In a bid to increase customer loyalty, both Cruise Planners and Liberty Travel recently introduced client-facing rewards programs involving merchandise, moves that some believe will become a trend within the agency community.
"We've been looking for this for awhile," said Theresa Scalzitti, senior vice president of sales and marketing for Cruise Planners. "I'm sure people are going to be trying to figure out what we've done and how they can replicate it."
Cruise Planners Rewards, announced at the company's recent convention, will launch at the end of the first quarter of 2020. The program is free for its agency network and the agencies' clients. Clients receive points for travel they book, which can be redeemed via an online portal to get up to 60% savings on name-brand merchandise.
For example, Scalzitti said, if a client were to book a vacation with a Cruise Planners agency totaling $5,000, they would get 10% of that back in Cruise Planners Rewards points. The points could be applied to merchandise such as housewares, electronics, furniture, wine, gift cards and luggage.
A third party will fulfill merchandise orders and distribution. None of the merchandise is Cruise Planners-branded.
Scalzitti said Cruise Planners had been looking for a loyalty program for some time to help with retention and the acquisition of new clients.
"We realize that in this day and age it's super important, and we just want to give our Cruise Planners agents another leg up from the competition and to have that competitive edge in the marketplace," she said. "It also gives them a nice competitive edge when they're competing against some other companies that are giving back -- rebating -- a lot of their commission."
Cruise Planners will directly market the program to its agencies' clients, encouraging them to register.
Liberty's rewards program operates differently. For an annual fee of $79, Liberty clients gain access to an online portal where they can shop for a range of merchandise, such as electronics, accessories, lifestyle products and wine, according to senior vice president Christina Pedroni. For every dollar spent, points are accrued that can be turned into a gift card for Liberty Travel (the only Liberty-branded item involved in the program).
Pedroni said Liberty, like Cruise Planners, has been exploring loyalty program options for several years to reward loyal customers and create relationships with new customers.
"We also knew that based on the frequency our customers purchase directly from us, which is, on average, once a year, we needed something unique and different from the typical travel industry loyalty programs," she said.
Pedroni does not believe that the $79 annual fee will be a deterrent, based on the more than 10,000 products available and on how many points members can accrue. Some who signed up in the first week have earned triple their initial fee with the number of points they've gained, she said. She also pointed to other businesses that carry annual fees that haven't proven to be prohibitive, such as the Costco and BJ's wholesale clubs.
Liberty's program, managed and powered by partner International Cruise and Excursions, offers free shipping on most merchandise and a best-price guarantee.
It launched with Black Friday deals, which Pedroni said helped create some buzz for customers to join. Liberty's travel advisors will also share information about the rewards program with clients. With initial responses "very positive," Liberty is aiming to reach 5,000 members within the program's first 100 days.
Virtuoso for several years has offered a program, Virtuoso Reserve, which recognizes the top 3% of its clients based on their luxury-travel spend. The travel advisor and a partner create a bespoke experience designed just for that client. They aren't free, Virtuoso said, but are "rather a way to provide the highest level of service and customization to recognize these clients."
Travel Leaders Group believes its Apex program, a collaboration with American Express, is a partnership "with one of the most powerful loyalty programs in the world," said Stephen McGillivray, chief marketing and communications officer. "That is very much our way of building customer loyalty for our advisors."
Apex enables trained Travel Leaders agents to redeem American Express Membership Rewards points for clients while retaining their standard commission. Advisors are also able to earn incentives for clients they refer for an eligible credit card and give card members access to the Travel Collection, Apex's client-facing portfolio of offers and promotions.
McGillivray believes loyalty is an important area for agencies.
"It's economically a much better value proposition to secure and retain a customer than it is to go back out and fish in the deep pond to try to secure a new customer," he said.