Every day, consumers are bombarded with marketing messages and loyalty program offers from hundreds of companies, making brand differentiation a real challenge. According to Deloitte research, consumers are exposed to 10,000 marketing and advertising messages daily. Standing out in this crowded landscape requires a more strategic approach.
While still important, traditional tactics like discounts and point-based rewards are no longer enough to capture lasting customer loyalty. A different Deloitte report reveals that consumers’ expectations have shifted, and “earn-and-burn” points systems alone are no longer adequate to meet those expectations. Instead, consumers want loyalty experiences that are more unique and personalized.
This is where the “inventory advantage” concept enters the frame. By incorporating a comprehensive travel and lifestyle portfolio within their loyalty programs, brands can offer a much more extensive range of rewards that cater to varied consumer interests. And this goes beyond just airline miles or discounts on specific products. It allows consumers to earn rewards toward experiences, from dream vacations to exclusive events and lifestyle perks. This creates a more holistic and engaging brand experience for consumers and drives long-term loyalty for the brand.
In this way, building a solid loyalty program hinges on a brand's ability to curate a compelling reward portfolio. By strategically partnering with the right travel and lifestyle providers, brands can offer a broader range of rewards. Understanding customer preferences and effectively integrating these rewards into the program requires expertise - and to effectively manage these partnerships and personalize rewards, brands may need to invest in loyalty technology solutions.
A diverse rewards inventory selection attracts a broader consumer audience with varying interests, making the program more enticing. At the same time, personalized experiences create stronger customer connections, increasing engagement and loyalty.
Why Consumers Will Engage More if Brands Add Travel and Lifestyle Rewards
Loyalty programs that carve out an inventory advantage by offering a variety of travel and lifestyle rewards are more attractive to members. A more comprehensive selection of inventory creates more choices for everyone, from travel enthusiasts to culinary fans to those who want exclusive experiences. This is an important point, as our research shows that 38% of loyalty program professionals say having too few travel options that appeal to and are valued by members is their program’s most pressing need – CALL OUT/BOLD IN RED.
When consumers can choose from various rewards that fit their interests, they gain flexibility in using their points. With smaller rewards being offered alongside bigger ones, there is a faster path to redemption, potentially accelerating earning cycles and motivating consumers to engage more frequently. This dynamic is illustrated by the fact that 75% of companies say lifestyle rewards represent 11%-30% of all redemptions. The enthusiasm generated from a more extensive selection of reward options, including travel and lifestyle benefits, creates a pattern among consumers for repeat engagement.
Travel and lifestyle perks can offer unforgettable experiences that forge deeper connections with the brand, making consumers feel more invested. They can also be tailored to individual preferences, broadening their appeal. This level of personalization elevates the value of the membership program beyond simple discounts.
Today’s consumers seek experiences, notably travel-related ones.
According to our report, 2024 Loyalty Trends: The Role of Travel Loyalty Programs in the New Value Economy, nearly half (49%) of consumers say saving money on travel is what they value most from their loyalty programs. Travel and lifestyle rewards are designed to meet those aspirations and desire for value.
By offering unique travel and lifestyle experiences, brands provide greater value to consumers who engage more because of the variety of rewards.
A Travel and Lifestyle Portfolio Extends Across Industries
The desire for personalized travel and lifestyle experiences transcends industries, meaning relevant rewards can resonate with diverse customer bases. A 2023 McKinsey survey notes that experiences, for any industry, are far more important in earning customer loyalty than earn-and-burn benefits.
For example, retailers can offer exclusive travel experiences for their best customers to create a sense of luxury and reward loyalty. By partnering with travel companies, retail brands can offer bundled rewards geared toward travel while promoting their core businesses. Companies can increase customer lifetime value (CLV) and brand differentiation when offering unique rewards. And by partnering with travel companies, retailers gain access to the expertise and resources needed to curate unique travel packages tailored to their customers.
Credit card rewards programs and banking and financial services brands can offer travel upgrades or airport lounge access because they add value to current offerings, making them more attractive. They can also provide travel insurance discounts to incentivize travel booking, as well as a variety of rewards that complement travel, like tours and activities. Our new analysis of major credit card rewards programs (The State of Loyalty: 2024 Credit Card Rewards report) finds that these brands consistently expand their portfolios to include more lifestyle rewards, providing an industry-wide example of the inventory advantage in action.
Similarly, telecom companies can offer travel vouchers or access to booking platforms to incentivize customers to choose their data plans or phone contracts. Travel and lifestyle perks serve as a bridge connecting core business offerings with a broader customer desire for experiences, increasing customer engagement and loyalty across industries.
By offering a comprehensive travel and lifestyle portfolio, brands can create a more engaging and rewarding customer experience. The inventory advantage isn’t just about travel; it's about connecting with consumers through unique experiences that resonate with their aspirations and desires. This creates a more holistic brand experience that deepens customer connections, so it’s an adaptable loyalty strategy across industries.
Unlock the Full Potential of Travel and Lifestyle Rewards
Launching a comprehensive travel and lifestyle rewards program unlocks a powerful way to captivate customers and drive loyalty. Modern loyalty platforms offer sophisticated analytics to understand a brand’s customer base and, by leveraging this data, those brands can personalize rewards, ensuring relevance and creating excitement.
Travel and lifestyle rewards cater to the growing consumer desire for experiences. A rich inventory, coupled with data-driven personalization, builds deeper connections with your brand, leading to increased customer retention. But technical expertise is critical. The right technology should integrate seamlessly with your existing loyalty platform, ensuring members can easily access and redeem rewards for travel and lifestyle experiences they genuinely desire.
Companies are increasingly using cutting-edge loyalty technology to build and manage their programs. By implementing a comprehensive travel and lifestyle rewards portfolio, you can create a program that elevates engagement, drives retention, and sets your brand apart. Embrace the opportunity to enhance your loyalty program with travel and lifestyle rewards and discover the full potential it holds.
