Confusing frequent flyer programs have fewer satisfied customers – study

Roughly half of airline loyalty program members do not understand how to earn or redeem their points or miles, according to the just-released J.D. Power 2018 Airline Loyalty Program Satisfaction Study.

That’s bad news for the airlines because understanding how to redeem and earn rewards are among the most powerful drivers of customer satisfaction with airline loyalty programs.

“Airlines have worked hard over the past several years to demonstrate the value of their loyalty programs, particularly to general members,” Michael Taylor, Travel Practice Lead at J.D. Power, said. “While those efforts are paying off in the form of improved overall satisfaction scores, airlines have a huge opportunity to improve when it comes to customers’ ease of understanding the rewards program.”

The 2018 Airline Loyalty Program Satisfaction Study surveyed over 3,000 airline loyalty program members, and measured their satisfaction with airline rewards and loyalty programs based on four factors. In order of importance, they were: earning and redeeming rewards; program benefits; account management; and member communication.

JetBlue’s (NASDAQ:JBLU) TrueBlue loyalty program was rated the best among the nation’s airlines in member satisfaction. The program earned 812 points on Power’s 1,000-point scale, performing well in earning and redeeming rewards; program benefits; and member communication.

Other carriers that can boast of satisfied members include Southwest Airlines (NYSE:LUV), whose Rapid Rewards program ranked second with 798 points and Alaska Airlines (NYSE:ALK), whose Mileage Plan ranked third at 791 points.

The study uncovered some key findings that airlines would do well to embrace if they want to enhance customer satisfaction with their programs.

  • Confusing program details negatively affect satisfaction: Airline loyalty program member satisfaction climbs 123 points on Power’s 1,000-point scale when members understand how to redeem points and 131 points when they understand how to earn points. Yet, half of general loyalty program members say they do not completely understand how their program works and, among status members, 30 percent say they do not completely understand their program.

  • General member satisfaction improving faster than status member satisfaction: Both general and status membership satisfaction levels have improved year over year, but general member satisfaction is improving faster, driven by improvements in the earning and redeeming rewards and program benefits factors.

  • Say my name: Overall satisfaction scores increase 120 points among status members and 78 points among general members when their name is used by airline staff or when their preferences are recognized.

  • Increased mobile app use associated with higher satisfaction: Nearly half (46 percent) of loyalty program members say they have the program’s mobile app on their phone or tablet, but less than half of those say they use it. Among members who have the app, satisfaction is significantly higher when they use the app frequently.

  • We are a nation of points hoarders: Nearly three-fourths (74 percent) of airline loyalty program members prefer to save their points/miles to redeem larger rewards, while 13 percent prefer to redeem their points for quick discounts.

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