. loyalty

  • phocuswright.com
  • 9 November 2023
  • 1 minute read
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This article was written by Phocuswright. Click here to read the original article

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With greater emphasis on the travel experience and with clear evidence that poor service delivery impacts loyalty, operational technology that reduces friction and resolves issues at each touchpoint is essential to drive true loyalty. For a recent analysis of operational technology in the hotel space, see Real-Time Revolution in Hotel Operations.

The loyalty landscape will be progressively more crowded with travel suppliers, intermediaries, payment processors and technology platforms – all eagerly vying for the attention of a tech-savvy traveling public. Amid this environment, artificial intelligence (AI) raises the stakes. SSI-informed, AI-powered agents will seamlessly identify eligibility for discounts, offers and rewards across a full spectrum of travel sellers. A basic tenet of current loyalty programs is consumer choice. But these AI-agents will likely curate options and surface recommendations based on both explicit and inferred customer preferences. 

There will inevitably be a tension between AI-bots deployed by travel sellers and those representing the interests of travelers themselves. The former will use traveler profile data, dynamic pricing and value-add offers to increase conversion and margins, while the latter will seek the best experiences at the lowest available price that create the greatest personal value. 

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