VFTW takes on what it calls "House of Lies'" study and recommendations regarding frequent flyer programs.
I'm torn.
VFTW asserts that
...the data in the study doesn’t suggest that loyalty programs are not working. They might not be, but the proof isn’t in their surveys.
On the one hand, I tend to agree with what VFTW spends a lot of time talking about
: Deloitte's justifications for the assertion that FF programs are failing are weak.
But on the other hand, I agree with the Green Dot that frequent flyer programs are failing. But I don't think the study really hit the 'why' factor. The Why imho is devaluation and an increasing lack of faith in the long-term stability of the benefits of elite and/or lifetime status and value of miles or points.
That said, although some of what they recommend is consultant gobbldy-gook, I think that Deloitte has some very interesting ways of reversing that trend. The best imho is 'Refocusing on individual customer preferences.'
I think it would be wonderful if, instead of eliminating or reducing a benefit, a program gave customers
options. If upgrades are important to you, then great, you get priority upgrade list. But of miles are important to you, here is a mileage bonus in lieu of your name being on the upgrade list. Forego RDM for an EQM bonus. I would love to see an airline where you can use a pick-and-choose menu to create a custom elite program based on each traveler's personal priorities and preferences.
And this advice from the Deloitte study is one of the smartest things I have read about loyalty programs: "Therefore, airlines with well-run operations and consistency of service are better positioned to strengthen their loyalty programs in a way that engenders emotional loyalty and avoids the deal-seeking transaction-based loyalty typical in the industry today."
VFTW concludes:
But even if they are failing, the data doesn’t suggest that “making rewards more personally meaningful” will materially move the needle on the metrics in the report. All they do is lay out a problem and say they can do better, they offer suggested paths but without evidence for the efficacy of those paths.
Ultimately this is a sales pitch for frequent flyer programs to bring in Deloitte’s House of Lies team. There are lots of things programs can do better — for their customers and for their bottom lines — but this document doesn’t suggest that Deloitte has special insight into what those things are.
I wish that VFTW had focused more on the proposed solutions rather than focusing so much on how Deloitte came to the conclusion that a problem exists, both analyzing Deloitte's proposed recommendations and perhaps using whatever special insight exists at VFTW to come up with better ones.