Over the past year, many airline loyalty programmes have been trimming benefits, even for their frequent flyers. But JetBlue’s TrueBlue programme and Virgin America’s Elevate programme are taking a different course. Both loyalty schemes this year established elite tiers, offering their best, most valued customers additional benefits while travelling.
TrueBlue and Elevate are spend-based programmes rather than distance-based. Customers qualify for additional benefits based on how much they spend on tickets. JetBlue’s new elite level, called “Mosaic”, requires an annual spend of $5,000 (which equates to 15,000 base points) or 30 one-way trips with a spend of $4,000. Base points are the three points that passengers can earn on the base fare of each JetBlue flight purchased.
Virgin America, meanwhile, has added two new status tiers to its Elevate loyalty programme – Silver Elite can be achieved after spending $4,000 (which equates to 20,000 points), whilst Gold Elite requires $10,000 in spend. Virgin America also allows for partial qualification for passengers who use a co-branded credit card, a common feature shared with many legacy reward programmes.
TrueBlue Mosaic and the Elevate Elite status levels offer similar perks to those offered by other loyalty programmes. These include access to dedicated phone representatives, priority security checkpoints, free checked bags and boarding priority at the gate. Members will also earn extra points on their travel, up to a 100% bonus on base points depending on which tier they qualify for. The Elevate elite programme includes complimentary, space-available access to Virgin America’s “Main Cabin Select” seats (more legroom and complimentary food and alcoholic beverages) and priority access to last-minute, discounted first class upgrades. Mosaic members receive six complimentary upgrades to “Even More Space”, JetBlue’s seats with more legroom.
So why are these two airlines bucking the industry trend? For Dave Canty, JetBlue’s director of loyalty, the Mosaic programme represents a natural progression, not a reaction to the other frequent-flyer programmes while also avoiding a copycat approach. Says Canty, “Mosaic allows us to recognise those customers who fly with us the most with meaningful benefits. We didn’t want to introduce something that requires you to check a board at the gate to figure out if it is your lucky day and you get to sit in front of a curtain, or just behind it. We want to consistently deliver a great experience and TrueBlue and TrueBlue Mosaic helps us accomplish that.”
Airlines are focusing more on high-value customers than just on frequent customers. These two new elite levels focused on annual revenue rather than just miles flown suggest this trend in the industry is accelerating. The legacy programmes are making similar moves, too, but not quite as aggressively. This bodes well for high-value customers; for those who have been in the margins and benefiting disproportionally, however, the outlook is rather grim. This transition to revenue-focused loyalty will take some time, but the stage is set.
September 6, 2012 at 3:37 am
If I were building a frequent flyer program from scratch, this is partly the direction I’d go. Rewards would be based on dollars spent (which has the nice side effect of eliminating the taxation issue in the US; this clearly is a return of premium paid). Status would be based on the number of one-way trips. Not segments, mind you, but trips. Most people have a choice of airlines to take, and the idea is to get them to choose yours.