A new era in travel: Millennials’ influence on loyalty programs


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Millennials. Many may see this generation as being raised on individualism, independence and Instagram, but one thing for certain is that this population is regarded for their knowledge of the latest technology trends. Being born at the height of the dot-com era, it is no wonder that this generation seems at ease when introduced to the latest technology product to grace the marketplace. Growing up with technology so readily available at their fingertips, millennials desire to see the technology products they use on a daily basis being implemented into the industries they touch – including travel. It is because of their influence that travel organizations – airlines, hotels, tour operators – and their loyalty programs are actively embracing the latest technology trends to try to keep up.

Due to their population size and influence on today’s biggest brands, millennials are one of the most important subgroups within not only travel, but society. In fact, one-in-three American labor force participants (35 percent) are millennials, making them the largest generation in the U.S. labor force. Beyond just their presence, millennials also have more spending power than any other generation. From their mobile-first behavior to their strong preference for experience-based vacations, millennials are singlehandedly reshaping the travel industry with the use of technology.

Embracing technology within travel

Millennials are not just technologically savvy; they’re technologically dependent. They are transforming the travel industry due to how they interact, transact and gather information while on-the-go. Due to millennials’ desire for real-time information, travel organizations must turn to the latest technology solutions in order to promote constant communication between their brands and individuals.

At the leading edge of this consistent two-way dialogue is through the use of chatbots. Today’s chatbots allow airlines, hotels and other travel operators to engage with customers in a more automated and frictionless way. Additionally, with the emergence of AI and Natural Language Processing (NLP), chatbots have the power to personalize experiences, giving millennial customers exactly what they want, when they want. The travel industry has also seen technology like voice assistants (Siri, Amazon Echo, Google Home, etc.) and message-based interfaces (SMS, Facebook Messenger, WhatsApp etc.), shape how companies communicate with consumers. These technological advancements have not only enabled travel organizations to create their own voice, but have also enhanced their loyalty offering by providing customers direct access to real-time responses.

The travel industry has also witnessed the emergence of augmented reality (AR) and virtual reality (VR) as viable technologies that allow travelers to consider new destinations that otherwise might have gone undiscovered. Using a “try-before-you-go approach,” virtual tours make destinations seem more approachable, even those that may have once been intimidating. VR and AR can also enhance traveler’s overall experience in a new region through wayfinding in a busy airport, supplementing a city walk with information from local experts, or by enhancing a museum experience. Millennials rely heavily on technology to research, share and experience travel, but they still have new and growing expectations for the travel experience itself. To connect with millennials, it is vital for travel organizations to tap into this generations’ needs, using technology as a bridge to always be connected and part of their conversations.

The next five years: how travel organizations can stay relevant

While technology can serve as a direct line to millennials needs and desires, it is only half of the answer to engaging with this generation on a personal level. Millennials have growing expectations for the travel experience itself – many of which will be seen over the next five years.

Millennials’ appetite for global enlightenment and wanderlust rivals the 60 percent of seniors who set their sights on travel following retirement. Travel is no longer just a special treat or a once-a-year vacation; it is a lifestyle priority. In fact, Boston Consulting Group found that millennials are 23 percent more interested in exploring the world than older generations and make up to 20 percent of all international tourists. To capture this generation’s trust, travel organizations must transform themselves into lifestyle brands, using content that incites the desire for adventure and exploration.

For older generations, like baby boomers, luxury travel used to be about sipping cocktails by the pool, but this image doesn’t resonate with younger generations. Instead, millennials seek authenticity and shareability in their travel. They desire to experience the history and traditions of the country they visit – find where the hidden gems are and connect with the local culture and people. Environmental sustainability and social responsibility also play an important role in providing a sentiment of authenticity. Millennials are choosing travel organizations – airlines, hotels and tour operators – that have a clear sense of brand purpose and social responsibility. Therefore, it is up to travel organizations and their loyalty programs to capitalize on their purpose to secure long-term loyalty from this generation.

Technology leads to continuous communication

Millennials are turning to technology that better optimizes their time traveling to and from their destination, as well as providing options for experiences and local authenticity at their destination. In order to meet these needs, travel organizations and their loyalty programs must first be able to communicate with millennials through technology, which is a medium that resonates most with them. By connecting with Millennials through technology, travel brands will be able to form more authentic relationships and adapt to the needs that matter most to this generation.

Phil Seward
Phil Seward is the senior vice president of loyalty strategy for the Americas at Collinson, a global loyalty and benefits company. With 20 years of agency and client-side experience developing innovative customer loyalty strategies, Phil is responsible for driving devoted customer relationships for Collinson’s clients across the U.S. and Latin America.


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