Loyalty - Back to the Roots | Phocuswright Research with Madeline List

Madeline List, Manager of Research and Special Projects at Phocuswright, presents original research on travel loyalty with the argument that industry discourse has lost sight of what loyalty actually means. Drawing on a study of US-based leisure travelers, she contends that loyalty—defined as repeat brand patronage rooted in a strong feeling of support or allegiance—has been overshadowed by an obsession with points, miles, and program mechanics that are merely vehicles toward that goal, not the goal itself.

The research begins by establishing a baseline: most travelers either rotate across multiple brands or travel infrequently enough that they have not formed a single favorite. Among those who do have preferred brands, the criteria for selection are strikingly fundamental. For airlines, top selection factors are value for money, competitive pricing, on-time performance, and convenient routes and departure times. For hotels, value and price again dominate, followed by cleanliness and amenities, with loyalty programs entering the top five. OTA users with a favorite platform are the most price-driven of all segments, though they also cite convenient booking experience and customer service—with loyalty programs ranking fifth.

List argues clearly that product quality and pricing strategy are non-negotiable prerequisites. Without those in place, she sees no basis for expecting a loyalty program to shift traveler behavior. For brands that have achieved a high-caliber product, however, program relevance becomes meaningful. The data supports heavy engagement: 52% of US leisure travelers redeemed points for at least one component of their most recent trip. Redemption patterns skew by generation—two in three millennials who redeemed did so using credit card points, OTA programs are disproportionately popular with younger travelers, and provider miles dominate among Boomers and the Silent Generation.

The financial motivation behind redemption is explicit: travelers cite reducing out-of-pocket trip costs, making expensive destinations accessible, and directing saved money toward experiences they care most about. Beyond redemption, 84% of leisure travelers reported engaging in at least one "gaming" behavior in the prior year—including buying gift cards solely to earn points, opening credit cards to capture sign-up bonuses before canceling, flying to destinations they would not otherwise visit to maintain status, or making purchases on behalf of others to accumulate points.

Despite this program engagement, List cautions against conflating program participation with actual loyalty. She presents data showing that most travelers with a declared favorite brand still used a competitor in the past year, particularly in the OTA category. The primary reasons travelers "cheat" on their preferred brand are: better pricing or value, better product fit for a specific trip, and—notably—novelty. The desire to simply try something new appears as a top driver across airlines, hotels, and OTAs, making it what List calls "the most insidious" threat to loyalty because it reflects not dissatisfaction but restlessness.

List closes with a prediction: the winners in the loyalty space will be brands that simultaneously maintain strong product quality and pricing, offer a sense of novelty, and deliver genuine value through their loyalty programs. She frames loyalty not as a product of any single program interaction, but as the cumulative result of all brand touchpoints across the customer lifetime—a challenge complicated further by labor shortages, the uneven integration of AI customer service, and an ever-expanding number of physical and digital touchpoints.