What have you done for me lately?
On May 1, 1981, American Airlines invited a select group of frequent flyers to join a new program called AAdvantage with a simple promise. Keep choosing American and we’ll reward your loyalty with benefits including free flights and upgrades. Nobody launching that program could have imagined that four decades later airlines would borrow billions of dollars against those same loyalty programs or that banks would pay billions every year to buy the currency they created.
The idea that worked for everyone
The original idea was remarkably successful because everyone benefited. Airlines and hotels encouraged customers to return, while travelers received something tangible in exchange for their loyalty. Every flight and every hotel stay also gave suppliers a better understanding of who their customers were, how often they traveled and what influenced their buying decisions. Loyalty became one of the first commercial tools that allowed travel companies to build lasting relationships with individual customers instead of simply filling seats and rooms.
The next stage arrived as airlines formed global alliances and hotel companies expanded across multiple brands. Travelers could remain loyal to one program while flying different airlines or staying in different hotels. The relationship became more valuable because customers could earn and redeem rewards across a much broader network, giving suppliers another reason to invest in loyalty and another reason to encourage customers to keep everything in one place.
Status accelerated that investment. Gold, Platinum, Diamond, and Titanium became goals that many travelers wanted to achieve and even fewer wanted to lose. Travelers booked additional trips, selected higher fares, and concentrated more of their spending with a single supplier because the benefits attached to the next tier felt worth pursuing. Over time, the rules also changed.
Airlines increasingly rewarded revenue rather than distance flown, while hotel groups raised the number of nights needed to earn and retain elite status. The message was basically: spend more, stay more, and concentrate more of your travel with us. It meant loyalty was now a fixed part of the purchasing decision.
When miles became currency
Banks started to catch on. Airline miles and hotel points had become their own currencies, something customers genuinely valued, creating an opportunity to connect everyday spending with future travel. Co-brand credit cards transformed loyalty again because airlines could sell miles before passengers boarded an aircraft and hotels could generate revenue before guests even checked into a room. Every purchase became another opportunity to earn rewards, whether the customer was traveling or buying groceries.
That currency could now be earned and redeemed in countless ways. Flights and hotel stays were only the beginning. Travelers could accumulate points through everyday spending, online shopping, dining, car rental, financial products, and a growing network of commercial partners. Loyalty to a travel provider became just one part of a bigger commercial ecosystem.
The relationship is worth more than the booking
And so, the commercial opportunity continued to grow. During the pandemic, airlines secured almost $20 billion in financing against their loyalty programs because those programs continued producing reliable revenue while aircraft remained on the ground. Delta’s partnership with American Express now generates billions of dollars every year. Marriott has invested so heavily in Bonvoy that many travelers recognize the loyalty brand as readily as the hotel company itself.
The travel booking has value, but the loyalty relationship with the traveler has considerably more. That is what suppliers, banks, and payment companies have been investing in for years. Marriott Business Access now combines negotiated hotel rates, booking, expense, and loyalty in a single proposition. American Express continues bringing together travel, payments, expense, and rewards, while Chase expanded into travel through cxLoyalty and Frosch. See the first post in this series, Banking on Travel.
The bottom line is that everyone is now competing for both the booking and the relationship with the traveler.
Where loyalty and managed travel pull in different directions
But somewhere along the way, loyalty stopped rewarding behavior and started influencing it. Every managed travel program depends on influencing traveler behavior. Organizations negotiate supplier agreements, establish travel policies, and invest in technology because they want travelers making choices that support the objectives of the business. After all, it’s corporate money that pays for the business trip and those bookings should be made in support of the travel program guidelines. Loyalty influences many of those same decisions, although it does so for different commercial reasons.
A traveler approaching the next elite tier may decide another airline is worth the extra connection. Someone chasing lifetime hotel status may choose a different property from the negotiated program. A richer rewards proposition on a payment card may influence where travel is booked or where company spending is directed. Of even greater concern for managed travel is that suppliers have also increased the incentives for booking direct by offering additional points, exclusive rates, and enhanced benefits that are often unavailable through other channels. It is another example of loyalty influencing traveler behavior. Those decisions are entirely predictable because loyalty programs were designed to encourage exactly that behavior.
The question for buyers is whether those incentives continue to support the goals of the travel program. Supplier agreements, traveler satisfaction, servicing, visibility, and policy compliance all depend on travelers making informed choices. Every new loyalty proposition deserves to be viewed through that lens because every company introducing those products has its own commercial objectives.
Why does everyone want a piece of travel?
The evolution of loyalty also explains why so many organizations are moving into travel. Loyal customers spend more, travel more often, and generate value long after the original booking has been made. That relationship creates spending, data, and engagement that extend far beyond a single trip. It is one of the reasons banks, payment companies, technology providers, and suppliers continue investing so aggressively across the travel industry.
The original promise of loyalty
The original promise behind loyalty was simple: thank customers for coming back and reward them for choosing your brand again. Forty-five years later, loyalty asks much more of the traveler. ”Fly a little more, stay a little longer, or spend a little extra. Carry the right payment card. But don’t forget to protect your status.” Why? Because next year everything starts again. History and long-term loyalty have been replaced by “what have you done for me lately?”
That is an extraordinary journey for an idea that began with a free flight and a thank you.
