Randy Petersen's Opening Remarks – January, 24 2012

Randy Petersen's Opening Remarks – January, 24 2012

Stuck in 2011

Here it is, 2012, and while I should be thinking about the new year, I’m still stuck in 2011. My thoughts are not lost, but still trapped on a particular bonus offer that exhibited once again the unique behavior and challenges that persist in the loyalty world.

The bonus offer that I just can’t seem to shake from my mind is the famous, or infamous if you will, Radisson Big Night Giveaway which ran between Nov. 10 and Dec. 30. The premise of the offer was to celebrate the debut of the Radisson Blu brand in North America with the opening of the Radisson Blu Aqua Hotel in Chicago and 50,000 members could get 50,000 points just for one Radisson hotel stay.

For those readers without their cell phone calculator handy, that’s a 2.5B bonanza of points. Yes, 2.5 BILLION points. Let’s hope that the Blu brand works in North America, and from early trip reports I’ve read, the brand is worthy. But my sticking point for this bonus before I can move on to 2012 is … I’m trying to determine if the bonus bonanza was worth it.

Sure, it generated some buzz. Actually, if I simply look at the social media coverage it received just among the bloggers on BoardingArea, the bonus promotion was among the leading stories of the year, generating interest, buzz and of course, room night revenue. Along with that interest was a huge, and I mean HUGE take-up among opportunists. I saw some of my own employees get caught up in the idea of how to leverage a single stay against a bonus payout later on. I also had many offers of surrogate check-ins at hotels where the rate was extremely reasonable relative to the bonus offer, such as $59 for a single night–and the buying power of the award is maybe up to $300-400 if you can swing it.

Through my own personal observation and research, I can easily guess that there were nearly 2,000 opportunists for this single bonus bonanza. But that’s likely a drop in the bucket for the overall number.

But now I’m thinking, and “listening” to those who received the bonus into their account. What now are their plans to leverage the points? Fact is, many of these opportunists will now likely use the points for a purpose far more pedestrian than the seven Radisson Blu hotels that are located in and around Paris.

So, it leaves me thinking, did Radisson simply “out Groupon” Groupon by coming up with a bonus that caused many travelers to “pre-buy” an advance purchase at a Carlson Hotel? Stays that increasingly, I observe, would not have been purchased if not for the Big Night Giveaway? And regardless of the rationale and redemption rates, does this promotion create a demand for the Radisson brand in the near future? I’m sure the analysis that can help shape the answer are many months from being proven, but in the meantime, Radisson did provide an exercise that likely reinforces the Pavlovian idea of a stimulus and a response to buy. When I think of 2.5 billion points, that is a lot of stimulus.

My 50,000 points posted–now I can move on.

Last month, in one of our WiseFlyer answers to readers’ questions, we used several frequent flyer acronyms and received several complaints from readers who did not know their meanings. We apologize for the oversight and are defining the terms here for your reference: 1P = Premier Executive; PNR = Passenger Name Record; SWU = Systemwide Upgrade; UDU = Unlimited Domestic Upgrade; CR-1 =

Confirmed Regional Upgrade; E+ = Economy Plus.

If you are ever faced with other travel abbreviations that you do not know, milepoint maintains an excellent glossary of these and other terms used by frequent flyers here: http://milepoint.com/forums/pages/glossary/

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