Airlines Bank on Inattentiveness to Frequent Flier Programs

Be honest – when was the last time you did your bank statement? Counted up calories for the day? Put your grocery store coupons in order?

We are a nation of thinkers and do-ers, yes, but we live in a state of automation. New technologies and new media have made it possible for minutae to be taken off our plates.

So when a new study was released that showed nearly one-third of consumers can’t identify their tier status in their favorite loyalty rewards program, it shocked me.

Shocked me in the sense that it wasn’t higher than one-third.

And, frankly, when it comes to airline loyalty programs it’s just another way for the airlines to make money – off our own inefficiencies and inattentiveness, something they most assuredly count on.

The study, conducted by publishing, education and research firm Colloquy, not only found that nearly a third can’t identify their status in a loyalty program, 42 percent never get past the lowest tier.

Think of it this way, in a very crude and unscientific comparison. When people plan weddings the general rule of thumb is to figure that 20 percent of the total number of invited guests will not be able to attend. That’s what they count on, that X number of people simply won’t take the time to care for their participation in loyalty programs. Colloquy’s study also showed that the ‘gold-silver-bronze’ set-up is woefully outdated.

Of course it is. That helps lead to the confusion and the general lack of awareness.

“Savvy shoppers and travelers are all too aware of the recent onslaught of changes to rewards programs,” study author and COLLOQUY Research Director Jeff Berry said. “Brands want to revive consumer engagement simply by updating rewards, but that exacerbates confusion about tier levels and can impose so many limitations that upward movement is perceived as unattainable.”

And it’s not just airlines. Many brands successfully bank on this hypothesis. Marketers already know what the study also found, that consumers with incomes below $50,000 a year are more than 50% less likely than those with incomes above $100,000 to make it to the high tier of a program. They don’t feel like the incentive is there.

Sure, airlines and other companies are compelled to reward their loyalty program members, but that’s more than offset by those who don’t tend to their memberships.

It’s all on the consumer, really. There has to be a level of interest there; a caretaker’s mentality. Because I can guarantee you this (in another crude comparison): if you were out for the night with friends and you bought four or five beers (or rounds) and tipped the bartender each time, wouldn’t you expect a buy-back at some point? That’s loyalty for you.