The airline market’s profits dropped 33% in Q2 of 2024, amid an increase in labor costs and jet fuel prices. These market conditions are forcing airlines to look at how they can maintain profitability, coming in the form of cutting routes, grounding planes, and finding ways to increase efficiency. Smart airlines are leveraging their loyalty programs to cultivate new revenue streams and achieve their business objectives.

One leading global aviation company with a successful loyalty program knew that in order to maintain its market leadership, it had to reinvent its hotel offering to keep customers engaged. They turned to Rocket Travel by Agoda to create a redefined hotel booking experience with new features like SSO, tiered loyalty earning potential, and innovative marketing that delivered a 53% increase in travel spend across hotel and car in its first year.

The US-based airline had recently redesigned its loyalty program to deliver richer rewards and  further incentivize loyalty behavior with its most engaged customer tier. 

Because of these changes, the hotel platform desired to: 

• Create a more rewarding experience with customers earning miles on all hotel reservations.
• Highlight the ways in which highly-engaged customers can achieve a higher earning potential by offering a differentiated experience by cardmember status level. 
• Encourage customers to become members, utilizing the platform as an incentive to offer further reward and redemption opportunities and drive increased engagement.
• Be able to accommodate experiments and changes in branding and messaging. 

The goal was to improve the customer’s entire experience; for Rocket Travel by Agoda, it was critical for us to build a single platform that was intuitive to the customer and made booking seamless. 

In short: Our partner needed a new hotel solution that would allow for more customization to fully showcase their brand and deliver a personalized customer experience with a tiered value proposition. 

After understanding what was important to the partner and how to achieve their business goals, Rocket Travel by Agoda developed a single unified platform to deliver a streamlined customer experience and customized economic factors that paid off the value propositions of the airline loyalty program. 

The new platform delivers:

• Earn and burn booking options in a single purchase funnel.
• Single sign on (matching the customer’s user ID and login with airline). 
• Differentiated value proposition based on customer type (for example, providing deeper rewards to highly-engaged customers who are cobrand credit cardmembers and also have tier status).
• Innovative lifecycle marketing that keeps customers engaged and properly represents the airline brand while driving revenue.

The new platform launch was a resounding success. 

The platform has seen improvements in net conversion rates, cancellation rates, and growth across the board. Not only are customers getting a seamless experience, they also are further rewarded for their loyalty if booking with specific cards. 

• Travel spend driven by hotel and car bookings has increased 53% since launch.
• Customers have a seamless experience, and are more engaged. Cardmembers with status have increased their share of bookings 10% from July 2023 to February 2024.
• Conversion rates have doubled from March 2022 to March 2024. 
• Cancellation rates have dropped by nearly 10% over a two-year period, meaning customers are completing more bookings, helping support revenue growth for the program as a whole.

Our partner also is seeing greater profitability as a result, generating 65% more revenue per booking on this new platform and an increase of bookings (up 37% year over year). 

While the aviation industry is facing increasing costs that are affecting profits, our partner has leveraged their updated hotel booking platform to diversify its revenue streams and keep customers engaged with the brand. The future is bright, and our team is working with the partner to continue expanding on our success by exploring new marketing strategies and technology initiatives that are forecasted to drive a 7% increase in revenue in the next quarter.