Business Boost: United has been able to convert 4 percent of its non-members to the MileagePlus program, resulting in tens of millions of dollars in additional revenue.
The 2010 merger between United Airlines and Continental Airlines created not only one of the world's largest airlines, but also one of the world's biggest loyalty programs. As the two airlines went about merging their respective customer databases, executives at United saw an opportunity to explore new and creative ways to use customer data from both MileagePlus and non-members that could help it to build richer profiles of its customers that could enable the airline to deliver more personalized and relevant communications, critical day-of-travel updates, and to ultimately deliver better customer experiences.
United also sought to break new ground. The only customer database that United previously maintained was for its MileagePlus members. United decided to expand the database in order to provide more relevant and personalized communications with the millions of customers who aren't MileagePlus members and to serve their needs better.
United partnered with Acxiom Corp. to help it build richer profiles of its MileagePlus members and also non-members. In addition to identifying duplicate records to help United work with the cleanest and most accurate member information possible, Acxiom also overlays demographic and lifestyle data on top of customer records and groups them into customer types. For instance, while United tries to include basic demographic information in each member profile such as age, household income, and net worth, in some cases it relies on Acxiom to either fill in missing pieces of information or to add interest-specific elements, such as members who enjoy playing golf, says Mark Krolick, managing director of marketing and product development at United.
United has also been able to make more effective use of its member data and interact with customers in ways it wasn't able to before. Each day, United analyzes its MileagePlus database to identify customers who are about to reach a certain milestone, such as specific mileage levels, program anniversaries, or birthdays. The general manager or another designee at one of the 72 domestic airports that the program has been extended to then fills out a hand-written thank-you card and passes it along to an agent to hand out to these customers as they scan their boarding passes when they're about to board their flights.
"The customer feedback has been a nice validation and we're seeing value from the program," says Michelle Brown, director of the MileagePlus program at United.
Having richer customer information has enabled United to segment its customers more accurately and effectively. For instance, United can group customers by similar past behaviors, such as customers who have been price sensitive. United can then use these insights to create more relevant offers for customers, such as sending frequent business travelers an offer to purchase an airport day lounge pass, says Krolick.
United's ability to develop richer information about all of its customers - loyalty members and non-members alike -- has enabled the airline to send more personalized offers to its non-members, improve the customer experience for all of its passengers, and drive greater revenue. Since the initiative was launched, United has been able to convert 4 percent of its non-members to the MileagePlus program, resulting in tens of millions of dollars in additional revenue.
"We have put together a solid operation," says Krolick. "We're investing in customer service and the right marketing technologies and at a macro level the pieces are all falling into place for us to become the world's leading airline."
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