Scroll Top
Business Class - Status Match

As a kid he collected airline time tables and model planes, now he’s running one of the most innovative companies in the travel industry, StatusMatch, pairing frequent flyers with destinations and airlines that want their business. Meet Mark Ross-Smith, Author, Founder of industry news site “Travel Data Daily.”

Business Class is brought to you by The Tourism Academy

Speaker 1 (00:00):

Business Class is brought to you by the Tourism Academy, harnessing the power of science, business psychology and adult education to advance the tourism industry and build sustainable economies. Learn how to engage your community, win over stakeholders, and get more visitors at tourismacademy.org.

Steve Ekstrom (00:17):

Steve Ekstrom here, host of the Tourism Academy’s Business Class podcast. Today’s guest is the author and founder of industry news site Travel Data Daily and CEO of StatusMatch Mark Ross-Smith. Mark is joining me. We are recording on the American Thanksgiving holiday, but you’re joining me from… Where exactly in the world are you?

Mark Ross-Smith (00:45):

I am in Malaysia, truly Asia.

Steve Ekstrom (00:49):

So we had a little chat the other day and one of the things you talked about is airline status. Why is airline status so important to people who hold it?

Mark Ross-Smith (01:03):

I’m glad that this podcast is three hours, [inaudible 00:01:08] going to take to go through this. So airline status, the 101s is people that have airline status represent the top 5% of global frequent flyers. They spend more, they travel more, they spend the right type of money. They’re in business class, first class. They’re booking just right before travel. They’re just spending more and they’re more valuable. And this group represents somewhere between 30 and 40% of total ticket sales for airlines. So they’re the single most valuable group to the airline, the arguably to the tourism industry. If these people stop flying, like we saw in the last few years they did, it really hurts things. Because some airlines could delete economy and coach and fly purely on business and first class. And so these people tend to fly up front, and hence status is important cause it keeps these people coming back, it keeps their ego churning along, and keeps them spending money with traveling with the airlines.

Steve Ekstrom (02:14):

How did you get interested loyalty programs and status and travel in general?

Mark Ross-Smith (02:25):

So a few years back… I’m from Australia originally, and I had a different business in the telco industry, and I was a frequent flyer. I was just millions of other people around the world just traveling for business and work and going to conferences and events and go lunches, business meetings and stuff, doing day trips. And really enjoyed it, actually. I enjoyed the travel, I enjoyed the perks and benefits of flying. And when you start flying a lot, the airline wants to get to know you a bit more, when you start spending some decent cash. And so I got to meet some of the management in… This was Qantas at the time. Got to meet a bunch of people in management, and I thought, “This loyalty business is really interesting because…” I was just learning.

(03:12)
I thought it was about earning points from when you fly and use those points for your free business class flight. The dream flight, “I’m going to fly to London in first class one day.” I thought it was all about that and airlines were just giving away these points of miles for free just to keep me coming back. And what I realized I was so wrong. The loyalty business in an airline is much more sophisticated, but they also drive a lot of revenue from credit cards, obviously, that are out there, earning miles on your credit cards. And so that’s really sort of got me interested. And so after I’d sold that business and I decided I want to live in Asia. So I moved to Hong Kong. It was either Singapore, Hong Kong, and I thought just kind of flip a coin and Hong Kong won. Love the city by the way.

(04:04)
And I thought, “I’m now effectively unemployed, what am I going to do now?” I thought, “Hey, I’ll get into the travel industry. Instead of paying for flights, I want them for free from now on.” Because you hear these stories about people working in travel and their $100 business or first class tickets around the world stuff, I want a piece of that. So I started just paying my way to industry events, to travel events. I had nothing to sell. I was there to… There’s no university to learn travel loyalty 101, it doesn’t exist, right? You’ve basically got to work at an airline or a hotel or something like that, and kind of work your way up and people teach you.

(04:47)
So I started going to all these events and had a lot of fun. And then I started the blog traveldatadaily.com, and started just writing about what I felt the travel industry could learn from the telco industry, which is where I’d come from. How to acquire and retain customers from that perspective, and that went really well. And I started getting invites to speak at some of these conferences, just panel sessions and stuff. And that kind of snowballed. Ultimately led to an invitation to work at Malaysia Airlines. Finally I got some cheap flights, so life goal accomplished at that point.

Steve Ekstrom (05:35):

So what would you say is the most important thing you’ve learned through travel personally?

Mark Ross-Smith (05:50):

Most important thing I’ve learned through travel? I think it’s an appreciation for people. We’re all basically the same. We’re on this giant Earth at the same time. And when you travel, you meet new people and new cultures. There’s this whole adventure part to travel that we all have in common. And it’s this innate desire, it’s kind of inbuilt in our DNA that we want to go see things and experience new adventures and see the sites and visit the pyramids in Egypt, and have breakfast with giraffes in Kenya, and trek through Yellowstone National Park and see waterfalls and sleep under the sky, and all these amazing things. And working in the industry really opened me up to that because a lot of people in the industry tend to travel more, and they tend to look for these unique experiences that…

(06:57)
When you work in travel you kind of share stories with other people in the business, and they’re kind of hunting for that next thing that’s a bit more interesting. Not just go to New York, Times Square, take a selfie, not that kind of stuff. But the stuff that’s a bit off the track, bit off the beaten path. And I found I had a new appreciation for what the world has to offer and all the amazing people from just all these different countries around the world. And I think we have all this in common. So travel has really opened my eyes to this really amazing, wonderful world that we live in.

Steve Ekstrom (07:37):

Is there a destination on your bucket list that you haven’t visited yet?

Mark Ross-Smith (07:42):

Yeah, Maldives. It’s been on there for a long time. I need to get around with it. I was just talking to my wife the other night about that. I’m like, “We need to go there.” It’s just one I’ve just been itching to get off my list for a long time. But actually breakfast with giraffes in Kenya sounds pretty good as well.

Steve Ekstrom (08:01):

It does. We see those videos and the clips on Instagram all the time. So what does it mean to Status Match?

Mark Ross-Smith (08:16):

So StatusMatch is basically you’ve got a gold or platinum status at an airline, or a hotel, or a cruise line, or car rental. And the way that the travel companies have acquired these high-value customers in the past is to give you what’s called a status match. So you’ve got gold with one airline and another airline gives you gold status, they’re matching your status. They say, “We’ll give you this gold status. Please come spend money with us.” And so it’s customer acquisition. Super effective. It’s been around for nearly 40 years as a concept, and it’s been growing.

(08:54)
For us as a business, we’ve built a structured platform around that and help airlines, hotels and different entities just have this formal structure in place so it’s not… Because what it used to be is you send an email to the airline and say, “Hey, I’m gold status with Delta. Can you please give me gold status with you guys?” And you wait three, four weeks and maybe you get an email back and they say, “Sorry, can’t help you.” And these people spend more, they fly more, and this is the number one cheapest, most effective way to acquire customers and anyone’s traditionally not been that great at it.

Steve Ekstrom (09:35):

So why is it important now that matching status moved to the forefront from where it’s been in the past?

Mark Ross-Smith (09:49):

I’m going to share two things with you I think you’ll like. Firstly, there’s a coined term called the status cliff, which is coming in the next two to three, six months kind of thing. So what’s happened the last few years, everyone’s had status around the world, has had their status extended for free for airlines, hotels, because travel’s been restricted, and it’s a bit unreasonable to think that you’re going to fly your 100 sectors that you used to 2019 again in 2020, ’21, et cetera. So airlines have been extending for free and it’s come to a point where it no longer makes sense to extend for free anymore. And so all these airlines, hotels are looking to downgrade people. And that’s going to happen anywhere between December and about March, April next year, depending on the brand. And the number of people that are going to get downgraded is I estimate between 30 and 50% of elite members globally.

(10:48)
This is about 20 million people. So this is 20 million people that traditionally are in the top spending group. Now, I think this represents two opportunities. I know you have a big tourism audience, so there’s actually a really interesting tourism angle here. And that’s, say you’ve been flying with airline A and their hub is in Dallas-Fort Worth, for example. And that’s what you’ve been doing for the last 10 years. You fly through this hub because that’s just… And they’re a partner of a big alliance. And then suddenly you get downgraded, and what goes through your mind is, “I’m going to try a new airline which has a hub in a different city.” Different city, a different network, a different alliance partners, they fly to different cities.

(11:36)
So what happens is, I think we’re going to see is a bit of, obviously, a share shift in terms of airlines and hotels where people stay at. But also, I think there’s going to be an opportunity for tourism here because now you’re being exposed to new routes, new networks, new countries that you never would’ve considered before because your main airline, or alliance, or hotel you stay with is in certain areas, and that’s kind of where you go to for a whole. Now you’re looking, “Where do I go for vacation? I’m going to go to this place because I can fly my favorite airline because I’ve got the perks.”

(12:12)
But now I don’t have status with the airline and I’ve got status with a new airline, their network looks a little bit different. And for the first time you’re thinking, “I never thought about Canada. Might go there.” Or this little obscure city somewhere. You know what I mean? So I think there’s a bit of an opportunity there. I mean they’re calling it the great reset of elite status. There was an article in the New York Times last week talking about how big this is going to be. So there is going to be a bit of a reset there. And again these are the people that traditionally spend a lot of money. They understand travel, they understand the perks, the benefits and all this kind of stuff. Yeah, I think interesting times ahead.

Steve Ekstrom (12:52):

What it sounds to me like you’re pointing out is there is obviously a pending gap in airline loyalty, but that’s also an opportunity, it sounds like, to tap into that customer market. So how could a destination or a tourism entity like a resort or something like that, how could they tap into that customer base?

Mark Ross-Smith (13:24):

I’ll talk briefly to a partnership that we structured with Destination Canada and Air Canada. It was a sort of three-way strategic tie up. And this was at the end of 2021 that we launched this campaign. And this is when the US-Canadian border just reopened again after being closed for so long. The whole idea was to bring people who are traveling with purpose to Canada again, so the Americans specifically. So instead of going to Mexico instead, come to Canada. You miss the snow, you miss the friendly people, you miss the pristine waterfalls. Come back and see us. Tourism in Canada was really the hardest sector hit. The government really need to step in and support the economic activities, especially in airline hotels. Small businesses as well. And the idea was to rebuild traveler confidence and encourage more of these high-value American travelers to come to Canada. Which of course, traditionally have been the people who spent the most in Canada.

(14:41)
And so we structured this sort of plan with Air Canada, major airline, where we would status match American travelers into Air Canada. So for example, if you had a Delta, United, American elite status, like a gold or a platinum type status, there was a big campaign around this, you can Google it, and they would give you Air Canada status, supported and sponsored by Destination Canada. And the idea is here’s your Air Canada top tier status, now fly the airline, come to Canada. Just try it out, just test it out. And so for a lot of Americans, this is the first time they may ever flown Air Canada, they’re really stuck on with their main airline. Obviously, hadn’t been to Canada for a while because the border was closed, and so it was a time to check it out, see the country that had missed them for so long.

(15:42)
And I give Destination Canada a lot of credit for their innovation here because they really want to do something different. They realized that you know, can’t just go back to TV and billboard advertising, and the traditional kind of media. You need to do something new. And they recognized that the money is in people with airline elite status. That’s where all the travel money is. And so how do you go after that audience? How would other demos find this kind of audience? Status matching, obviously very cheap, easy way to do that. And that campaign was ultra successful obviously for Destination Canada, for the country, for the airline, obviously us as a business as well. And ultimately, the travelers.

(16:28)
They got to try new airline, got to experience these new perks, which their previous airline may not have ever given them because some of these international airlines are pretty good with the extra perks that they give that are well above and beyond what American airlines give. So fantastic campaign. I think it’s about thinking about new things, being innovative. What could you do a little bit differently? Because these days people have a lot of choice of where they travel. There’s a lot of demand for travel, but people also interested in finding new things to do, new places to visit, and there’s a bit of competition there. So I think DMOs that are a bit more creative in how they market their destinations and how they can get people there, I think are really going to see some upside.

Steve Ekstrom (17:25):

So you’ve got an entrepreneurial spirit, I take it, from having a couple businesses under your belt. How do you define success?

Mark Ross-Smith (17:41):

I do have an entrepreneurial spirit. Is it obvious from the conversation? I mean you’re running a business, obviously the big measurement of success is… Actually, you know what I really enjoy? Is receiving the quirky emails from customers, from travelers. And this goes across all previous businesses. The quirky email’s like, “Hey… I mean in the Status Match example. “I did the Status Match with da, da, da airline, I flew them. Here’s some photos.” They’ve taken selfies on the plane of the meal tray table in front of them, or selfie with a glass of champagne.

(18:29)
And I get a bit of kick out of this because they’re genuinely happy. You don’t share photos with strangers if you’re drinking champagne in business glass unless you really got a kick out of it. So I love this kind of stuff. I love hearing the stories. And it kind of sounds a bit fluffy, but I like that I’m impacting people’s lives for the better. That’s really what travel to me is about. It’s about seeing the wonders of this world and broadening your experiences, seeing new people, new things, new food, new destinations, new everything. And when people share some of that, just a little piece of that bright spark of their life with you, that just totally does it for me. So I don’t know if that’s really what I quantify as success in business, but for me, I love these things.

Steve Ekstrom (19:25):

It’s funny that you say that because I think travelers and people who work in tourism share something, and that we’re lifelong learners. And there’s a wonderful quote that I heard not too long ago, and it was when one person teaches, two people learn. And being an entrepreneur, being somebody who likes to learn, who likes to experience new things and being able to share that with other people, I think is something that a lot of us find joy in, even if we’re not able to define what that is. Would you agree?

Mark Ross-Smith (20:03):

Yeah, totally. 100%. I love that. You just see it when you share photos online and stuff of your travels, people see it, people like it, they comment. And even just sharing these kind of photos online… Even thinking travel blogs and stuff. They’ll put, “Did this through the airport and went here in this hotel.” And you sort of look at it and go, “I can imagine myself there,” or, “I wouldn’t go there.” And I think that is educating people as well. Because when you know what you don’t like and know what you do like, and you kind of sift through these things and you get an idea of, well, actually I think I like beach destinations and not rainforests, or whatever it is. Because if this teaching or sharing travel wasn’t out there, how would you know where to go?

(20:55)
If you think back in the day, when I say back in the day, I mean back in my early days, ’90s, everything was in magazines and newspapers. And I remember as a kid, my parents would get these business magazines and there’d always be airline advertisements in these magazines. And I would open the magazine when it arrived. I’d tear out the pages that had airline ads in them and I’d put them on my wall. I was like 12 years old. Put them my wall in my bedroom. My bedroom was plastered with these airline ads. But they’re always beautiful beaches with the planes soaring in the background and the sun setting. They’re just these perfect images and I love that.

(21:35)
Actually, funny story. You know Siemens, the German conglomerate?

Steve Ekstrom (21:42):

Yeah.

Mark Ross-Smith (21:43):

They used to have a lot of ads in these magazines, all about powering the future and stuff, but they always had aircraft in it. I don’t know why. There’s always airlines and jet engines and stuff like that, and I thought they were an airline. I thought that. So I actually wrote a letter. It was in the ’90s, as a kid. Wrote a letter to them and said, “Never heard of your airline. Could I perhaps get a copy of your timetable?” Because I was collecting timetables at the time. You know the big thick paper books that they were printing at time?

Steve Ekstrom (22:13):

Yeah.

Mark Ross-Smith (22:13):

Asked for a timetable. Needless to say, I didn’t hear back from them. But they didn’t have any more jet engine and airline ads in a magazine after that.

Steve Ekstrom (22:25):

That’s funny. So what is the earliest travel memory that you have?

Mark Ross-Smith (22:42):

This family trip we were doing to going to Disneyland from Australia, traveling from Australia. We were on Air New Zealand. I remember very clearly, it was 747-200A, maybe, 100 or 200. It was a stopover from Auckland to I think it was Tahiti, I think it was at the time. I remember the kids’ packs on board. You know the little things they give the kids on board? I remember those and I remember the boiled lollies that they would come and give before takeoff and landing, because ears and the air pressure and stuff like that. I have very fond memories of that. And the other fond memory I had is, I think it was on that trip actually, I used to collect the model…

(23:21)
You know the die-cast metal planes? The model planes as a kid. And I’d bring them with me everywhere. It was like my security blanket. So I was about five, six years old. So in my bag, I’d have all these die-cast metal models. And when you go through security, they kind of look and go, “What the heck is this bunch of metal mesh in your bag?” No, I have fond memories of playing with my little jet planes on the planes as we flew, eating all these candies on board. That really got me into all this, I think. So I was kind of destined for this from a young age, I think, to be in the industry. But I had very fond memories of that.

Steve Ekstrom (24:06):

If you could change something about travel or the travel industry or the way people experience travel, what would you change, aside from matching status?

Mark Ross-Smith (24:22):

I would give Status Match to every single human being on the planet, and they’d be 100 bucks each. I think with the rise of low-cost airlines the last few decades, I like that because it made travel more accessible to more people. And I feel that when people travel more, to your point, it kind of rewires your brain a little bit. You see different countries, different cultures, just different stuff. You bring that different thinking back to your hometown, and there’s something just a little bit different in your mind moving forward, the way you approach things. Also, more tolerant to other cultures, more… Tolerant’s probably the wrong word. More open to things. Not so close-minded. I almost think that everyone’s going to be forced to travel at some point, not just [inaudible 00:25:35]. Maybe it’s like a rite of passage. Maybe when you turn 18, if you haven’t traveled, the government says, “Here’s your passport. Here’s your one-way ticket to Germany for a month,” or something, force you into it.

(25:48)
I think it would help with cultures and stuff like that. Obviously, I live in Malaysia and Malaysia is very diverse. There’s three or four different groups of people, Chinese, the local Malays, and there’s Indian as well, culture. And it’s almost like thirds in the country. Get on really, really well together. Works out. There’s no issues. Everyone enjoys everyone else’s public holidays. So there’s 50 something a year. It’s quite good for everyone. So what would I change? I think travel industry does a pretty good job at this already of making it easy and accessible for people to get out there. I would like to see even more people get out there and jump on a plane for the first time, especially the last couple of years, a lot of people haven’t traveled, or have put off that travel. I think now’s the time to do it. Go out there, see the world while you can. We’re not getting any younger.

Steve Ekstrom (26:46):

How would you like other people to describe you?

Mark Ross-Smith (26:52):

Me? Innovative, probably is what I hear a lot, or entrepreneurial, new-thinking. I had a post just on LinkedIn yesterday about this and how are airlines innovative anymore? Sort of go through a big list. So anyone listening to this, go check out my LinkedIn and check that post out. Pretty provocative. I like new ideas. I like new ideas. I like seeing those new ideas transpire in the world. I like seeing people benefit from those things, and just firmly in the travel business here and moving that industry forward because it can be pretty slow. Airlines are, dinosaur’s probably a good word, at times. But they can be super nimble and agile. They can do things really fast. And so I’d see myself as someone that’s sort of out there, just talking about all these great things that airlines and travel industry could do. So innovative is probably a good word.

Steve Ekstrom (28:04):

But if folks want to learn more and want to match their status or work with you to create a program to drive high-spending customers to their destination, where would they go?

Mark Ross-Smith (28:15):

Correct answer, Stephen. So when you get a Status Match, assume you have status with an airline, you get to try something new, something you wouldn’t otherwise ever try. It’s great for the airline, it’s great for you. Everyone wins in these situations. So obviously, statusmatch.com, if you have a status, register there, it’s free. For anyone that wants to add me to LinkedIn, I’m pretty active on there. And I always talk about thought leadership and travel and what’s happening and all new, edgy ideas.

Steve Ekstrom (28:44):

Thank you for joining me here on the Tourism Academy’s Business Class podcast. I appreciate you, your time, and your insight.

Mark Ross-Smith (28:53):

Thanks, Stephen. It’s been a hoot.