Technology Rethink Needed for next Generation Loyalty Programmes

Even though the number of passengers on commercial flights is expected to hit 3.6 billion in 2016 and every forecast sees ever greater demand for air travel in the years ahead, airlines are facing fierce competition for business.

Since the 1980s, airlines have tried to entice and keep hold of their most frequent flyers with loyalty programmes which reward repeat business.

But through the years, the biggest and most successful frequent flyer programmes have evolved from cost centres into powerful marketing initiatives that allow carriers to collect valuable information about their customers.

Many frequent flyer programmes are now becoming profit centres and, at the same time, are needing to evolve so that they can better cater for the needs of members and partners in the scheme.

Global technology company Hewlett Packard Enterprise (HPE), which has a team that specialises in travel and transportation solutions, says these new demands on loyalty programmes are going to require companies to rethink the technology that powers them.

To help travel companies to better adapt their programmes, HPE has joined forces with Loyalty Partner Solutions, a subsidiary of American Express that develops and implements systems based on its Loyalty Management Suite (LMS) software.

“Being able to work with partner companies is key to making loyalty programs profitable,” said Lucia Gerber, industry consultant at HPE. “Our solution is made to include airline and non-airline partners. This benefits the owner as well as the members of the programme.”

After a competitive tender, HPE and LPS have just secured a major deal to provide a new IT platform to support China Southern Airlines’ Sky Pearl programme. The carrier, with 100 million passengers a year, is Asia’s biggest airline and the fifth largest in the world.

LPS is supplying the software and a project team which will advise China Southern on the optimal configuration of the software to meet its requirements. HPE, meanwhile, will be responsible for integrating the software into the existing IT architecture and migrating data.

China Southern’s Sky Pearl programme has more than 26 million members and the number is soaring with the growth of the airline.

“The rapid pace of market growth and our company’s plans for expansion make it necessary to upgrade to a modern software solution,” said Mr Wu, senior vice president in the marketing division at China Southern Airlines.

“We are convinced that with the new platform we will have our ambitious tasks fully under control in the future. We found the performance of the Loyalty Management Suite from LPS and HPE’s competence in the airline business to be a compelling proposition.”

Bruce Dahlgren, managing director of HPE Asia Pacific and Japan said: “Airlines are under pressure to not only adapt to new business and distribution models, but also the needs of travellers expecting more personalised, always-on experiences.

“China Southern Airlines is using IT to transform its business and provide a more tailored, customer-centric service to passengers.”



john buttersJohn Butters has more than 20 years’ experience of writing about technology and aviation. He has edited news-stand technology magazines and has contributed to newspapers including the Daily Telegraph. Today, he mainly writes about the benefits that IT delivers to end-user customers and how aerospace technologies are improving safety and efficiency for commercial and military aircraft operators.