Welcome to Travel Buddy,
presented by Switchfly.
In this podcast, we talk about all
things travel, rewards, and loyalty.
Let's get to it.
Brandon Giella: Hello and
welcome back to another episode
of the travel buddy podcast.
I have with me today as ever
Rachel Sattow, thank you for
joining us and James Houchin.
Welcome back to the show James.
You have a I don't know what you call
it, but a funny little sound machine.
Can you play it?
Can you play a sound for us?
James Houchin: I mean,
Brandon Giella: Yeah
This is so fun.
Uh, thank you.
I'm so excited to incorporate more
media into this podcast if we can.
Uh, okay.
So thank you for joining me today again.
So we are talking about the impact of
loyalty programs on business performance.
So we have talked a lot about loyalty
programs and personalization and
things like that in previous episodes.
And so today we're going to
be digging into a little bit
more on how that affects.
Uh, the actual, you know,
business results, KPIs, ROIs,
and all those acronyms that
you learn in business school.
So, uh, but before we get there, I'm
going to turn it over to you guys.
James, I'll start with you.
Can you give us a little bit of a
lay of the land in terms of loyalty?
When we talk about loyalty programs
or customer loyalty, especially as
Switchfly sees it, what would you say?
How would you describe that?
What are the different tiers
or mechanics when it comes to
loyalty from your perspective?
James Houchin: For sure.
So, you know, there's a
couple different flavors.
Um, if you want to kind of have
ice cream analogies, um, it's
a little after breakfast while
we're filming and I'm hungry.
Um, but if you have your more vanilla
or the more transactional where really a
lot of this started out, it was just, you
know, the more you partner with a brand
in terms of, you know, me going to Chick
fil a once a week, you accrue points.
It gets me to come back
for, you know, Bye.
You That free coffee or whatever that,
you know more transactional based reward
is and it it's a great relationship,
you know helps me um increase My usage
of their products they get higher sales
um, obviously, you know, you You get
all these micro conversions whether
it's even just getting me to download
an app And they're able to in a very
cost effective way Um, and then from
there, you have, you move up the value
ladder to, um, more aspirational type
relationships where, you know, my Uber
point and partnerships were like by Uber
points, uh, or sorry, my Uber spend when
I go to an airport can accrue my SkyMiles
account, et cetera, where you get some
of these brand crossovers and there's,
um, synergies, but it's still a more
transactional relationship and then from
there you get into much more, um, yeah.
Kind of I call it a walled garden kind
of like using iOS where there's a ton you
can do Within an ecosystem thinking of
like your credit card reward points, right
where I may not directly spend money with
my bank And the actual, you know credit
card swipes, but through the transactional
value They're generating a ton of revenue
off their user install base And that's
really where we can start to explore.
What else can we do?
Um, does that mean Status accruals
and access to an airport lounge.
Does that mean?
Um, you know these more aspirational
rewards where a switchfly would come
in and we're able to power, you know
Travel getaways based on points accrual
and that's really where um The more
progressive and the more innovative
brands are kind of doing a bit of all
of the above where, you know, you're
going to have that transactional point
accrual based on, you know, how much
you spend with a brand, but then there's
all these other options with, you know,
cross promotion with adjacent logos, as
well as, you know, things that are just
there to delight the customer where,
you know, you get a bag tag based on
status and you get to, you know, kind
of flex that you're a brand loyalist.
Um, in a way that, you know, everyone
gets that win, um, but definitely it goes
above and beyond just that basic, you
know, Hey, Brandon, I sell coffee every
time you spend 5, I'll punch your card.
Brandon Giella: Yeah, I, I, I think
everybody understands the, uh, the Chick
fil A or Starbucks kind of like points
accrual, but I like what you said about
the ecosystem or walled garden idea,
because I guess what, where I go is I'm
thinking of American express platinum.
I'm a card holder, big fan
because I get all these benefits.
Like I get 200 a year on, um,
like entertainment credit.
So I get like free audible
books and things like that.
And it makes me feel like.
I'm connected as like a member and i'm
i'm like glad to be a card holder because
I get all this great stuff but then
to your point you get all these added
benefits of being like a I'm a gold
member with like a bunch of different
rental car companies and hotels and so I
get free upgrades or I get I'm going to
london in a couple of weeks and I get a
hundred dollars worth of Um, breakfast
at this hotel that I'm staying at
because I'm a card holder and it makes
me feel like I should be very loyal to
American Express because they are helping
me so much enjoy the luxurious life.
So anyway, uh, so that's,
that's where my mind goes.
Uh, so Rachel, I want to bring you in,
um, give, can you give any other color
on how you see, uh, loyalty as well,
or any kind of personal examples that
you might have the way you use it?
Rachel Satow: No, I think
your example of Amex is great.
Um, the way I really see
loyalty is it, it is a flywheel.
So it will, you know, you have one
person who becomes loyal to your brand,
and as you just did, that person is
now telling somebody else about it.
And
it, when we think about the idea of
business performance and how it can
actually affect your bottom line,
that's where the bread and butter
is, because that loyalty spreads.
not just with that individual, but
all of the individual's connections
because they want to brag about it.
They want to
say, Oh, this is my
experience that I've had.
I've loved it.
And then all of a sudden you're getting
all of that referral information.
So that's how I view loyalty.
It's much softer than the, than the
transactional or like the actual, um, you
know, mechanics of the loyalty program,
but I see it as more of a relationship.
Yep.
Brandon Giella: a celebrity and
I want other people to feel like
a celebrity as well, you know?
And I want to tell them I'm important
in, in the eyes of American Express.
You know?
Rachel Satow: Exactly.
Brandon Giella: I love that
James Houchin: and really, that's
what's so cool about loyalty is just a
concept overall is you get both right?
And really, we're switchfly tries to, um,
help our partners get even more, um, Juice
out of that squeeze is the aspirational
side where hey, I got this amazing trip
So whether it's a honeymoon or just a
weekend getaway You know The brand is
also able to be part of that story in a
way that I'm not bragging about like my
points were like hey Brandon, I got a 1.
5 X point return on gas
stations this quarter.
No, no one cared like Don't post that.
Um, but you know, hey, I was
able to get a free flight to Paris
Through, you know, my credit card program,
that's really the aspirational, plus
the transactional, plus, um, just that
tiered loyalty status accrual as well,
right, where you're getting a ton of
value for a bunch of brands and a bunch
of different avenues, and in a way that
doesn't cost them an arm and a leg to get
you to come back, you know, we're talking
about, we're talking about pennies on
the dollar versus all the effort and work
that these brands have to do to get that
first time you in the door the first time.
Right, you already
got James, Brandon, or
Rachel through the door.
How do you keep me coming back?
You know, usually it starts with the
transactional and then quickly moves
up the value ladder the more someone's
willing to engage with the brand.
Brandon Giella: That's right.
That's right.
Yeah.
So to bring back the business
performance, uh, acronyms, it increases
customer lifetime value CLV over time.
And then it also, uh, it reduces your
CAC, your customer acquisition costs
over time because you're, you're able
to retain those people and reduce
your churn and things like that.
That's, that's the goal.
There's, there's a lot of, um, There's a
lot of data to support that, which we'll
get into in a second, because you guys
have a great infographic on this topic.
But before we get there, uh, so, uh,
another component of what is very helpful
about all these loyalty programs in this
kind of ecosystem or world that we've been
describing here is that it produces a lot
of data that you have on your customers.
And so because of that.
Thanks to a lot more advanced technology,
even a lot of AI tools that are coming
out and have been out for the last 20
years, but you know, are still getting
refined is that you can create a lot
more personal offerings, feeling like
you actually do know your customers
because you have this data on them.
So it's a win for the business because
they can, uh, create better, you know,
market segmentation customer, you know,
understand the customer a lot better
and provide a lot more value to them.
But then also the customer feels
like, wow, they really know me.
They're offering things to me that I
actually do want because they know me.
Um, so there, and there's a lot of, you
know, there's privacy things all in there.
There's a lot of topics
that you can cover.
But, um, how do you guys.
See, and James, I'll start with you again.
Uh, how do you guys see personalization
in the midst of this ecosystem of loyalty?
Um, how do you view that?
How can, how have you seen businesses
use that data to create really like
personalized offers or refine the way
that they're doing their marketing?
Uh, yeah.
So I'll let you speak
to that a little bit.
James Houchin: I think keep it
simple stupid is what comes to mind
where you know elegantly relevant
or timely offers are amazing
But it can quickly cross the threshold
of being creepy or annoying Um,
if not, um, you know, and it, it
really is, relies heavily upon the
brand to intelligently implement
kind of that balancing act where,
you know, Hey, James flies
out of the Southeast.
There's a specific number of airports,
um, that he's going to look at
that impacts routes that impacts,
you know, whatever, um, same with
my Amazon recommendations, right?
And the signal to noise ratio is
really what the brands need to focus on
where you're delivering based on past
experiences and you can apply an AI model
or just, you know, simple, you know,
kind of detective work, um, to be able to
say, you know, Hey, James, James bought
a 3d printer is probably going to buy
filament or, um, if you're a normal human
being, James bought a bunch of cooking
tool, like a new pots and pats that
maybe need some utensils or Tupperware.
Um, and that's really where, you know, it
can be intelligently implemented versus,
you know, hey, you went to this hotel
once in London, haven't been back in five
years, here's an offer, um, which is kind
of where it's like, yeah, you're just
spring and praying and end of the day,
short answer is you really just need to
balance relevant and timely, um, with some
just good, you know, um, Um, Level of gut
check or data to balance, to balance the
two because there's two extremes and both
can be, um, a bit unpleasant for the user.
Brandon Giella: Rachel, any, any
other thoughts on, on, uh, how
you're seeing personalization?
Do you have an example of, of maybe
something that is, that has, uh, you,
you got this kind of offer this ad or
a newsletter or something and you're
like, actually, that is very helpful.
Rachel Satow: Um, personally, yeah, I
mean, you're talking to two marketers, so
we live in, in the, in the first party,
third party data world all the time.
Um, and you know, from a loyalty program
perspective, there's, you know, so
many different ways that individuals
are providing you with loyalty, um,
and providing you with that data.
So you've got your customer profiles
when they're filling it out.
You know, you, they're providing you
with some demographic data, and you know,
then you move into like the purchase
history, and you know, if you allow them
to set some preferences, like there's
all of that data that they're already
providing you just as a part of your
program, but then when they go into it
further, there's transactional data,
so like I personally am an REI member,
I love REI, and they, their program, I
love when they send out their emails,
because my significant other is also a
member of their REI program, of the REI
program, and we get two different emails.
Completely different emails, and
it's because the way they are
tailoring it based on my purchase
history versus his purchase history.
And even just how frequently
both of us go into the store.
We live across town from our
REI, and he works right next to
it, so he's there all the time.
And so he'll get more of that
communication, whereas I'll get
it more specifically when there's
like deals that are happening
or something along those lines.
So, I think just timely communication
from a marketing perspective, that,
that's always going to be how you can
tap into your loyalty program data.
Um, but I also look at it from the
perspective of Non members versus members.
How much data are you getting?
And, you know, we talked
about our infographic.
That's one of the things that we
discovered was, you know, 34 percent of
businesses are saying that their loyalty
program members are providing them with
more insights than non members and just
individuals who are going to their store
and purchasing or, you know, making
those, those, those flight
purchases, et cetera.
When they're actually making those
transactions, more data is coming
from their loyalty program members.
And I think that's, when we think
about the grand scheme of, you know,
business value and learnings that you
can take away, that's an invaluable
asset from your loyalty program.
Brandon Giella: That's right.
That's right.
So I love the way that you brought
up REI and that there are two, you're
getting two different experiences
from a marketing perspective
related to that brand based on.
All that different behavior now to pull
that off is very difficult, you know
in a lot of ways You've got to know the
timing the frequency You've got to know
the kind of offers that they want Takes a
lot of work and I know you guys have has
spent a lot of work on that at switchfly
doing that in a travel perspective Um,
but what I love is You brought up the
infographic and this infographic, which
will include in the show notes, uh, there
is just a lot of, of survey data to say
that people will, you know, be frequenting
these, um, um, uh, businesses more often.
But also that there is actually like hard
data in the terms of they spend more.
So here's just a few, uh, little
nuggets from this infographic.
This is, uh, on a one section that says
what loyalty program members are saying.
And this is from the bond loyalty report.
And it says that 85 percent of
these members say that the programs
make me more likely to continue
doing business with brands.
So they feel much more affinity
toward the brands that they are.
Marketed to with with good data and
and these relevant timely offerings
And another 79 say I am more likely
to recommend brands with good loyalty
programs, which you just did with rei I
did with american express and james was
talking about, you know, the kind of chick
fil a perspective things like that but
then also There is a 56 percent higher
repeat purchase rate from members to non
members And there's also, um, six out of
10 consumers involved in loyalty programs
have more positive experiences with
these brands because they believe their
connection transcends a transactional.
Like what you're saying, they, like
your significant other actually gets
different emails and they feel like they
have a closer relationship to that brand.
So there's, there's the soft data
like polling and survey data.
And then there's really hard
data that says that these people
are actually spending more.
Turn goes down, customer acquisition
costs go down, spin goes up.
So it's really amazing if you can tap
into these programs and the power of them.
So I guess my question is, uh, what
kind of, uh, benefits or impact or
ROI or KPIs, all of the, the business
lingo that you guys are seeing on the.
Switchfly side of things
when it's related to travel.
What can you tell us about the way
that this is impacting either your
clients or you know, just the kind of
programs that you guys are building out.
So I want to talk more specifically
about Switchfly, but tell me a little bit
about what you're, you guys have going
on and what you're seeing on your end.
Rachel Satow: Yeah, I mean, I think
one of the things that we've, over
time, and we've talked a lot about
internally is just, for companies
that don't offer travel right now.
They, when they implement it,
their conversion rates and
the redemption rates go up.
Because this new offering, this
experiential rewards, um, it provides
them with something that's just
different than, you know, a gift card.
Um, and it is, when we go back to
the psychology of it all, people
are wanting those experiences.
You brought up Amex, and that
was a really great example.
You are loving the experience that
you're having with this brand, and
offering travel rewards, like you can
through Switchfly, is, is boosting
the conversion rates and those
redemption rates because people are
looking for that type of reward.
Brandon Giella: And it's not just, so
there's like gift cards and there's,
there's other ways that people provide.
loyalty to their, or kind of these
benefits to their customers or
employees and that sort of thing.
But, and you guys have a very specific,
uh, offering on experiences and travel
and as related to that, when they
build up, when employees or customers
build up these kind of points,
they can redeem them through your.
Platform toward travel and
not just toward a gift card or
marketplace or something like that.
And if you find a lot of clients, find
a lot of benefit out of that and their
clients and their employees find a
lot of benefit out of that as well.
Yeah.
James Houchin: fraught
with sticks and carrots.
In that when you have an awesome travel
experience, it's the first thing you'll
talk about and the last thing you'll shut
up about, but inversely, when you have a
bad experience, which travel is simpler,
more simple and more complex in 25 than
it was in 2015, um, you know, cause
the way it does the same thing, right?
Like we all could share our
terrible travel experience that
is forever branded into our mind.
Um, and that's really where, you know,
it's a huge opportunity for brands
that are willing to step out and be
different to land on a really amazing
user experience by having a simple direct
to book travel offering, um, really,
you know, the Switchfly sales pitch
of, you know, I think it was Expedia a
couple of years ago published a report
that there's over 30 site visits to
make a single trip booking, right?
When we think about all the
complexity and the research.
Um, Um, you know, not only do we
try to offer, you know, all the
inventory types you'd want to book.
Um, but I was just talking to some
of our product team last night about
how they continue to use Gen AI.
Um, as well as just simple little
product enhancements of like, what
neighborhoods do I want to stay in Berlin?
What activities might I want to partner
with when I'm looking at a safari?
You know, like all these small
little transactional lifts.
Um, where, you know, it's just a search
away, but it's so much more pleasant
to be able to just go bang, bang, boom.
Um, kind of like the difference
between an all inclusive versus an
a la carte, um, stay experience.
Again, we want to be as flexible,
um, to the traveler and their
diverse set of needs as possible.
But really the brands that take the
lift off the customer and try to
make it a more tailored experience
really are the ones that win.
Because all the data that says you're more
likely to increase your lifetime value.
You're more likely to come back
frequently based on appropriate
usage of rewards and loyalty.
The same data also says that, you
know, anyone on this podcast is going
to hop the moment they have one,
definitely two bad experiences where
there's certain airlines I just will
not get on their plane because, you
know, again, we're back to that, you
know, it's kind of the old, you know.
Um, one bad experience makes
up for three good ones.
Like, you know, it just evolutionarily,
we're wired a certain way.
And customer loyalty is not
immune to that pattern either.
Brandon Giella: Yeah, that's right.
That's right Yeah, it's um, I love
how you're talking about the the kind
of recommendation engine because that
is so key when you're planning travel
Um and and creating that kind of good
Experience that produces that kind of
loyalty that we've been talking about.
It is those little Call
them micro interactions.
You know, I'm searching for a trip
in Berlin or actually right now.
I'm searching for a London trip So
London and Oxford is where we're going
and we've got different family members.
We're meeting different people.
I've got a toddler and Trying to plan
this trip even with you know Chachi BT
and all these great tools that are out
there and Google search and read it
and all this it is really hard To make
sure that I've got all those details
lined up thinking about jet lag and
when I'm gonna be At this place and do
I need private transport or do I need
to get a bus or tickets to this and that
and there's just so much to explore.
It's a huge world and then
you get into paying for it.
Do I do points, cash, both?
It's, it's just a lot to think about.
And Rachel, I love, I love
your example last episode where
you talked about there's this.
Bike trail that you wouldn't have found.
Otherwise, if it weren't for this
recommendation engine to help
you understand where this was
and, and, uh, I just think that
kind of stuff is so powerful.
And so it does create that kind of
loyalty, even through good experiences.
I have nothing to do, quote unquote,
with a loyalty, you know, kind of
points or cash or gift cards, but
creating that good experience is a
part of creating that kind of loyalty.
Rachel Satow: Yeah, and You know, tying
it all back to business performance and
when you remove some of those friction
points, like you just mentioned, you
have so many different outlets for
being able to gather that research.
When we remove some of that friction
point by bringing it into the platform
and making it housed in the same places
that they would want to conduct their
booking, you're removing not only their
time and helping with Um, you know,
their, their investment of planning
this trip, but you're also, you know,
making it a smoother process and more
likely to book, like, instead of abandon.
So
definitely, definitely see the benefits
from just like a user perspective, but all
of that effort also enhances your bottom
Brandon Giella: That's right.
That's right.
Absolutely.
Yeah, because it does bring back
more, uh, cart purchases, if you
will, and repeat purchases over time.
So, in the middle, that one transaction,
you get a lot more bang for your buck.
And then over time, that customer
lifetime value, that's the argument
that you get a lot more repeat
purchases over time as well.
So, yeah, really amazing.
Okay.
So, uh, I want to dig in more to
the actual metrics of, uh, loyalty
and, and kind of, uh, again, the
impact on business performance.
So Rachel, I'll, I'll start with you.
What are you seeing and kind of the
metrics that you're seeing for, uh,
measuring this well and making sure
that your, your programs are performing
well in a business perspective.
Rachel Satow: Yeah, so there's
definitely the obvious ones.
You know, customer retention
rate, repeat purchase rate.
Are you seeing any upticks there?
You've mentioned CLV quite a bit.
Is your customer lifetime value going up?
Um, but there are also a few others that
you can, you can track along the way.
You know, certain platforms you
can, you know, use heat mapping to
showcase, like, are people clicking
on this button versus this button?
Is this color performing
versus this color performing?
So just tapping into, when we go back
to the data that they're providing,
there is definitely the opportunity for
you to just dive a little bit deeper
from, um, from that perspective and,
you know, all the while making sure
you're keeping a pulse on, on those,
you know, typical loyalty program rates.
Um, but you can also, you know,
dive into those even further.
Are people, you know, is the
average order value for, um, flights
going up versus when you have
packaging and dynamic packaging?
Are you increasing, you know,
your, your additional revenue
streams from that perspective?
Those are all things you should
be keeping a pulse on for sure.
Brandon Giella: I like that.
One other one I will mention as you
were talking I was thinking about we had
lunch with somebody a few weeks ago and
they have been a very very successful
entrepreneur and They said that don't
forget to surprise and delight And so
even though you've got your your kpis
and the things that you're trying to
get more efficient on and growing this
and that There's one part of loyalty.
That's really important.
It's just these little These little, you
know, boops, like surprise and delight.
And one that comes to mind is last
year I was in London and, uh, had a
hotel person give my little daughter,
she was a year old at the time,
give her a little stuffed dinosaur.
And I was like, oh, I
wasn't expecting that.
And I know it cost him
2 to get this thing.
But it's this thing that I remember.
That it was a nice little,
nice little delight.
James Houchin: for
sure even something as simple as like a
note card sitting on your seat when you're
getting on a flight or you know, like
the free whatever on your birthday like
those little moments can be incredibly
impactful and The ROI is probably
the hot if you're gonna have the
highest return on Spend whether
that's time money or something else
from those micro interactions oftentimes
Brandon Giella: that's right.
That's right.
It's actually a great book about that.
Uh, it's called moments that
matter if I remember correctly.
And there's like a lightning in a bottle
I think is on the cover by a Heath.
Last name of Heath.
I'll have to look it up.
I'll add it to the show notes.
Anyway, it's a great book.
Talks a lot about this kind of stuff.
I listened to it on a flight one time.
Well, I have to ask, do you
guys have any trips coming up?
Peace.
Mm
Rachel Satow: I'm taking a very, very
small weekend getaway, um, to Covington,
Georgia, which, you know, last week, um,
we talked about just, you know, going
off the beaten path as part of a trend
that we're seeing in 2025, um, this is
definitely not a destination, like a
big name destination, it's not New York
City, um, it is Covington, Georgia,
um, and, you know, when we talked about
last week as well, there's, um, um,
This surge in individuals wanting to do,
like, media based, whether it's, like,
scenes from the book or the movie that
they're, they're going for, um, we're
going because Covington is a really
big filming location, and we wanted
to see some of our favorite spots, so.
Brandon Giella: Oh, interesting.
Okay, cool.
I didn't know that.
I love that.
Oh,
James Houchin: though are some of the
coolest places you'll ever take a trip to.
Like, um, I'm not too far from where
they filmed The Walking Dead in Senoi.
You ask five people how to say that
town name and you'll get five answers.
But like it's
right around the corner and it always is
mind blowing when you're walking through
town like Where people are coming in from
it was also super creepy to walk through
town Back when they still had like the
steel walls up because it did legitimately
look like something was going on.
But um
You know, sometimes like the out
of the way spots are really the
gems of your travel experience
Brandon Giella: Well, Rachel, James,
thank you so much for joining me on this
episode again for The Travel Buddy where
we talk about loyalty, we talk about
travel, we talk about so many different
things and this is such a key component to
get More performance off of your loyalty
programs by surprising and delighting,
measuring what matters and creating
these really great moments, uh, for, uh,
great experiences for, for traveling.
And so I think it's so important
that you guys are doing this work
and I know there's all, it's a big
world, uh, but I really appreciate
the way that you guys are approaching
it and even building products to
serve your customers in this way.
So we will hopefully see you guys
again in the future and We'll
call us a wrap on episode 26.
Thank you.
See you guys