Air Niugini’s New Loyalty Program: but why so long?
In 2005, The Economist magazine calculated that frequent flyer points were the second-biggest global currency after the US dollar…since then they have grown even more in popularity (Source: The Weekend Australian, Saturday August 22, 2009)
The world’s second biggest currency is about to come to Papua New Guinea when Air Niugini launches the country’s first-ever home-grown frequent flyer program.
The concept of frequent flyer programs was born in the 1980s in the United States. American Airlines was the first to launch a full-scale program. AAdvantage was launched in 1981 and is still going strong today. Also in 1981, Delta Airways (US) quickly followed the lead of American Airlines with their Sky Miles program, while across the Atlantic British Airways launched their Executive Club program.
Since the 1980s, the concept of frequent flyer programs has evolved into what we now call loyalty programs. It is about rewarding loyal customers as well as understanding and customizing marketing opportunities for customers.
The advent of the computer age has allowed marketers to understand and track their customers better – it is no longer just about demographics (broad population characteristics including age, sex and location), but also about psychographics (knowing what makes people tick, what they like, what they do not like and habits).
So why has it taken PNG so long to get into the airline loyalty program business?
There a few reasons. Air Nuigini is a very successful airline. It has proud, talented and dedicated employees, and as the national flag carrier it is a true PNG icon. The airline performs extremely well given the various challenges that confront it, day in and day out.
However, one area that the airline is keen to improve, like any forward-thinking company is its customer relations.
The development of Papua New Guinea as a consumer market, has rapidly accelerated in recent years, meaning that the market has become diversified and more sophisticated. There is now a rapidly growing and upwardly-mobile middle-class in PNG. That means a growing affluence, and more disposable income. And for an airline that means more people are flying, more often.
The only way to really understand the market is to quantify and qualify it through a highly sophisticated computer software program, and to do this Air Niugini has invested in a system called CRIS: an acronym for Customer Relationship Information System.
CRIS has come to Air Niugini through its Information Technology (IT) project partner Mercator.
Mercator is the IT division of one of the world’s most successful airlines Emirates, based in Dubai in the United Arab Emirates.
CRIS is a significant investment on the part of the Board of Air Niugini. When people think of airlines they think of aircraft. However there is just as much collateral and investment sitting in IT solution programs that assist the airline in maintaining control of everything from ticketing, boarding, cargo, scheduling to catering and crewing.
CRIS is a state of the art system. Air Niugini is fortunate to be entering the world of customer loyalty programs at a time when many lessons have already been learnt. The airline can proceed with some degree of confidence, knowing that someone, somewhere has already done the ‘hard yards’.
Air Niugini has a very capable and hard-working sales and marketing team that will provide the driving force behind the loyalty program. A series of awareness sessions was conducted with Air Niugini employees in early September. As well, a visiting team from Mercator have installed the CRIS program which has allowed further hands-on training for the Air Niugini sales team in particular.
Given that Air Niugini has the technology and the people to drive it, the real challenge comes in trying to adapt the model to the very unique market that is Papua New Guinea. So it is not just a case of imitation over innovation, it is a case of adaptation.
That is where local knowledge comes into play.
When I was doing background research on frequent flyer programs which is not hard to do, given the amazing research resources we now have at our fingertips via the internet, I did some “Googling” on airline programs…there are hundreds of them world-wide, just about every national airline has one.
I was surprised to learn that the name Destinations was not used by any airline, anywhere in the world. My local knowledge tells me that Papua New Guinea is a wonderful country, it is rich in culture and diversity. I learnt this because I created and produced the Happy Gardener series with Justin Tkatchenko when I was working as General Manager at PNG’s television network EMTV.
In twenty episodes we saw and recorded the diversity, the wonderful people, culture, fauna and flora.
PNG must have one of the most diverse range of travel Destinations than any country in the world, and most of them you can only access by air.
The one driving desire that has kept me focused on the task of launching Air Niugini’s loyalty program is that we may offer more opportunities for more people to see this wonderful country.
The other thing I know about Papua New Guinea is that its people have a wonderful sense of family, something that is now lost in many western countries.
For this reason, a unique feature of Air Niugini’s Destinations Loyalty Program is that we welcome and encourage our members to enroll as a family. Mum, Dad and the kids. They can all pool their points for a common goal – it might mean sending Mum back to the village to visit her own family, it might mean sending a child overseas for schooling. If we can assist families in this way then my level of job satisfaction goes to extreme.
The other thing about loyalty programs is that they are fun. The aim will be to give our Members a sense of belonging and to create unique opportunities. Our launch promotion for instance gives three lucky members the opportunity to win 100,000 points.
We will offer other member opportunities in months to come.
We also plan to announce partners in the loyalty program. Our partners will provide other opportunities for members to earn points, at the same time rewarding their own loyal customers.
The concept of loyalty programs will fly throughout Papua New Guinea off the back of Air Niugini and its partners. Our collective aim is to reward loyalty. The more you fly, the more you earn.
By Glenn Armstrong, Business Development Manager, Air Niugini