Carlson Marketing recently published a white paper titled “Low Cost Carriers & Loyalty: The FFP as the Ultimate Ancillary Revenue” and outlined some of the ways that low cost carriers differ from legacy carriers and how they benefit from having a loyalty program. Because low cost carriers typically target budget-minded flyers who are only looking for the lowest price, these travelers tend to be less influenced by loyalty programs. Plus, low cost carriers don’t participate in the large worldwide airline alliances and for the most part can only offer flight awards to domestic destinations, “The lack of high-profile, aspirational rewards such as business and first class tickets and upgrades, and an international partner network covering ‘dream’ destinations will reduce the appeal.”

However, FFPs can provide revenue to the airline through the sale of miles and the data that can be gathered from members can help the airline understand and predict customer behavior. Low-cost carriers also have some advantages in that their FFPs tend to be less complex than legacy carriers, making them easier for customers to understand and utilize. To read the entire report, visit http://insideflyerus.wpengine.com/link/?2509