A Loyalty Program Is A Two-Way Street

It’s funny how things work out sometimes.  Our family flew to Orlando last week in the midst of Hurricane Matthew for a few days of fun at Legoland and Disney World.  One of the things I really look forward to when I travel is reading a newspaper.  I don’t often find the time when I’m at home or in my destination city for work.  But, getting on an airplane affords me a small window to cruise through the newspaper, assuming e-mail isn’t overwhelming my iPhone.

The Wall Street Journal is my preferred paper, and Scott McCartney’s “The Middle Seat” column is one of my favorite reads on a weekly basis.  I really like Scott, even if he did make a bit of fun at my expense over the hair-dryer pact I have with my wife.  He and I share a love of good Texas BBQ and Duke basketball, which more than makes up for it.

I knew as soon as I read Scott’s column this past week that I’d disagree with the assertion.  After all, what red-blooded travel junkie wouldn’t have an issue with the heading, “Wyndham scores an upset while Starwood and Marriott retool following their merger; a better value than airline miles”?

I resolved to bang out a quick blog post about what was so wrong in assuming Wyndham was a better value because of their program structure and how much they rebate to their loyalty members.  Then, we landed in Orlando, hopped in a car, drove west, rode out a hurricane, spent a few days at Disney World and returned home, exhausted but happy.  The Personal Journal section of the WSJ with that article is still in my backpack, a blog post that just never found the time of day.

And then, Wyndham soiled their diaper yesterday when they yanked a promotion before it even started, with catastrophic results for those customers that acted in good faith leading up to the start of the promotion.  My language might seem harsh and crude, but this was an immature response to a known problem.

Fraud happens everywhere, not just in airline loyalty programs.  There’s no doubt in my mind that people would try to defraud a promotion like this.  But, there are plenty of ways to protect the company.  JetBlue ran a similar promo earlier this year and limited the amount of points you could earn.  Large companies have legions of lawyers that can write terms & conditions that give them the ability to decline a transaction when they detect fraud.

Instead, Wyndham chose to throw their hands up in the air and claim they were done in unknowingly by fraud.  “Much to their dismay….” the release said.  One online definition of dismay reads, “consternation and distress, typically that caused by something unexpected”

The possibility of fraud should have been expected, a plan developed for how to handle it.  Now, Wyndham wants to say it’s not their fault if a SPG member, in good faith, donated their point balance and wants Wyndham to make good on it.

Put another way, saying that Wyndham doesn’t have to honor a promotion because they detected fraud is akin to saying Visa and MasterCard have no obligation to pay you loyalty points on legitimate transactions when there is fraud committed on someone else’s credit card account.

Trust Is Key

View From the Wing spoke further with Wyndham yesterday and they noted they’ll work with folks who already donated their SPG balance.  Those who already donated their SPG points don’t really have another choice at this point, but I wouldn’t be placing any bets on Wyndham here.

Some people think loyalty programs are a one-way street.  Heck, even some loyalty programs (Delta, looking at you) think that.  A customer patronizes a hotel, the hotel recognizes them with some elite benefits and the hotel program awards them some points.  Transaction completed, right?

There’s much more than that.  The customer needs to know that those points they earned will have some reasonable value for a reasonable period of time.  They need to know the loyalty currency is good.  Put another way, would you purchase a warranty on a really expensive car from a company going out of business?  How could they honor the warranty?

Travel loyalty programs earn trust over a period of time.  The bond of loyalty should help customers when they need to pay a little more, fly a little further or are inconvenienced when a plane runs late.  When a loyal guest shows up at a hotel and gets a bad room, all the positive experiences in the past should outweigh that one bad experience, assuming the hotel fixes it.

Value Remains Subjective

The IdeaWorks survey touts Wyndham as the winner because they give you back more of your money for each stay.  But, they’re not giving you back cash.  They’re giving you back “Wyndham Bucks”, and you have to rely on their program to hold the value of those points so you can get your rebate.

This isn’t the first time Wyndham has gone back on their word.  I might not love the SPG merger, and I’m sure not as happy with the SPG program overall.  But, they’ve never botched something this bad.  It’s not all sunshine and daisies, but there’s a general level of trust I have with their program.

And, that’s what this survey fails to measure.

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