Introduction
Company loyalty programs keep growing in both established and emerging economies. Their rise has drawn investigation, with the principal goal of evaluating the initiatives’ attractiveness and efficacy as business advancement tools for the different firms that utilize them (De Jong et al., 2019). These programs are intended to foster consumer loyalty, which may be assessed by the frequency consumers prefer using the same provider or purchasing the same items. This paper covers the Emirates Airline Loyalty Programs while discussing other factors that impact the stability and longevity of the firm-customer engagement that occurs within the structure of such programs.
Emirates Airline Background
Emirates Airline was founded in March 1985 with the assistance of the royal household, who availed two of the firm’s first airplane. The firm is the national airline of the United Arab Emirates. Moreover, it is the largest global air carrier that is among the quickest expanding carriers in the world while seeking an aggressive infrastructure. The company flies with a fleet of wide – body equipment, and is the leading company of the Airbus A380 type of plane. Emirates maintains an extensive range of services inside the Arab World as well as to Africa, Southeast, the Pacific Ocean, Latin America, Europe, as well as South America from its gateway in Dubai. Emirates SkyCargo is the airline’s air cargo segment, supporting over 50 locations.
The Need for Customer Relationship Management at Emirates Airline
Airline client relationship management facilitates getting to know travelers and increasing their loyalty to a given business. Airline companies make it even easy for passengers to pick them up by simplifying the process of gathering passenger data as simply as possible. It is critical to create strong customer engagement to solve carriers’ present reputation with many clients. Incorporating airline relationships with customers might be beneficial. Emirates has created a reward scheme called The Emirate Skyward Program in this aspect.
The Airline’s Skyward plan is an award-winning effort designed to increase the quality of its operations to its most loyal clients. The organization has continually tried to simplify the service, and it has guaranteed that the service is constantly updated to fit evolving client demands. The key benefits of the Skyward program are the ability to earn and spend miles with a diverse set of partners (Sadik, 2018). Furthermore, consumers benefit from an improved travel experience as a result of flexibility and access to special offers not accessible in standard package deals. Clients may manage their mileage and customize their profiles. Followers of the scheme begin as blue-level members and work their way up through the ranks to platinum status. Start enjoying Silver, Gold, as well as Platinum affiliation perks for 14 months until returning to blue and accruing points once more (Sadik, 2018). One difficulty with loyalty programs is that they have so many collaborating firms that it might be challenging to distribute bonuses evenly across the users.
Thus, partners may be in various businesses and develop different consumer loyalty types that are not comparable. An airplane and a restaurant, for instance, may serve the same consumer yet provide different services and goods. Since they can put a financial value on the service they have received as loyalty rewards, consumers associate points and mileage with a monetary unit (De Jong et al., 2019). For instance, they can use the miles they have managed to earn to pay for flight tickets or restaurant bills. However, there is always the possibility that if a client pays cash, they will not take advantage of a deal. In such circumstances, loyalty miles emerge to be more price reduction than a form of currency.
The Influence of Emirates Loyalty Program on its Overall Performance
Successful firms demonstrate long-term payoffs from the basis of ethics and objectives in a variety of sectors. Conversely, economic benefits are gained through investing in actual people within organizations, as well as investments in infrastructure (Sadik, 2018). Investment in people may help a firm reduce its operating expenses by empowering its workers to outperform the rivalry in relations to productivity (De Jong et al., 2019). This is accomplished through an uncommon culture and continuous training and equipping of the personnel to make it remarkable. At the same time, it emerges from a company’s dream, which is effectively conveyed to all organization members.
Furthermore, senior executive teams and top managers at all levels of the company play an essential part in energizing persons in the quest for a vision. When likened to other rewards programs run by equivalent industries such as hotels, the passenger numbers wanting to join air miles is indeed significant (Sadik, 2018). As a result, basing a firm’s operations outlook purely on the number of individuals in a specific program can be deceptive (De Jong et al., 2019). Helpful insight into airline miles is that segment of the incentives includes discounted rates at hotels allied with a given passenger’s trip.
Following the acquisition of data insights, the research gathered more information regarding the program’s strategic purpose and how management at Emirates Airline is utilizing the program to improve customer numbers. Other anticipated findings from the investigation include the types of regular visitors served by the program and its upgrades. This method gives several points as well as data for analysis (De Jong et al., 2019). Firstly, there is the firm’s anticipation against the actuality of market performance in Skyward Program usage. Secondly, there is the formulation of approaches resulting from managerial assessments on the program’s outcomes and demands for improvements, which provides this research with information on the carrier’s responsiveness and tactical stance toward its market expansion ambitions.
The following are the results of surveys with five Emirates Airline management staff members about the Skyward Program. The company made wise market decisions, and as a result, it has grown to become a world power in the aviation business. On the other hand, regional passengers have the level of expectation, followed by those in areas where its flights are most regular. Passengers want the Airline to provide great elegance and service in all classes, without exception. Being free of any worldwide alliance obligation has been a source of strength for the company, enabling it to partner primarily with large corporations that share its ideals (De Jong et al., 2019). The Airline gives its benefits in miles, which are often regarded as the most significant value for frequent flier initiatives. Despite the lack of affiliation, Emirates collaborates with different carriers for mile transfers and route connections, including Alaska Airlines, JetBlue, Thai, Philippines Airlines, and Virgin America. The Airline works with two program transfer partners: American Express membership benefits and Starwood Preferred Guest.
Presently, the granting of miles is not made public. Customers must verify the legitimacy and comparability of their mileage for specific journeys. The company’s website and smartphone apps include a mileage calculator. The value of miles changes depending on where one lives. Customers can choose between the saving and flex choices when redeeming miles. The first includes fewer premium choices than the second, and consumers may pick which miles they wish to accrue when purchasing tickets. For its plan, the corporation encourages stopovers as well as variable prizes.
Clients of the corporation’s saver miles are restricted; they garner only half the distance traveled and are not eligible for one-way grants. Emirates Airlines enforces an $80 cancellation fee for saver awards as well as a $55 cancellation fee for flex awards (De Jong et al., 2019). The mileage is subject to significant rising fuel, and accruing them is predicated on fare classification and regions traversed. A first-class journey award enables customers to utilize the best of the new Airbus A380 planes, which includes shower cubicles, air lounges, and access to a bar manager (De Jong et al., 2019). For instance, the air carrier permits upgrades towards the next class, from economy to business and then to first class. Travelers who advance to the elite level receive extra benefits in addition to the advantages given at the preceding stage.
Since its inception, the Skyward program has been quite popular, and it has assured that many travelers upgrade to flex rewards for the most miles. This implies that they are flying in business or first class. Apart from miles, customers may stay at hotels such as Starwood, Shagri-La, Marriott, as well as InterContinental, in which they will spend around 550 miles every night. Many suppliers offer car rental services, such as Budget, and range in price from 500 to 2100 miles (De Jong et al., 2019). Expenditure at partner stores and services, such as Danat Dubai Cruises or Arabian Excursions adventures, earns tourists one credit for each and every two dollars spent. These channels reward clients with miles and encourage them to utilize those miles by traveling with Emirates. The company has currently expanded its codesharing business to fourteen carriers.
This enabled Emirates to benefit from hub benefits at a number of airports in adding to its Dubai base. The group of affiliates has grown to include twelve airlines, one financial institution, six car rental firms, twenty-three hotels, as well as twelve retail and leisure organizations. The number of customers grew from 29 million in 2012 to 52.3 million in 2017 (Sadik, 2018). Furthermore, passenger numbers increased by an average of 6 million between the fiscal years 2014/15. Correspondingly, this amounts to 13 percent and 12 percent (De Jong et al., 2019). Emirates Airlines has been eager to provide service assistance to its customers by communicating with them on a monthly basis via newsletters and its website. Members may check their offers for points and miles online. According to member comments, one disadvantage of the program is that users cannot exchange miles earned on partner companies to the Skyward Program. Furthermore, a one-way reward charges more in miles than round-trip airfare.
The software is not perfect, and there is growth potential, but after evaluating the advantages and negatives, it is one of the most popular. Although customers may collect points when flying with partner airlines that specifically relate to Emirates destinations, they can only do so at a partnering rate when such carriers do not utilize Emirates flight information (Sadik, 2018). Another hurdle for members, and a good thing for the corporation, is that it limits mile earning. Most acquired miles are useless without tier qualifying due to their tiny size. A significant issue is that transferring alternatives for the partnership program are not available across the world, and members have few alternatives for converting their mileage to other reward points.
Moreover, the Skyward program received an online improvement known as Just-A-Click-Away, allowing users to easily switch their accumulated miles to qualified air fares. The Emirates.com option allowed users to adjust their luggage limit, lounge access, and chauffeured drive within 48 hours. There are no service costs. Thus, from 5000 kilometers and higher, advancement is available (De Jong et al., 2019). American Express members may move as few as 60,000 participants’ miles to buy a round-trip economy ticket (Sadik, 2018). They have accessibility to Dubai or any of the more than 150 destinations covered by Emirates Airlines. Eligible cardholders in the United States, the United Kingdom, and France can earn a 30 percent bonus when converting points to miles for a specific timeframe.
In contrast, the Airline has been expanding the number of hotels where customers may collect points as guests. Another was Taj Resorts, which now provides Skyward Program members with 500 miles for vacationing at their facilities (Sadik, 2018). With the platinum level, Emirates can interact with air carriers such as Quantas to accept earnings as well as reward possibilities for any airline without requiring users to devalue their acquired miles (De Jong et al., 2019). (Sadik, 2018). More than 2.5 million passengers have utilized each firm’s codeshare network. Emirates introduced 26 new codeshare flights in the Pacific Region in 2015.
In 2012, there were 5.75 million Skyward subscribers. Regardless of the fact that the airline sector had just announced a $9.4 billion loss in 2011, Emirates claimed a profit of $965 million in 2012, and passenger traffic increased by 4.8 million to 28.6 million (Sadik, 2018). Other code sharing initiatives in Africa include a ten-year administrative concession arrangement with the state of Angola that involves code sharing with the nation’s Airline. Emirates has increased code cooperation with other current companies as well as with SNCF to guarantee that travelers utilizing rail in France’s 20 regions gain miles as well. In addition to codesharing, Emirates. The Airline is researching tactics to have its operations co-located in an airport’s primary hub user to provide a seamless connection to its passengers.
Emirates Advancement Prospects
The first prospect is that Emirates Airlines concentrate on improving its Skyward scheme through code sharing. Under the Skyward initiative, code sharing is the most important source of new consumers. Secondly, is to increase targeted marketing activities and Skyward Plan enrollment. These clients are easy to convert and turn into brand champions. Consumers form a buried cost connection as a result of their frequent travel, making it harder for them to transfer to rival plans (De Jong et al., 2019). The benefits of earning more miles by traveling with Emirates Airlines are factors that the carrier may use to modify its prices gradually.
Thirdly, the company aims to increase the number of Skyward destinations that it now administers, both for codesharing customers and those who exchange points from American Express and other choices. One crucial factor is that business travelers have more reasons to fly with a specific airline to multiple locations (De Jong et al., 2019). They are in a more excellent position to take advantage of the firm’s plan than other economy or premium passengers.
A fourth vision is to investigate the transferability of its rewards among carriers. It keeps losing clients who are flying on major alliance airlines and want to convert their acquired miles but are unable to do so. Joining such alliances may not be in accordance with the carrier’s overarching strategy (De Jong et al., 2019). However, creating a means to include mile transfers, even if at a more significant cost to the member, will be an intelligent effort to increase the number of people who join using its membership incentive programs.
Fifthly, the company aims to limit chances for accumulating miles in order to minimize service abuse. Some astute members may not travel regularly and instead spend money on related items and services to gain miles or transfer points from credit cards to miles. This approach is common with would-be travelers looking for a good deal, but it does not benefit airlines. Limiting the choices for changing miles gained from non-travel expenses is an excellent tactic that Emirates employs with its Skyward reward program; thus, it should keep doing so (De Jong et al., 2019). The goal is to construct the program so that most users are forced to travel to obtain miles or to maximize the usage of acquired mileage. The Airline may then focus on advancing these customers to higher standing levels
Conclusion
Emirates Airline is in a solid position to maintain client numbers with its reward initiative. It has already improved its operations in the aviation business. Nonetheless, it confronts hurdles in up-selling its packages to clients to allow them spend more in travelling. Thus, additional marketing of its services amongst Skyward Program participants is required. Furthermore, the study discovers that in conformity with the results of a literature review on the comparative edge of frequent flier initiatives, the optimal strategy for Emirates is to leverage into the interchangeability of miles from other carriers, increase program subscription, and toughen user experience features so that miles are mostly received and spent through flying. The study’s dependence on self-reporting by management, which might overstate some facts, is one of its limitations.
References
De Jong, G., Behrens, C., & van Ommeren, J. (2019). Airline loyalty (programs) across borders: A geographic discontinuity approach. International Journal of Industrial Organization, 62, 251-272. Web.
Sadik, R. (2018). Implementation of total quality management in Airline (Case study Emirates Airline). International Journal of Advances in Computer Science and Technology, 7(5), 22-25. Web.