Low-cost airline, AirAsia launched its new Freedom Flyer Programme last week at RedQ in Kuala Lumpur, a first step in group CEO Tony Fernandes’ dream of “removing cash from the plane”.
At the launch, he said, “we never really knew loyalty very well… having said that, we have 13 million card members. My expectation is that it’ll contribute to our top line… Underlying all of this is my dream of making ASEAN smaller. With a points programme, we can enable people to fly more.”
The new loyalty scheme is one step towards AirAsia’s much grander ambitions of expanding beyond aviation and evolving into a more integrated digital brand.
“I’m a big believer in data, data is the new oil. Once we have the co-brand card as well, we will know what you spend on and where you spend. Combining that with flight data makes it very rich. The more we know about you, the better we can tailor our offers towards you. Loyalty is a very strong source of data,” said Fernandes.
“If we can get to 30 million members in the next 2-3 years, that’d be a good start.”
Thus, creating an entirely digital, mobile-optimised loyalty scheme – without a physical loyalty card – is a symbolic first step away from more traditional types of brand membership.
“In our innovation room, we’re working on an electronic pre-paid card, so my dream is that very soon you’d be able to use points to buy food, or with a cashless card, we will remove cash from the plane.”
With this revamped version of BIG Points, AirAsia wants to differentiate its loyalty programme from other air carriers by offering points and rewards based on the frequency of flights taken, over cost of airfare. The membership is free and points awarded only expire after 36 months of inactivity.
AirAsia’s Freedom Flyer Programme introduces four tiers – Red, Gold, Platinum, and Black – where equal amounts of spend accrue a different number of points, depending on your status, or what they call an ‘accelerated earn structure’.
To incentivise consumers to also sign up for AirAsia’s co-brand credit cards, the new scheme also promises an immediate promotion for new card members to Platinum status for the first year.
AirAsia also intends to introduce membership status discounts and differentiated airline privileges across the brand, in the coming months. Points can also redeemed through AirAsia’s travel and lifestyle partners worldwide.
Beyond the airline, “I believe BIG points can be a currency in ASEAN going forward, in terms of being able to buy things [across cities],” said Fernandes. He envisions shoppers throughout the region being able to make purchases in various retailers, internationally.
Essentially, AirAsia has laid out the early stages of a larger blueprint designed to help it develop an e-commerce environment or ecosystem. By first cultivating loyalty through flight bookings and encouraging further spend through its tiered scheme, AirAsia will be able to collect and collate a robust body of data that can inform its future strategies as it expands its relationship with the customer beyond flights.
Yet, Fernandes suggested that this data could also help the airline innovate in other parts of the travel experience like the check-in process, which he describes to be “the worst experience” when flying.
“We know a lot of about you. We should be able to check you in much quicker, you should be able to board [or pay] with your fingerprint or your face etc.”
Overall, it seems AirAsia has laid bare aspects of its strategy to cultivate and generate tangible value out of big data provided by its customers, through the framework of a loyalty scheme. Coupled with its intentions to move beyond flights and into online payments, AirAsia will not only be able to adapt to consumer trends quickly through their own data, but inch closer to become a full-fledged digital brand.