Loyalty by the Billions
IdeaWorks analyzes how frequent flier programs pour cash into airline coffers.
Thirty years ago the chairman of a leading European-based airline declared his disgust for frequent flier programs. He called them an “American disease” that would hold no allure for the more sophisticated Europe-based traveler. History has proven the folly of this belief. Europe now boasts more frequent flier programs than the number offered by USbased airlines, and the FFP phenomenon has spread worldwide. Beliefs are sometimes hard to dispel, and too many airline executives still think frequent flier programs are ruinous for
the bottom line. It’s impossible for critics to ignore the $7 billion accrued in 2010 by the programs associated with five global airlines. IdeaWorks offers this report as a rebuttal to anyone who says, “Frequent flier programs cost too much money.”
American Airlines is credited with introducing the first frequent flier program in 1981.1 This invited an almost immediate response by United Airlines and Delta Air Lines, both of which quickly introduced competing programs. The rest of the world took a bit longer. For example, KLM’s program began in 19912 and programs for Lufthansa3 and Japan Airlines4 followed later in 1993. Today, airlines all over the world ...
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