Below the Line

Airline loyalty: buy your perks

Airlines are starting to use the fact that they've cut passenger benefits to their advantage by using them strategically to drive customer behavior.

Delta sent out an e-mail today offering customers who sign up for the Delta Amex card their first checked bag for free. (To read the whole e-mail from Delta, scroll down to the bottom of this post.)

While it might be annoying to earn back this perk that customers once took for granted, for anyone considering flying Delta, there is clear value in accepting this offer. 

   

Note that this is not a win-back promotion; the offer is valid to first-time credit card customers only. Very clever, Delta.

United now lets customers buy some of the elite program benefits previously reserved for those who "earned" them by obtaining Premier status.

 

Now you can buy priority security access, Premier check-in line access, etc. Personally, I just wear my "I'm kind of a big deal" t-shirt and hope they'll recognize my celebrity status. 

 

Let's see if RyanAir can turn going to the toilet into a loyalty perk. I pity the creative team tasked with that one.

Starbucks rewards UK customers with money-off coupons

Last autumn, Starbucks heated up the UK coffee wars with free Wi-Fi. They've now started rewarding their UK customers through their loyalty program.

Coupon usage in the UK isn't as rampant as it is in the U.S., but it is on the rise as people look for ways to save money during the recession. The direct mail package includes a booklet which has a month's worth of coupons - each good for one day only. Surely by the time their customers use each coupon, they will have established a new daily ritual (not to mention a serious caffeine addiction).

Starbucks heats up coffee wars with free Wi-Fi in UK

Perhaps in response to recent marketing efforts by Costa Coffee, Starbucks is now offering free Wi-Fi to UK customers who have signed up for their Starbucks Reward loyalty program.

Reward customers already received little extras, such as soy milk or specialty syrup in their coffee at no extra charge. This move brings the UK loyalty program in line with the U.S. offering, which is a good strategy for a global brand.

Interestingly, most of Starbucks' competitors in the UK do not offer free Wi-Fi, whereas in the U.S. many do - and they don't require customers to sign up for a loyalty program in order to receive it. Surely, it won't be long before another UK chain comes along and offers it completely free.

However, Starbucks is able to use their dominant market position to ask their dedicated customer base to jump through one small hoop in order to receive the benefit. While Starbucks may lose some business to customers who just want to use Wi-Fi on occasion and do not want to sign up for Starbucks Rewards in order to do so, they will gain a wealth of customer data which, if used properly, should help them innovate to stay competitive in the future.

The e-mail announcing free Wi-Fi is below, along with a teaser e-mail sent a month prior.

American Airlines finally segments international Net SAAvers

American Airlines is finally segmenting their Net SAAver Fares to avoid sending international customers irrelevant e-mail.

(Click to enlarge.)

Although they have always had customer address details for their frequent flyer program members and thus the ability to send targeted e-mail, customers living outside the U.S. received fare offers not relevant to their point of departure.

Apparently, this is the latest in American's efforts to offer more personalized e-mail. A press release from American Airlines in January stated "Net SAAver e-mails now highlight destinations that are on sale from a customer's home airport or from a city that is close to their home, making it more relevant for the subscriber...Additionally, the new, personalized content includes special offers and other news that may be of interest to the customer."

It's good to see American is finally including international customers in their strategy. Shame about the appalling e-mail graphic, though.