I don’t think anyone would ever propose that it’s a free-for-all for status. I think it’s a very measured and data-driven approach to how you  better use status to drive the desired behaviors you want out of customers, and structure it in a way that it is meaningful and beneficial to the customer, but still profitable for the airline.

Hey there, Points People. You just heard a clip from Erin Murray from Loyalty Status Co. Erin is the chief marketing officer at Loyalty Status Co, best known to consumers as statusmatch.com.

(00:36)
In this episode, expect to hear about the secret algorithms that airlines and loyalty programs use to rate your value as a customer, how you can make yourself look like a more attractive customer so that you can get more loyalty benefits, upcoming innovations in the world of frequent flyer loyalty, and so much more. And if you are in the market for a new card to earn points so that you can travel like Erin, check out geobreezetravel.com/cards. And if you’re not sure what card is right for you, I offer free credit card consultations at geobreezetravel.com/consultations. We will send you personalized recommendations based on your particular travel goals, budget, and lifestyle. And now, on with the show.

(01:25)
Hey, Erin. Welcome to the Geobreeze Travel Podcast.

Thanks, Julia. Thanks for having me.

I’m very excited to have you here and to talk about the loyalty industry, the future and innovations that are going on with airline loyalty and status matching and all of that. But before we jump into all of that, tell me a little bit about yourself and your background, and how did you get into the wonderful world of airline and travel loyalty?

Great. I’m Erin Murray. I’m the chief marketing officer at Loyalty Status Co. Your listeners might know us as StatusMatch. We run the platform that helps consumers match their existing status into new programs, which allows brands to attract really high-value frequent flyers.

(02:10)
Prior to that, I worked in loyalty for 25 years. I feel like I have to stop admitting that, but I started right out of school and started in database marketing, which at the time really was just a small kind of niche industry in marketing, but now is foundational to loyalty marketing. All loyalty marketing is just based on the data that is available to members. So started there on the agency side and then moved over to Air Miles, which was at the time the largest coalition loyalty program in Canada, and spent 10 years there. After that, moved to the travel technology company Points, and Points is the provider of the platform that allows brands to sell their points and miles directly to consumers. So really sort of fascinating side of the loyalty business. And then now here, at Loyalty Status Co with a focus on status optimization and commercialization.

Yeah. For anybody who watches our YouTube videos about, oh, these points are on sale, you can buy Alaska miles at 1.80 cents per point and redeem it for three and a half cents per point, that’s points.com.

Exactly. Yes.

How did you get into status matching from the side of, “We sell points,” to, “Now we effectively sometimes sell status matches,” or there’s different ways that you guys structure your campaigns, but how did you decide to make that move?

I mean, when I left Points it was a really great opportunity with Loyalty Status Co, which was starting out to grow the Status Match business. And when you look at the industry overall and sort of have this full view of where the innovations are happening and what we predict will happen next in loyalty, I think that status is one of those really untapped opportunities where a lot of programs have been relying on them as just kind of set-and-forget programs. They haven’t received the level of attention that other aspects of the programs have.

(04:17)
So coming from something like Points where we were heavily relying on data to personalize every Points offer, saw an opportunity to do that at Loyalty Status Co as well. And I think when you look at how, I mean, familiar you are with selling points now, but probably not as much on commercialization of status, that’s where we were 10 years ago with points. Nobody really understood about selling points and the value and how you could maximize redemption opportunities through loyalty currency retailing.

(04:53)
So I think that we’re at this pivotal point with status where that’s what’s going to be next is programs focusing on how do I monetize this in a way that’s really meaningful to customers, but that also can be profitable for the airline. So it just seemed like a really exciting opportunity to be a part of that.

What do you think are some of the best innovations that you’ve seen in the industry where different airlines will leverage status to gain those more lucrative customers where they can provide value for the customers but also generate a lot more revenue for the airline? What are some of the most innovative things you’ve seen?

I’m an avid Aeroplan member and I think that they’ve been leading the way in terms of how to evolve the status programs, and the unbundling of some of their benefits is one of the most effective ways to do that. It helps them manage their costs, but it also is providing real value to members. So as a 50K member or 75K member or a super elite member, you can select what benefits you want as a part of your status program and part of your status benefit package. So if you want upgrades or you want even free Wi-Fi on every flight, whatever those benefits are, they’re unique to you.

(06:14)
I think that is where every airline will go is towards a status program that is unique and tailored to every single one of their best customers, and Air Canada really was one of the first to start doing that.

You mentioned best customers. Who are the best customers? Are they the ones that just spend the most money and use their points in maybe not the best way possible? Because airlines make more money that way, right? Do they secretly hate me and all of the other people where we’re really gaming the system?

The real beauty of any loyalty program is that it provides all of this data to the brand. So without the loyalty program, they wouldn’t understand who their customers are to the level that they do, but they also wouldn’t have the ability to drill down into kind of a true value analysis by customer and say, “All right, Julia travels 50 times a year, but it’s on really low yield fare sales,” it’s buying miles on sale and then… So they have all of this data, and when mined correctly, they can do a very detailed value analysis on each customer. And it’s certainly not that they don’t want customers like that. They just want to treat you differently to determine how can they increase your value, how can they shift you over to a higher fare class.

(07:45)
So without the loyalty program and without you actually being a member of the loyalty program, they would have none of this data that allows them to do that. They wouldn’t be able to personalize the offers to you and to every other customer that they have. And that, I mean, the amount of revenue they generate from driving incremental sales out of that is phenomenal, but also the amount of money they save because of marketing efficiencies, not just having this spray and pray approach on all of their marketing.

With that type of value analysis, I’m sure we have some listeners who are like, “I like to never pay for flights, especially in business class. Crossing an ocean, I could never spend $20,000,” or whatever it is. What are some ways that you pitch to different airlines, here’s how we can get a little bit more value out of these people who, for lack of a better term or a little bit cheaper when it comes to how much money they want to spend on travel, but still want to have those really luxurious experiences?

So it really depends. I think it depends on the individual member, when that would change, what tactics we think are best at motivating them to change their behavior. But in general, we’ll find ways to help members that may not qualify for status organically. So let’s say that they’re not going to reach that next tier because they’re flying more on redemption flights. So they are consolidating all of their flying with this one airline, but they’re not doing it in a way that’s going to help them qualify for status. So that airline still wants to keep the member. They want to, as I said before, find a way to convert them into a higher value member. And in order to do that, they want to help them get and reach the benefits that are really going to be meaningful to them.

(09:42)
We would pitch to an airline, “Okay, offer that member the ability to pay a small fee, and they can earn double or triple the number of status miles that they normally would,” which means that even on those few flights that they’re taking, which are full cash fare flights, they will be able to earn status even though it’s not the normal amount that they would require. And then once they earn status, they recognize the benefits, they feel rewarded and recognized as a part of the program, and that just organically starts to grow them into the type of customer that that airline really wants. So that would be one way is to offer them things like boosters, multipliers, different lifts throughout their status journey.

From a marketing standpoint, how is it different marketing the world of status and the importance of status to the airlines who might not even realize the goldmine that they’re sitting on versus marketing it to more of the consumer side? How does that marketing play kind of differ?

Yeah. At the end of the day, at a really high level, it’s somewhat the same. I mean, you need to understand what the airline wants, what the consumer wants, and then your marketing messages are going to be tailored to speak to those specific objectives. But when it comes to marketing to an airline and trying to have them understand the power of status, it really comes down to the data you have available. So gathering important critical data points around a member who has status is X percent more valuable, a member who loses status may never fly you again, all of those points are really important to ensuring that an airline starts to realize that the importance of these programs and of actually investing in optimizing them.

(11:38)
Whereas it’s much more fun marketing to a consumer on the value of status. And it goes back to, again, I keep saying data, data, data, but that’s what it is. It’s all about understand who that person is. And now, thanks to AI and technology, you really can talk to them at a much more personalized level. So talk to them about why status matters to them. And why status matters to me would be different to why it would matter to my mom. It makes my work travel so much more seamless and enjoyable. So speak to me in those terms. Motivate me with when you know that I’m a business traveler. Whereas somebody else like my mom, who is a leisure traveler but likes to travel will have a much higher end experience when she does travel, that’s a different marketing message altogether. Understanding your customers and personalizing the message is key.

I like how data-driven you guys are because a lot of people are like, “Oh, marketing is pretty photos and going viral on social media and fun campaigns and stuff.” Do you guys incorporate that at all or you’re just like… It’s a completely different approach to marketing instead of, “Here’s a billboard with pretty photos”?

Definitely not billboards with pretty photos, and that’s even when I was saying about coming out of university decades ago and my first job being in database marketing. It really introduced me into the beauty of a true empirical approach to marketing, which was I can measure every single thing I do at a customer and channel level. So there’s something so rewarding about that, and no loyalty program would now go back to the days of… Not to say that nobody’s doing brand marketing anymore, but definitely primary investment is going to be on true data-driven marketing. So yeah, that’s the most exciting part of marketing and that’s the only way that loyalty programs work. They only work if you’re building true relationships with customers. And you’re only building true relationships relationships if you’re talking to them like you know them.

(13:48)
So you’re not building a relationship with a billboard or with a magazine ad. You’re building a relationship with ongoing personalized communication, and that’s critical to the success of any loyalty program.

As somebody builds loyalty, it’s often about all of those little moments that will add up eventually. And I think for some people they’re like, “Oh, it takes away the romance and the magic of all of that if you’re quantifying every single thing.” I hear this a lot of this being an actuary in my past life. How do quantify these little magical moments of, “Oh my God, and then I got upgraded,” or, “And then they brought me cake on the plane for my birthday,” or something like that. From a marketing perspective, is that something that’s quantifiable or it’s just magic in the air?

Those magic moments, they do feed into some commercial model somewhere. There is a cost to that benefit which provides that magic moment, and there’s a cost to understanding who that individual customer is and ensuring that those benefits are tailored to them. But I think that the fact now that we have all of the AI, tools and technology, they’re all allowing these programs to actually be able to sit on the back end and understand, “Okay, I can invest X in this customer because they are going to spend Y.”

(15:13)
So status programs are really great examples of that. If you spend X amount of money and you fly X amount of segments, we can give you this many upgrades. All of those are the experiences that are creating the magic moments, which are truly building the loyalty, but somebody’s doing the math on the back end to make sure it makes sense.

Since our audience is a lot of people who like to game the system and kind of figure out the algorithm behind what can be done, for somebody if they’re like, “I don’t travel that much and I’m not really loyal to any particular airline, but, man, I’d really like to do what I can to game the system and get some of those magical upgrades or just the special treatment that some people post about whenever they take their once a year vacation or something,” from the consumer side, is there something that can be done to kind of be like, “Hey, whoever you algorithm gods are in the revenue management loyalty department, whoever manages this, pick me”? What can be done?

That’s a tough one. To say, if somebody, again, if somebody has the intention of becoming a more loyal traveler, then there are ways that the system would identify them and provide them with opportunities. But I think other than credit card bonuses, I don’t think there are really quick and easy ways to get that next level experience, or marry someone who travels a lot and ride on the coattails of their status benefits. I think that those are the two. Credit card… But yeah.

I’m laughing so much because we are now two for two on people from statusmatch.com who have mentioned just marry to it and you’ll get the benefits.

[inaudible 00:17:03].

It’s a thing. People just marry and do… Yeah, the airline loyalty program. My brother-in is a pilot and I tried to explain the world of points and miles to my brother-in-law and his now wife, my new sister-in-law, and they were just like, “But why? We just get discounted fares. Why do we need to learn anything about points and miles?” I’m like, “Yeah, that’s true.”

(17:21)
Okay. So the advice there is see if you can marry into it, but also the algorithms are pretty good at figuring out your intentions on if you’re just trying to game the system. If you’re going to be a one-time flyer, it might just be worth it to just pay more for the benefits that you want instead of rolling the dice and being like, “Maybe I will be the chosen one out of the universe.” Because as you mentioned, behind most magical moments, there’s usually a math algorithm when it comes to anything revenue-driven. So I tell people all the time, instead of hoping for free a breakfast, hope isn’t a strategy, maybe just add that to your travel budget or something like that.

Yeah. Exactly. I’m asked all the time too, “What program should I be a part of so I can be rewarded the way I want? What credit card should I get?” And it’s so unique to the person. I think you have to look at it almost like you plan all your other financial goals. Loyalty currency is a currency, and so the same way you’re thinking about what you want to do, how you save your money, where you invest it, it’s kind of the same thing with loyalty that if your dream is that you want to fly once first-class to Maui, it’s a different set of behaviors and a different loyalty program maybe that you would need to be a part of than if you want to redeem for all of those hockey tournament budget hotel stays that you have all year just because you don’t want to worry about them, and very different redemption goals and which would mean there are different behaviors and different programs.

(18:53)
So I think that’s what people need to do is understand that there is… You need to plan for it and you can, but you have to understand what your goal is.

For people who are thinking, “Well, my goal is just to get really nice status because I like to feel important, I want the upgrades,” all of that, isn’t the hack to just purchase a status match from statusmatch.com or is that not a one-size-fits-all solution?

Well, I mean, in that case, though, somebody has status. In that case, they are a frequent flyer and status match is a really great way to provide the opportunity for a frequent flyer to try another brand because that what’s really important for every brand to know is that if I’m getting lounge access and seat upgrades and priority boarding, I’m never trying another airline that isn’t going to provide me with the equivalent benefits. So a status match isn’t a way for non-frequent flyers to get all the benefits of status. It’s a way for brands to really acquire high-value frequent flyers and give them the opportunity to experience their brand.

Yeah. I think that’s missed on a lot of people where I’m like with status match, you need to have one status matched to another status.

Yeah. And sometimes there are brands that are a little bit more open. We have brands that will offer status match to hotels and hotel status is much easier to acquire. So that is a way. Cruise. They offer status match to cruise. So there are brands that are willing to open it up to people that have status that is much easier to attain, so not equivalent airline status, in order to get to give them the opportunity to try the brand. So that’s a way in for somebody that might not be a true frequent flyer.

Yeah. For sure. If you can get Hyatt status just by putting Hyatt spend on the credit card or doing some mattress runs at the Rio in Las Vegas or any of these other shenanigans that I’ve talked about on my YouTube, it can be a really easy way to status match from a hotel program over to an airline program.

Exactly. Even, actually, we have a credit card offering so that there are certain airlines that will match based on your credit card. So if you have a travel rewards credit card, you then clearly are showing a true intent for travel and high likelihood to become a frequent traveler. So they’ll offer a status match usually to the lower tier, but they’ll offer a status match when you show proof of travel rewards credit card.

If someone’s trying to decide between just going for status or going for more points and miles to just book the business class that they want because status doesn’t always guarantee an upgrade, what would your advice be for how they should allocate their time, energy, brain space, dollars?

Status. I would say on so many different levels that what makes sense. Points and miles are, and even for a brand and for a consumer, points and miles are transactional. It’s not about what’s building your loyalty. Status is about the benefits, the deeper emotional connection, the magical moments you said. So go for status because while you’re chasing status, you are building your points and miles balance at the same time.

(22:18)
But I don’t even think about my points and miles balance in that process. I think about how am I getting to… At the end of the day, if what I want to use my points and miles on would be things that would give me a elevated travel experience, why not skip looking at that and just focus on chasing status, which is going to ultimately give me all of those things. So my recommendation would always be on that.

Would you recommend chasing status even for people who rarely fly, or if they’re bringing four children along with them, it’s once every two years family vacation, is status still the play there, even if they might not use it very much going forward?

If somebody flies twice a year, they’re not going to organically qualify for airline status in any way, but there may be ways that they could get hotel status, and that will provide them with meaningful benefits, especially when you have a family and you can get an upgrade to a room. So I think status is important in those cases, but they’re not going to get it organically through flying. So it would be looking at other ways to unlock those benefits, and potentially, as we talked about before, there will be this unbundling of status in a way that some non-frequent flyers will be able to purchase some of the benefits within status down the road.

Yeah. I think we’ve seen that trend a lot with Hyatt doing the milestones where you can choose between do you want the $300 credit [inaudible 00:23:50] experience? Do you want 10,000 points? Do you want a suite upgrade certificate? So more of that kind of personalized choice. And I wouldn’t be surprised if in three or four years they’re like, “Well, you’ve been Globalist for three or four years, so we already know what you like and we can send you personalized marketing that way.”

Yeah. And you can’t talk about innovation and loyalty without really drilling down into AI because that’s exactly what AI will do is that it’s going to… All of those things right now that we see Hyatt’s doing and Air Canada’s doing, they still do rely on some manual processes. Whereas once the data’s been adjusted and you start to understand what everyone wants and what… It’s very easy to build these customized benefit plans through leveraging AI, and I think that fundamentally changes what programs can do.

(24:41)
Because there’s a lot of risk right now, there’s a lot of negativity in loyalty right now around… Because with the DOT investigation into all the US airlines around whether or not they’re truly providing value and they’re devaluing their currency. That is causing a lot of people to speculate that air loyalty programs will continue to go on a downward trend. Whereas I think the opposite will happen because of AI. Because AI is going to allow these programs to then personalize the offer, which should decrease their cost of delivering those benefits overall, which means that they don’t have to actually devalue the currency to offer the same perceived value that they’re offering today.

And thinking about the quote in the movie The Incredibles where if everybody’s super, then that means nobody is, as it becomes easier to obtain status and more people are getting into the game. Do you think that will devalue how special status is, if everybody’s Emirates Platinum status, then nobody is? What are your thoughts on that? Because everybody’s always afraid of, I think the scarcity mindset of, well, there’s only so many upgrades available on a plane.

No, I think it’s a really important point, and it has to be considered and it should be considered by every airline if lounge crowding becomes an issue, upgrade availability becomes an issue. So I don’t think anyone would ever propose that it’s a free-for-all for status. I think it’s a very measured and data-driven approach to how do you actually better use status to drive the desired behaviors you want out of customers, and structure it in a way that it is meaningful and beneficial to the customer, but still profitable for the airline.

(26:32)
So it’s certainly not saying everybody should get lounge access, but there is an opportunity to increase the number of status members if looked at it that if you increase them and you have data that says they’re incrementally more valuable, then there are ways that you can use that money, that the incremental revenue that they’re driving to change lounge capacity or offer different benefits. As long as you can ultimately prove that there is incremental revenue there. I think there are ways that you can improve the value proposition of those programs overall and avoid it just being about getting into the lounge or getting upgrades.

What do you think are some of the benefits that people love most about getting status? With all the research you guys have done where you’ve surveyed so many people about why did you do all of these weird, irrational behaviors just to obtain or retain your status? Is it the upgrades? Is it the lounges? What is it that people want?

Those are definitely a popular response, but what is really surprising is the number of people that say, “I want to have the gold card. I want to have the platinum card.” There are people that status is… It’s almost like an ego motivator. So yes, in the real tangible benefits, people care about lounge access. They want to line up in zone one. It’s amazing the number of people that will say that as well, but it’s also just about, it’s, “I want it because it gives me status, me as a person,” and yeah.

I think it’s that way with most luxury products too where it’s like, why do you want this Lamborghini? Why do you want these Fendi shoes or something? Because other people don’t have it. And I think just as humans, we want to put people into hierarchies, whether that’s right or wrong, and we can just kind of see who’s at the top of the pyramid that way with status, and everybody wants to be near the top.

Exactly. That’s exactly it.

When I think about what I would want out of my status, it’s not necessarily, oh, the AI knows if I prefer Diet Coke or Coke Zero. I couldn’t care less if they know that about me. What I would want is if my flight is canceled or delayed, American Airlines will pick me out of a crowd and say, “Ms. Julia, you are more important than all of these people. We will solve your problems first.” That’s really what I want out of status is people proactively solving my problems for me. Is that something that they’re even considering in the innovation hubs for these airlines, or is the focus so much more about, “Here are these extra benefits,” whereas I’m just like, “I don’t necessarily need all of the extra positives, I just need fewer negatives. I need to get where I’m going, especially if it’s for a conference or something like that.”

Well, I mean, it happens today. So it is absolutely a guiding principle for most of the major airline loyalty program brands would prioritize their top tier members above and beyond everybody else. So I’ve definitely had that happen to me where a flight’s delayed. They’ll walk right up to you, pull you out of the line, say, “All right,” move you to the front, and it’s a game-changer. I would be the same. I could sacrifice a lot of the other benefits for that. So it is happening today. It might not be happening at scale. I think when something relies on there’s the human factor, then it’s not always delivered flawlessly because you have to make sure somebody who’s at the airport that is dealing with all of these negative people that are worried about a flight delay to think, “Oh, I should go and find my super elite customer and make sure they’re feeling like they’re taken care of right now.” But it is the guiding principle, I’d say, for most top tier programs.

I have executive platinum with American Airlines, and the last time my flight was canceled, it was just Hunger Games. It was just like everyone on their own. I booked a Southwest flight because I’m like, “I got to get to…” wherever I was going that day. But yeah, that’s really what I would want out of loyalty programs is just anything that goes wrong, fix that. I don’t need all of the extra bells and whistles. I just need for things to go correctly as I need to travel. And also, I mean, the most engaged market you’ll ever see is when a flight is canceled or delayed. So they can just be like, “For anybody who is interested in becoming higher tier status, Julia special.” That’s it.

Oh, exactly. It’s the best marketing tactic ever. But yeah, I think the U.S. market is very different right now when it comes to how they’re managing their programs, like everything that happened with the Delta changes. And so I think there is a focus now on… Because there’s been consistent devaluation of currency and of the status programs year over year, but I think there’s a real focus now on this we need to ensure that we’re protecting our best customers and we’re protecting the value of the loyalty programs. And the loyalty programs are really only as good as the value they’re giving back to customers. So customers don’t have a lot of patience with it. So they will select another brand if you can’t continue to deliver those benefits, and real true relationship benefits that come with a status program.

For people who aren’t well-versed in databases and spreadsheets and they’re trying to figure out on their own, is this airline status worth it for me? Am I getting the juice out of the squeeze? Are they actually delivering value to me which is on par with what they should deliver? What’s rules of thumb for people to decide, “Oh yeah, I’m getting the value out of this program,” or, “I should switch airline alliances”?

Yeah. I mean, that’s such a tough one, and it’s been a hot topic recently because of this investigation, the DOT investigation where they’re talking about airlines needing to provide true transparency. So tell everyone exactly the value of a point so that then they can figure out, “Okay, I need to spend $10 to earn…” The value of a point is two cents. Whatever. But because of that, there’s been a lot of demand from customers saying, “I want full transparency.” I don’t think that is where we should end up is with a fully transparent price per mile, or everybody would just be better off having a cash back card.

(33:25)
So I think the benefit of your example of being pulled out of line, it’s such an important… I will pay more for my flight if I know I can trust the brand that I’m flying with to treat me like a best customer. And so it’s not about doing the math in that case on what is the cost of that? It’s about how important is that to me? And I’m probably willing to pay a little more for a flight where I can guarantee that will be my experience.

(34:01)
So I don’t know if that really answers the question, but I think it’s just such a tough one with what the true value of status is right now because it’s so different to everyone.

You mentioned someone’s willing to pay more to guarantee experiences, but so many things in the world of travel are not guaranteed, and a lot of times where people are like, “Should I get this card? Are things going to devalue? I need to know exactly what is going to happen in the roadmap of the future,” which two things from that. One, nothing’s guaranteed. Anything can change and we don’t have insight into that. I can’t conjure award availability. But also, does it take away from the magic a little bit if you already know what’s going to happen, there’s no surprises in life? What are your thoughts about that where people are approaching travel like, “It’s supposed to be transactional, I should know exactly what’s going to happen,” versus the nature of the game is it’s not guaranteed.

I think that the more loyal you are to certain… or to a brand, then you should be able to trust that you’re going to have a smooth experience. Not that there’s never going to be a delay, but that if there is, you’re going to be taken care of. And so I look at that as a true relationship building. It’s not about I just want to collect my points. It’s about I want you to know me. I want you to know what I care about. I want you to communicate with me about the things that I care about, and I want to be taken care of on my travel journey. And that really only happens if you are truly loyal to a brand, and they have built a program that is meaningful to you. That’s at the heart of what every status program should be.

For people who can’t reach that level because they’re infrequent flyers or anything like that who are listening to this, enraged, being like, “That’s just how you should treat humans. You can’t just leave all of the brokeies off to the side and not fix our problems,” what are your thoughts on that and how the airline should respond if it’s just like, “We have limited capacity, we need to put it towards our best customers”? What happens if you’re one of the worst customers who, this is the only time you’ve traveled in a decade? Are you just kind of left to the wolves, and is that how the world of loyalty works?

Yeah. It definitely should not feel like that everyone’s left to the wolves if you’re not a status member, but I think about if somebody is splitting their business across five different airlines, and that means that each one of those airlines only knows a limited amount about that person, so they’re limited in how they can help them too. It’s even in communications, like how an airline can communicate with you. It’s night and day if they know who you are and they have some experience with you flying with them.

(36:59)
It is about, little by little, if you’re continually, even if it’s once or twice a year, but you’re flying with one brand, then your experience should improve every time that you travel with them because they know a little bit more about you. If it doesn’t, I would say that’s not the right brand to be flying with at all because it really should. You should start to feel a difference that they know who I am, they know I travel with my family, they know I travel twice a year for leisure. They know all of those things matter, whether or not you fly twice a year or you fly 20 times a year.

Which customer would be more valuable to an airline? One where they’re only traveling a couple times a year and you’re like, “I love Delta. All my money goes to Delta,” but there it is, versus somebody who travels 10 times a year and they’re kind of split between Delta and American Airlines?

(37:51)
If you were Delta, would you be like, “This person’s so loyal. We have 100% of their wallet. They’re great. We should treat them better”? Or is this person where you’re like, “There’s more money to be made over there because they’re kind of splitting their loyalty between Delta and American Airlines”? Which one is considered more high value?

Yeah. I mean, both. It’s totally two separate… It’s retention and growth strategy for that customer that’s staying there. It really is about how do I have them spend more money when they’re on board, spend on ancillaries? How do I get them to fly more frequently? How do I get them to buy higher fare classes? All of those. So there’s a strategy that is focused on that member that’s flying with them 10 times around how do I retain them and how do I grow them. And that sounds very cold, but it is meant to do it in a way that is beneficial to the consumer. Whereas that member that is split and there’s an opportunity to capture full market share, it’s a different strategy, it’s acquisition, it’s truly getting them to what is it going to take to get them away from these competitive airlines and bring them over to capture all of that market share.

(39:03)
And I think there’s so many other things that go into that analysis. How valuable are they? Do they always fly business class? Because that’s a huge difference than somebody that always flies the econo fare on… So I think there’s a lot of different factors, but at the end of the day, they want both of those customers and they want their full market share.

From a consumer side, if I want to appear more valuable to my airline of choice where I’m like, “I’m really into American Airlines, but should I make them a little bit jealous and throw in a Delta or United flight here or there?” I know loyalty status isn’t the weird games of dating or whatever people do these days, but what is that game that people do where they’re like, “I want American Airlines to be really into me”?

Mm-hmm. That’s interesting because, I mean, they basically will publish all the criteria of what they want you to do for you to become an interesting perspective customer to them. So I think as you start to, if you look at every one of those airlines, they have a map of here’s how many miles you need to earn, here’s how many flights you take, here’s how much money you spend, and it kind of moves you up from a base member all the way… And as you start to move through that lifecycle or the tiers, they are watching you and trying to build in milestones and triggers that will help you get to the next level. So it’s quite easy to understand what every airline wants you to do. They will publish it on their site. And if they’re really have strong marketing plans in place, then you will be triggered with communication to help you grow throughout and move throughout that lifecycle quite seamlessly.

If somebody is an ultra frequent flyer and they’ve got lifetime status with a particular airline, is the best strategy to keep flying with that airline or to be like, “Got this one locked in already, kind of enjoying the chase. Let’s go over to another airline, do a status match, get lifetime with that”? What’s the better strategy for somebody who’s ultra frequent flying? Should you diversify a little bit and have multiple airline statuses, or is true loyalty, as the airlines want, or you to just stick with the one you have lifetime status with?

Well, I think once you have lifetime status, I mean, lifetime status is a really interesting one because you aren’t as motivated to have to fly. So you can price shop and if you can status match, you potentially could sample another airline that’s going to give you the same benefits. Most of the time, you would never move to another airline that’s not going to deliver you the same type of elevated travel experience that you get with your lifetime status airline.

(41:54)
But I was talking to a guy at a dinner last week and he was lifetime platinum at Marriott. He’s like, “I always stay at Hyatt now. So I have my Marriott, but I prefer Hyatt.” And Hyatt, because they have a limited number of hotels, they bend over backwards for anybody that is a status member. This is like next level. Whereas Marriott has so many status members that it’s harder to really feel and the benefits of status. So it was funny seeing that where he’s like, “I’ve found a new brand that recognizes that is far better at rewarding me in a way that I like to, but I still have this lifetime status that I use whenever I want.”

I run into a lot of clients who are the same way where I’m just like, “You’re going to get more value out of your Hyatt points if you’re traveling somewhere that has Hyatt hotels,” and they’re like, “Yeah, I know. I just need to check off this box, lock in Marriott status, and then now that I have all those benefits for life, I don’t feel the need to use them, I can just move over to Hyatt.” So the psychology of that is really interesting. It almost seems like it does the opposite of what the hotel loyalty programs would want if Marriott’s like, “Congratulations. We are now, we’re holding together for life,” and you’re like, “That was fun. I’m going to go chase this other thing now.”

Well, but that’s like any brand that at the end of the day, even if you give them status, it doesn’t mean… Status itself doesn’t mean anything. It’s how you’re treated. It’s the benefits that are available to you. I mean, yes, of course there’s the Fendi bag analogy of status, but other than that, it’s about what am I getting? So in that case, if Marriott’s really… And this is just an anecdote, I have no real opinion on Marriott’s tier program, but in that specific example, if Marriott’s not keeping this highly loyal member because they’re not offering them the benefits that really matter to them, that’s on them. You need to ensure that regardless of who that customer is, that you’re continuing to, even if they have already qualified for life, you’re continuing to try and build and grow that relationship.

Do you think that there is some kind of social status in having lots of different statuses where somebody’s like, “I went to statusmatch.com and now I have American Airlines and Air France and Singapore and Hyatt and all of the casino statuses and all of these cruise line statuses,” where it’s just like notches or whatever on a belt loop or something where you just have all these statuses? Does that play into the psychology of the status game to just have a dozen of these at your disposal?

Yeah. I think that there are definitely a segment of customers that are exactly like, that want status for status. It’s a love to be able to pull out all the cards that they have, and there’s a real showy piece to it. So there is a segment of customers, absolutely, that StatusMatch, it serves that need. But in general, I would say it’s not. It is a customer that is loyal to Marriott, but you’re going to stay somewhere that there’s not a Marriott and, “Okay, this is a great opportunity, I can try another property and if I can get the same benefits, I might actually start to shift my loyalty over”.

(45:17)
So a fantastic opportunity for the brand to potentially win over a very frequent traveler by providing the same benefits that they’re getting at their other program. So I think more often than not, that is the use case. It is not the person that wants a hundred different statuses to show at dinner parties.

Which is most people who listen to this podcast, funny enough.

And I know lots of people too, that they love their multiple status.

With international statuses, and international being outside of North America, why might it be a better strategy if somebody’s like, “Oh, you guys are offering a status match over to Vietnam Airlines or Air France,” or something like that, if someone’s like, “I have no intentions of going to Vietnam or France, why would I need this?” Why would somebody want to do a status match to an international status if they’re not flying to that home country?

The alliance is it’s really about the power of the alliance. So if you’re matching into a Star Alliance carrier or a Oneworld carrier, a SkyTeam, whatever it is, then your benefits on the airline that you’re matching into, you’ll get the equivalent alliance benefits. So those benefits would apply if you’re flying elsewhere. We generally don’t encourage people to do that, but it is a really great opportunity for customers to potentially be able to fly another airline that’s a part of the alliance and get those same benefits because they match to a separate brand that was an international brand that they won’t fly as frequently.

I think there’s a lot of benefits with lounge access as well. If you’re flying domestically in the United States… For example, I was based in New Jersey for about three years, and the main lounge was the United Lounge where the Prosecco, it tasted like paint thinner. It was terrible, but that’s what we had. And if you had United Gold status, they wouldn’t let you in if you were just flying domestically. But I was able to get my status through Singapore Airlines, so I had Star Alliance Gold. They would let us into the lounge there where I had the equivalent status as my husband who had United Gold, but they wouldn’t let him in. They would have to let us in through my Singapore account. So if you look like an international traveler, even if just flying domestically in the U.S., that can have huge benefits.

(47:46)
I know that when there was the British Airways status match, a lot of people jumped on that because they were like, now I can get into Admiral’s Clubs domestically with American Airlines. Same with if you’re more of a SkyTeam person with Delta, the Air France status match might be really worthwhile to look into. I don’t know if that’s the same in Canada, but in the U.S., if you’re flying domestically, having international status so that you can get Oneworld Emerald or Star Alliance Gold or something like that can be very valuable, more so than getting the domestic version of that status.

Right. Interesting.

Yeah. Yeah. Lots of fun status games to be played. So as we kind of wrap up here, what is your favorite way to level up your status or the best advice that you have for people who are looking to get more statuses or level up their status with their favorite loyalty program?

Yeah, I would say if you have status, status matching is definitely a great way to be able to try another brand. And so, absolutely, that is one of the best ways. But I think that there are also several opportunities for members that can’t qualify organically to find ways that they can either boost the number of miles they’re earning, so a lot of brands are offering this, or at the end of the year, pay a fee to buy up to status, and then do the math at the time when they’re getting the offer. If somebody says, “You’re 2,000 miles short of your status,” your offer to pay X to purchase that, think about what that’s valued to you, and it’s going to be different to everyone, but in a lot of cases, it’s highly worthwhile to take advantage of those offers when the brands present them.

Very important to do the math. I know so many people that are like, “This influencer posted about this deal, so I should buy this status, or I should buy these miles.” And I’m like, “Are you ever going to use these? What for? To what end?”

Exactly.

And some people are like, “To look important with status.” Which, I mean, the world of loyalty and status is to drive somewhat irrational behaviors to feel a little bit more important and to be treated like you’re more important, but if you rarely travel, it’s always important to do that cost benefit analysis of what will it cost to buy the status or these points, versus, realistically, how often will you get free breakfast? How much will you get free upgrades? How much will you use the benefits that you get with that status? Or if you’re just like, “It’s priceless, I get to show all of these status cards at a dinner party,” that’s totally cool. Just go in eyes wide open about why it’s important to you and how much value you put on that.

Yeah. Absolutely.

Perfect. Where can people find you if they have any questions, or where can they find StatusMatch if they have any questions about matching status or leveling up or anything else like that?

Yep. Statusmatch.com is a great resource for what status offers are available. You can find me on LinkedIn. Message me if you’d like. Erin Murray at Loyalty Status Co.

(50:50)
Thanks very much, Julia. It was great to chat with you today.

You as well. Thank you so much for coming onto the show and dropping some hints about the algorithms that airlines use and hotel loyalty programs about how we can level up our points and miles game and our loyalty game as well.