How to make the most of loyalty plans on travel portals

If you use the online option to book your flight or hotel, how do you choose your online travel agent (OTA)? Chances are that you are lured by the cheapest process and, perhaps, the user interface. You wouldn’t be too different from other users, who are equally brand agnostic when it comes to picking OTAs.

This is the reason it is so difficult for these portals to retain customers. According to a study by the global business consulting firm, Baines and Company, increasing customer retention by just 5% can hike a company’s profitability by 75%. Little wonder then that OTAs, who operate on slim profit margins, are going all out to retain customers and bagging eyeballs without launching a price war.

In this attempt, loyalty programmes have emerged as the weapon of choice among OTAs to move away from the system of conveyor belt customers. As Pratik Mazumder, head of marketing and strategic alliances at Yatra.com, puts it, “It is imperative to identify premium customers from the existing base and run a loyalty programme so that they can be targeted and cross-marketed, locking in their share of travel spends.”

While the benefits of such loyalty programmes are certainly worth your consideration, do not automatically reject OTAs that don’t boast one. This is because there are some excellent portals that offer a bang for your buck without having invested in a loyalty programme. Consider Goibibo.com. The portal, which has been boasting triple-digit growth since its launch in 2009, has deliberately stayed away from a dedicated loyalty programme. Says Ashish Kashyap, CEO, Goibibo.com: “For most loyalty programmes, the redemption rate is very low. At this stage, we believe we need a loyalty programme for every customer that offers value here and now, not something that has to be accumulated and redeemed at some point down the line.” This is the reason the portal has focused on upping the ante in operational efficiency and customer care, from promising the fastest refund rate in the market—under two hours in most cases—to special concierge services.
As for the portals offering loyalty programmes, here are some of the most interesting ones available to the Indian travellers.

Yatra Miles by Yatra.com

With each successful flight and hotel booking—cancelled ones are not eligible—you earn a certain number of Yatra miles, which are valid for a year. According to Mazumder, the programme has recorded a traffic of close to 1.8 million members since its launch in 2008. Once you have collected a minimum of 1,000 miles, you can choose to redeem them for Yatra.com Promotion Codes, which fetch discounts on various travel products on the website. For every 100 miles, you get Rs 16, so 8,000 miles—the maximum you can redeem at a time—will get you a promotional code worth Rs 1,280. Given that the programme also allows you to earn miles on bookings done for others from your ID, your account balance can swell up pretty quickly. In addition, the portal has set up a separate segment within Yatra Miles for its top-end customers. It’s called the Platinum circle and one can bag free goods like headphones, Bluetooth headsets and travel bags, etc.

What’s hot

Customers automatically become a member of this programme on making a confirmed flight or domestic hotel booking from the website. No time is wasted on a sign-up form.

What’s not

The promotion codes are applicable only on the basic fare/tariff, not on taxes. Also, in case you avail of the discount on a product where the base fare is less than the value of the coupon, you will have to forfeit the balance amount. So you have to do the math carefully during the redemption process.

My Trip rewards by Makemytrip.com

Launched in association with PAYBACK in September 2011, this two-tier programme is by invitation only. To be a Elite member, one would have to make over 10 transactions, and for a Royale member, the transactions would be 15, while the value of transactions would vary from Rs 25,001 to over Rs 1 lakh, depending on the travel product purchased. Members can then start earning and redeeming reward points on all transactions on MakeMyTrip.com as well as other PAYBACK partners like HPCL, Big Bazaar and Pantaloons. For every Rs 200 spent on the base amount (excluding tax, fee), Elite members earn one point for domestic flight and bus bookings, four points for hotel stays and domestic holidays, and six points for foreign holidays. The ratio for Royale members is 2:6:8. Members are also entitled to benefits like priority service and early bird offers.