Latest / Leaders in Customer Loyalty, Powered by Loyalty360 / #529: Leaders in Customer Loyalty: Brand Stories | Inside WestJet’s Strategy to Keep Loyalty Simple in a Crowded Market

Transcript

#529: Leaders in Customer Loyalty: Brand Stories | Inside WestJet’s Strategy to Keep Loyalty Simple in a Crowded Market · Leaders in Customer Loyalty, Powered by Loyalty360

• 0:02
  SPEAKER_02: Hello, I want to welcome you back to the Leaders in Customer Loyalty Podcast.
• 0:07
  SPEAKER_02: This is the Brand Stories Edition.
• 0:08
  SPEAKER_02: It's a Thursday, and it's great having you with us every Thursday, so thank you.
• 0:12
  SPEAKER_02: Today's conversation is going to explore how customer loyalty in the airline industry continues to evolve as co-brand credit cards, travel rewards, and customer expectations become increasingly competitive.
• 0:25
  SPEAKER_02: Founded more than 30 years ago, WestJet has grown from a low-cost carrier into one of Canada's leading airlines.
• 0:32
  SPEAKER_02: Throughout that evolution, the brand has continued to differentiate itself through a strong culture and a commitment to strong frontline customer experience.
• 0:42
  SPEAKER_02: As the loyalty landscape becomes more crowded, particularly in the co-brand credit card space, WestJet has focused on balancing simplicity, value, and meaningful engagement for today's travelers.
• 0:56
  SPEAKER_02: Today we're going to hear from Byron Kelly about the evolution of the customer loyalty program, the growing importance of co-brand partnerships, and how WestJet continues to create experiences that strengthen customer loyalty.
• 1:16
  SPEAKER_00: Yeah, I'm great, Mark.
• 1:17
  SPEAKER_00: Thanks for having me.
• 1:18
  SPEAKER_02: Absolutely.
• 1:19
  SPEAKER_02: First off, for those who may not be familiar, can you give us a brief introduction to WestJet, what you guys do, how you do it, you know, how do you guys start?
• 1:27
  SPEAKER_00: For sure, yeah.
• 1:28
  SPEAKER_00: So we're Canada's second largest airline.
• 1:31
  SPEAKER_00: We fly about 25 million passengers annually.
• 1:35
  SPEAKER_00: We're Calgary-based, got about 200 aircraft.
• 1:40
  SPEAKER_00: We would most often be likened to say Alaska, uh, Alaska Airlines is a US equivalent, or a JetBlue or a Southwest.
• 1:47
  SPEAKER_00: That's probably the way to think of us.
• 1:49
  SPEAKER_00: Fly a lot domestically in Canada, US, some Caribbean destinations, and have a have a smaller footprint in Europe and Asia.
• 1:58
  SPEAKER_00: Um so we've been around for 30 years.
• 2:01
  SPEAKER_00: So we essentially WestJet came around when uh Canadian Airlines merged with Air Canada, and there was a bit of a void in the market.
• 2:07
  SPEAKER_00: And so WestJet sort of came in as a scrappier, lower cost type carrier, help bring prices down, make travel more affordable for Canadians.
• 2:15
  SPEAKER_00: Um that's kind of the history in a nutshell.
• 2:18
  SPEAKER_02: Excellent.
• 2:19
  SPEAKER_02: So when you look at uh the the airline, you know, what's led to the success?
• 2:24
  SPEAKER_02: Uh is it kind of the ability to kind of plug in uh and be that that that you know second option, uh, offer more flexibility, more uh customer experiences.
• 2:34
  SPEAKER_02: You know, what's led to the great success?
• 2:36
  SPEAKER_00: Yeah, I think for sure for sure the the company, like it originally it would have described itself as a low-cost airline.
• 2:43
  SPEAKER_00: It wouldn't anymore.
• 2:44
  SPEAKER_00: We we'd describe ourselves as a leisure-focused airline today, but it it really did concentrate on uh on a super low-cost profile and maintaining that advantage so it could offer better pricing.
• 2:54
  SPEAKER_00: And so that helped it get a foothold in the market, um, and I think sort of just get people's attention.
• 3:00
  SPEAKER_00: And then what set it apart over time was uh as it as it so often does, was the uh the the frontline staff.
• 3:10
  SPEAKER_00: And I guess the the comparison point in Canada is Air Canada, obviously um uh you know, much more established, traditional, sort of legacy network carrier.
• 3:19
  SPEAKER_00: And WestJet filled the space as a sort of more, I'd say, fun, lighthearted, a more relaxed kind of airline.
• 3:26
  SPEAKER_00: And that's not a knock on air Canada, that's just uh WestJet carving out its own space.
• 3:30
  SPEAKER_00: And so people kind of grew to like the friendliness of Westjet.
• 3:34
  SPEAKER_00: It's the sort of place where the pre-flight, uh, the safety video would be done in a fun way instead of just uh taking care of business kind of way, if you like.
• 3:43
  SPEAKER_00: So it was it was that that that helped WestJet sort of grow beyond its initial roots, I'd say.
• 3:48
  SPEAKER_02: You know, when you look at the airline industry, it's definitely going through some transformation.
• 3:53
  SPEAKER_02: Uh, you know, all those low-cost carriers are kind of changing.
• 3:57
  SPEAKER_02: They're upstreaming right there.
• 4:00
  SPEAKER_02: You know, they're they're adding first class, they're adding uh more seat room, they're adding, you know, uh redoing their credit card program to have more benefit.
• 4:08
  SPEAKER_02: I mean, aside from maybe Ryanair in in Europe, I mean, most everyone who was that low-cost, you, Southwest, Spirit, you know, they're gone now.
• 4:16
  SPEAKER_02: They've they've all kind of upticked and moved upstream.
• 4:19
  SPEAKER_02: What's driving that upstream push?
• 4:22
  SPEAKER_00: Yeah, it it's the I think at some point you need to do more than just compete on price.
• 4:30
  SPEAKER_00: Um, and to compete on price, you need that cost base to be able to offer the best price.
• 4:35
  SPEAKER_00: But then when you need to compete on more than that, and particularly an airline will see better yields, higher revenue from the non-low-cost carrier or the non-ultra-basic kind of fare purchase, so that you you almost can't help but push into that space a bit as well and say, how can I find a way, a way to play there?
• 4:56
  SPEAKER_00: Now, I'd say in the case of WestJet, it's been it's been 10 or 15 years that we've been not a low-cost carrier and lower leisure focused carrier.
• 5:04
  SPEAKER_00: Uh, we've had business class cabins for for a decade now and been traveling internationally uh for a decade now.
• 5:11
  SPEAKER_00: But yeah, you're right.
• 5:12
  SPEAKER_00: And it's one that we only see even more and more coming out of COVID, the the call it the premiumization of travel.
• 5:17
  SPEAKER_00: You see some of the US airlines like Delta Um and I think United American is sort of following suit.
• 5:23
  SPEAKER_00: They're all chasing the premium traveler because that's where you're making your money these days.
• 5:29
  SPEAKER_00: It uh up here in Canada, Lynx was uh was an ultra-low-cost carrier which which exited the market a couple of years ago.
• 5:36
  SPEAKER_00: Flair was the other ultra-low-cost carrier which sort of put its hand up six months ago and said, We're not a low-cost carrier anymore.
• 5:44
  SPEAKER_00: We're gonna become a normal carrier, if I can say that sort of to your point of it, it's a hard place to compete and and and airlines moving away from that.
• 5:53
  SPEAKER_02: Okay.
• 5:54
  SPEAKER_02: When you look at your role, can you tell us a little about uh your role, what you do uh at WestJet from a day-to-day basis, and and also, you know, how did you get into the role in customer loyalty, customer experience?
• 6:04
  SPEAKER_00: Yeah, for sure.
• 6:05
  SPEAKER_00: So I actually started at Air Canada and AirPlan, so that's why I'm never disparaging about the uh the competition.
• 6:11
  SPEAKER_00: I was the finance guy for marketing at uh at Air Canada and and got more interested in the marketing and loyalty side of things and the finance side of things, and so I did that for a dozen years.
• 6:22
  SPEAKER_00: I've been at WestJet now for five years.
• 6:25
  SPEAKER_00: Um, and most of my day-to-day is actually our Cobran credit card.
• 6:29
  SPEAKER_00: That's the the lion's share of of what I'm focused on, um, along with uh I'll call it our non-air travel partnership.
• 6:38
  SPEAKER_00: So we have a car platform, a hotel platform, an e store, sort of other levers for engaging our members in our program.
• 6:45
  SPEAKER_00: But big focus on the Cobran credit card.
• 6:48
  SPEAKER_00: You alluded to it yourself before, the sort of focus on that because of the value it can drive.
• 6:52
  SPEAKER_02: Absolutely.
• 6:53
  SPEAKER_02: So when you look at your role, uh especially focused on that co-brand side, you know, what are the biggest challenges you see in your role for improving, enhancing customer experience within the organization?
• 7:05
  SPEAKER_02: And or maybe what are the biggest challenges you face?
• 7:08
  SPEAKER_00: Yeah, I think with on on the co-brand side, the the challenges there would be it just becoming a more and more competitive space.
• 7:18
  SPEAKER_00: If we look at the the the sort of competition set, there would be 10 more credit cards in the premium travel uh credit card space in Canada now than what there were, say, five or six years ago pre-COVID.
• 7:30
  SPEAKER_00: So it's it's more and more competitive um all the time.
• 7:34
  SPEAKER_00: That that would would for sure be the biggest challenge.
• 7:37
  SPEAKER_00: I think when you have got folks into your program and you've got them engaged with your credit card, if you have a good product, you've got a pretty good chance of maintaining them and keeping those folks spending because you kind of get hooked on the points and being able to redeem and the free flights and all that sort of thing.
• 7:54
  SPEAKER_00: It's the how do I get somebody who does not have my co-brand card and they may not even be a member of my program yet?
• 8:00
  SPEAKER_00: How do I get them to take a look at that and get them to understand the value that I'm offering versus the competitors out there and and sort of get them across and get them in?
• 8:10
  SPEAKER_02: Yeah, and then that's uh a question we like to ask too uh pretty consistently is you know, when you look at uh getting consideration and then getting uh you know choice, with lots of choice up there.
• 8:20
  SPEAKER_02: So how do you get in to be in the consideration set uh of a travel program, right?
• 8:25
  SPEAKER_02: And then once you get into that consideration set, how do you flip them?
• 8:28
  SPEAKER_02: How do you get them to be that card of choice?
• 8:31
  SPEAKER_00: Yeah, so I'd say we're lucky in that we partner with Royal Bank of Canada, and that's the number one bank in Canada.
• 8:37
  SPEAKER_00: So they've got a fabulous client network of their own.
• 8:40
  SPEAKER_00: And it ends up being one of those, you know, very symbiotic relationships.
• 8:44
  SPEAKER_00: We got a bunch of members who aren't bank customers, and they got a bunch of customers who aren't necessarily yet WestJet flyers.
• 8:50
  SPEAKER_00: And so so having each other's uh you know pools available to us.
• 8:54
  SPEAKER_00: Um yeah, how do how do we get them in?
• 8:57
  SPEAKER_00: We change our mind on that about every three or four months when it's like, what's our next hook or what's our next uh what's our next offer?
• 9:03
  SPEAKER_00: I'll give you like the the the current and certainly what we're seeing in Canada is sort of total value messaging.
• 9:09
  SPEAKER_00: Do it in a way that it's something that tangibly the member can can say, got it, I'm gonna get.
• 9:16
  SPEAKER_00: Don't tell me how many points and check bags and companion vouchers necessarily.
• 9:20
  SPEAKER_00: Tell me what they're worth.
• 9:22
  SPEAKER_00: So and and do it in a way that it doesn't look like you're making up numbers that are just trying to get as sort of high as you can.
• 9:28
  SPEAKER_00: Um that's that's the current, the sort of current trend that we're seeing here in Canada, I'd say.
• 9:34
  SPEAKER_00: Um and it can depend a bit whether we're fishing in our own on with our WestJet reward members versus fishing, you know, out in out in the public and and where we're trying to stand out as well.
• 9:46
  SPEAKER_02: You talk about value.
• 9:48
  SPEAKER_02: It's a big uh area focus discussion within our community, uh it's you know, especially in hospitality.
• 9:55
  SPEAKER_02: Uh but many programs right now are you know trying to change the program.
• 10:01
  SPEAKER_02: Uh some would say maybe devaluing the program, right?
• 10:03
  SPEAKER_02: It's kind of the old Jedi mind trick.
• 10:05
  SPEAKER_02: Oh, we're not gonna give you uh a point for every mile, so we're gonna give you a half point, but we're gonna give you a free cookie every third time you fly.
• 10:12
  SPEAKER_02: Well, I don't want that cookie, right?
• 10:14
  SPEAKER_02: I want the program.
• 10:15
  SPEAKER_02: So we realize there are some challenges economically that may push some of these, but it it's it's you mentioned that transparency, value, making it easy to understand.
• 10:27
  SPEAKER_02: Uh you know, what we see from you know being in the industry is that some brands create a lot of complexity, right?
• 10:33
  SPEAKER_02: We're gonna uh give you this uh these two benefits, but man, to get a hotel used to cost me 25,000, 30,000 points.
• 10:40
  SPEAKER_02: You know, I don't see anything under 50-80 now.
• 10:42
  SPEAKER_02: So what's going on, right?
• 10:43
  SPEAKER_02: So do you three do you think that creates some dissonance with customers, right?
• 10:49
  SPEAKER_02: Because you know, they they know the program may be changed or devalued, but it's not being presented to them in that way.
• 10:56
  SPEAKER_02: And if so, how how how do you how do how do you, how do we, how does the industry you know do that better?
• 11:03
  SPEAKER_00: Yeah, I'd say specifically for WestJet, we probably advantage from the fact that we're still a relatively young program.
• 11:11
  SPEAKER_00: So we're 15 years old.
• 11:13
  SPEAKER_00: We've actually just gone through our own sort of revamp last year as a program, but we come from a place where it's a pretty simple program.
• 11:22
  SPEAKER_00: It bef before the the changes we introduced, you earned WestJet points for flying on Westjet.
• 11:28
  SPEAKER_00: You earned Westjet points if you had a co-brand card, and you could redeem your WestJet points toward the base fare of a flight.
• 11:35
  SPEAKER_00: That was it.
• 11:36
  SPEAKER_00: That was all we had a WestJet dollar, which was super transparent and simple.
• 11:40
  SPEAKER_00: One WestJet dollar equals one Canadian dollar.
• 11:43
  SPEAKER_00: So every time you'd front up to redeem, you just knew, okay, I got 78 WestJet dollars, I'm gonna get 78 bucks off the flight I'm booking today.
• 11:51
  SPEAKER_00: And so it part of our change was actually going from WestJet dollars to WestJet points.
• 11:57
  SPEAKER_00: So arguably feeding into a bit of that trend you're mentioning about oh my goodness, are we making it more complex and all that sort of thing?
• 12:04
  SPEAKER_00: And then simplicity is one of the core principles we have in our program and that we try to stick to.
• 12:10
  SPEAKER_00: Um we found we needed to go to points if we wanted to grow our program beyond that sort of that was fairly unidimensional as just a flight program.
• 12:21
  SPEAKER_00: Um the benefit we had being a younger program is that we didn't offer a lot of the other good things or the other utility that more mature programs did.
• 12:32
  SPEAKER_00: So in introducing a change, like going from one WestJet dollar to 100 WestJet points, we're also able to introduce you can now earn those points on ancillary purchases, or you can now redeem those points on ancillary purchases or taxes and fees.
• 12:50
  SPEAKER_00: So uh in our case, we were fortunate in that coming from a relatively call it bare base, we could introduce more utility to the currency at the same time that we're making a change.
• 13:02
  SPEAKER_00: And and so on balance, that can be acceptable to a member.
• 13:05
  SPEAKER_00: It's not just a devaluation or a taking something away.
• 13:09
  SPEAKER_00: Um the the other thing I'd say there was we were really deliberate in our change, in that one WestJet dollar equals 100 WestJet points, because that's easy math to do.
• 13:19
  SPEAKER_00: Everybody can do that, you know, it's not like a one to 90 or a two to three, or and when you redeem on a flight now, a hundred WestJet points get you a dollar off your flight.
• 13:30
  SPEAKER_00: So so sort of nothing has changed from that perspective perspective.
• 13:34
  SPEAKER_00: So just trying to make that easy for the member to understand and and see that there's no Jetto mind tricks here or or or sort of shenanigans happening.
• 13:45
  SPEAKER_00: That that's the way we try to try to balance that one.
• 13:48
  SPEAKER_02: That makes perfect sense.
• 13:50
  SPEAKER_02: So you talked about a little bit, uh customers are changing in many industries right now.
• 13:54
  SPEAKER_02: Uh they want simplicity, they want value, they want that reciprocity.
• 13:59
  SPEAKER_02: You know, how do you see customers changing in kind of the larger travel hospitality uh programs?
• 14:06
  SPEAKER_00: Yeah, I think like for sure they're looking for more value.
• 14:10
  SPEAKER_00: Um I would say they're looking for better, just I'll say experiences, and I guess that can can sort of go across from my booking experience on your website or in your app to my onboard experience with you know with your with your product to there is now a flight disruption and you need to to handle this in in some way for me, my missing bag or my reconnecting me, given the technology available to us now, sort of across all of those things almost, there is an expectation that uh that you as an airline or you as a loyalty program can deliver that a lot more seamlessly for a customer, and in a way that takes the the work or the effort off of them, you know, we should be able to see things and and and be ahead of things.
• 14:57
  SPEAKER_00: Um so it's uh yeah, it's it's purely if you boil it down to the the points, nuts and bolts of loyalty value, but it's sort of that customer experience element as well, make things easy for me.
• 15:09
  SPEAKER_02: No, uh yeah, that's uh that's good, great.
• 15:11
  SPEAKER_02: Um when you look at customer loyalty, you know, what does customer loyalty mean to you, to WestJet?
• 15:18
  SPEAKER_02: Uh you know, you yeah, how how do you define it?
• 15:21
  SPEAKER_00: Yeah, for me it's like it's it's the person who chooses to fly with WestJet, as opposed to you're the only airline in town, and so I begrudgingly have to fly you, if you're like um and the choose could be two levels, and and I'll probably take either level at this point.
• 15:38
  SPEAKER_00: Um it could be transaction by transaction.
• 15:41
  SPEAKER_00: I got to book a flight today, I need to make a choice.
• 15:44
  SPEAKER_00: Is it gonna be WestJet, Air Canada, Porter?
• 15:46
  SPEAKER_00: I got to book a flight next week, same thing, I gotta make that choice.
• 15:49
  SPEAKER_00: So if they choose me, that's good.
• 15:51
  SPEAKER_00: I'll take that.
• 15:52
  SPEAKER_00: What we love even better, and although a a customer or a guest is still making a choice, they're not actually doing that shopping anymore.
• 16:01
  SPEAKER_00: I have had such good experience with WestJet when I have flown with them.
• 16:05
  SPEAKER_00: I am now just automatically choosing WestJet next time I fly.
• 16:09
  SPEAKER_00: So I'm not even shopping around to see what the other guys are offering.
• 16:13
  SPEAKER_00: They're just, they're my team.
• 16:14
  SPEAKER_00: They're who I'm flying with.
• 16:16
  SPEAKER_00: So if it starts on that sort of transaction by transaction and you make a choice for us, great, we'll take it.
• 16:22
  SPEAKER_00: If we can can give you that sort of great experience every time you do, do fly with us to the point where you're now just like, okay, I'm in, I'm in with West Chet.
• 16:31
  SPEAKER_00: I don't even need to shop around.
• 16:32
  SPEAKER_00: That's that's the loyalty we're really looking for.
• 16:35
  SPEAKER_02: And when you look at that deeper loyalty, uh, those connections you talk about, listening to your customers, which you talked about is a big focus, you know, prioritization of a program internally is very important.
• 16:47
  SPEAKER_02: Uh many brands will speak to the fact that they may have it prioritized, but then you know, the kind of the actions may not be the same, right?
• 16:54
  SPEAKER_02: They have someone very junior running the program, it doesn't have a seat at the table across, you know, uh different uh facets of marketing.
• 17:02
  SPEAKER_02: You know, how how is the customer loyalty, the loyalty program prioritized within WestJet?
• 17:07
  SPEAKER_00: Yeah, so I'm glad you're asking me this question this year as opposed to two years ago, because I can I can point to the fact that we did a loyalty revamp last year, which was one of the big three investments that WestJet made as an airline last year.
• 17:21
  SPEAKER_00: So at the moment, it it's good.
• 17:24
  SPEAKER_00: You know, loyalty, loyalty's got got good profile, the value's pretty well understood internally.
• 17:29
  SPEAKER_00: We got a VP of loyalty who reports into the chief commercial officer.
• 17:33
  SPEAKER_00: So, you know, in the same way the the VP of revenue management reports into the chief commercial officer, or the VP of sales reports into the chief commercial officer.
• 17:41
  SPEAKER_00: So that's that's our seat at the at the executive table.
• 17:45
  SPEAKER_00: Um, yeah, I would say it is probably night and day between now and five or six years ago, in terms of that that that buy-in at the company level around loyalty.
• 17:58
  SPEAKER_00: That just comes with education and understanding.
• 18:01
  SPEAKER_00: And I mentioned before, we're a relatively young program.
• 18:04
  SPEAKER_00: Um, and so it just sort of comes along the you know the maturity spectrum there.
• 18:08
  SPEAKER_00: I think, you know, just sort of makes sense.
• 18:11
  SPEAKER_02: That makes perfect sense.
• 18:12
  SPEAKER_02: Can you can you walk us through the program a little bit?
• 18:14
  SPEAKER_02: Uh the West Hat Rewards program, you know, how kind of the benefits that are offered.
• 18:19
  SPEAKER_02: I know you have different tiers, teal, silver, gold, platinum.
• 18:22
  SPEAKER_00: You know, tell us a little about the program.
• 18:24
  SPEAKER_00: Yeah, for sure.
• 18:25
  SPEAKER_00: It uh yeah, probably looks and smells a lot like other frequent fly programs that are out there.
• 18:30
  SPEAKER_00: Um so WestJet Points is a currency that we use.
• 18:32
  SPEAKER_00: Anyone can join, it's free to join.
• 18:35
  SPEAKER_00: Um, and then you know, at the at the most basic level, you can earn WestJet points for flying on WestJet, and you learn that on your flight, on your ancillaries, on your surcharges, sort of on everything there.
• 18:48
  SPEAKER_00: You can earn points through our Cobran credit card, which is obviously a very popular way to do it, and and and uh you know how most people are are earning their points.
• 18:58
  SPEAKER_00: Uh, you can earn when you book cars or hotels through our car or hotel booking platforms.
• 19:04
  SPEAKER_00: We've recently introduced some everyday partners uh who you can also earn points with now.
• 19:09
  SPEAKER_00: So a good sort of variety of ways that you can earn points.
• 19:12
  SPEAKER_00: And then flip side, redemption flights is obviously the big one, but and you can redeem on ancillaries, surcharges, taxes, and fees.
• 19:20
  SPEAKER_00: You can buy you can get a free flight on us, um, which is something we quite like.
• 19:24
  SPEAKER_00: And then otherwise, redemption options.
• 19:26
  SPEAKER_00: We've got an e store for gift cards, merchandise, that type of thing, and the everyday partners who we've introduced.
• 19:32
  SPEAKER_00: You can now also redeem at.
• 19:34
  SPEAKER_00: Um, and so may I mention just briefly we have a telecommunications partner, TELUS.
• 19:40
  SPEAKER_00: We've got a delivery service partner, uh, Skip, who I think might be Grubhub in the US.
• 19:45
  SPEAKER_00: Yeah, yeah.
• 19:46
  SPEAKER_02: The brand that's been a press release about how you guys are partnering with that.
• 19:49
  SPEAKER_00: Perfect.
• 19:50
  SPEAKER_00: Uh, and then the last one's Canadian Tire, which uh which is a retailer here.
• 19:54
  SPEAKER_00: But that's great now.
• 19:55
  SPEAKER_00: In between those moments of travel, our members can earn points at all of those partners, and they can use their points at all of those partners as well if they want to.
• 20:03
  SPEAKER_00: So that's kind of the earn-burn mechanism.
• 20:05
  SPEAKER_00: Um and then in terms of the tiers that you mentioned, everyone's a teal member when they come into it, and then we do have a tier program, silver, gold, and platinum.
• 20:14
  SPEAKER_00: And it's basically through your flying activity and or your co-brand activity that you can make your way into those tiers.
• 20:23
  SPEAKER_00: So there's an element of that that that's unique about what we offer is that you can get to tier and even our very highest tier just through co-brand spend alone, which isn't something that every program will do.
• 20:37
  SPEAKER_00: Um, you can also do it through a combination of flight and spend.
• 20:40
  SPEAKER_00: We think it's pretty accessible.
• 20:42
  SPEAKER_00: $4,000 in flight spend would get you into our silver tier.
• 20:47
  SPEAKER_00: Or put it another way, if you spend$50,000 on a credit card per year and did$2,000 in flight spend, that would get you into our silver tier as well.
• 20:58
  SPEAKER_00: And then and then through the tiers, but pretty standard benefits, priority airport services, check bags, lounge access, seat selection.
• 21:07
  SPEAKER_00: And as you go up the tiers, you know, you get more or better, you know, from, for example, silver, you get six lounge vouchers, but a gold, you can unlimited lounge entry.
• 21:18
  SPEAKER_00: So pretty, pretty sort of standard in that.
• 21:21
  SPEAKER_00: I'd say we're we're pretty generous in terms of that tier program.
• 21:24
  SPEAKER_00: And that would come from it's only been established for about 10 years at this point.
• 21:30
  SPEAKER_00: And so Air Canada's was very well established when WestJets came in.
• 21:34
  SPEAKER_00: And so for for WestJet to kind of compete and be interesting against the Air Canada offering, probably had to put a bit more value in the tiers and than what you might, you know, than what you might see there in Canada, for example.
• 21:47
  SPEAKER_02: Okay.
• 21:48
  SPEAKER_02: You've talked a little bit about uh kind of the the new uh Cobran uh program, uh and and and you just mentioned too you can you can earn tier status by you know the spend on the cards.
• 21:58
  SPEAKER_02: Obviously, very engaging in.
• 22:00
  SPEAKER_02: That regard.
• 22:01
  SPEAKER_02: We'd love to know a little bit more about those customers, kind of the and but more importantly, you know, what are some of the benefits that uh are tied to the WestJet RBC World Elite MasterCard?
• 22:11
  SPEAKER_02: And you know, how has it uh elevated the customer multi-program in general?
• 22:16
  SPEAKER_00: Yeah, for sure.
• 22:17
  SPEAKER_00: I mean, benefit-wise, uh free free check bags is the big one.
• 22:22
  SPEAKER_00: And that's the one that consistently we hear from members is you know, is the one they value the most.
• 22:27
  SPEAKER_00: The second big benefit we have, which is unique to us uh in well was actually I should say now, because we were recently uh copied by Porter.
• 22:37
  SPEAKER_00: And if imitation is the sincerest form of flattery, then I guess we'll take it.
• 22:41
  SPEAKER_00: Uh is our companion voucher.
• 22:43
  SPEAKER_00: So every year with your co-brand card, you get a companion voucher, which allows you to bring a plus one with you on a trip uh for$119.
• 22:53
  SPEAKER_00: And so you could be you could be buying a fare that's worth$800, but you get to bring your companion along for$119.
• 23:00
  SPEAKER_00: So um, what do we see?
• 23:02
  SPEAKER_00: Last year in 2025, on average, people who use the companion voucher say$585.
• 23:08
  SPEAKER_00: So it's it's it's pretty telling value when you use it.
• 23:11
  SPEAKER_00: So check bags, companion voucher, and then of course, just your spend on the card is the other big one.
• 23:17
  SPEAKER_00: If you you get one and a half points per dollar, we've got some accelerator categories beyond that, but sort of put it, hopefully, what comes across as simply if you spent$30,000 a year on your credit card and it's our credit card, you would get at least$45,000 WestJet points, which is worth$450, which is$450 off your next trip.
• 23:40
  SPEAKER_00: So when you start to stack that stuff, I got$450 just from using my credit card the way I was going to anyway.
• 23:47
  SPEAKER_00: I got a companion voucher so I can bring my wife or my husband or my kids along and I save$585.
• 23:54
  SPEAKER_00: We checked our bags and it's on a round trip, and that's another$180.
• 23:59
  SPEAKER_00: Like you pretty quickly get to a point where you're getting thousands or more in dollars of savings per year just from getting the credit card and spending as you normally would.
• 24:09
  SPEAKER_00: You don't have to do anything extra or special necessarily.
• 24:12
  SPEAKER_02: That makes sense.
• 24:13
  SPEAKER_02: That's awesome.
• 24:14
  SPEAKER_02: You you spoke into it a little bit about kind of post-COVID, the changes you talked about in the organization last two years.
• 24:20
  SPEAKER_02: You've made a significant change, uh, a focus, more prioritization of the program.
• 24:25
  SPEAKER_02: You know, how critical the customer loyalty program uh has it has it been to the to the Western and the airline industry, you know, to entice people to start traveling in following COVID?
• 24:37
  SPEAKER_02: I know COVID's been a while back, but you was it a driver of the loyalty program?
• 24:41
  SPEAKER_02: Obviously, many uh airlines used it for funding, right?
• 24:45
  SPEAKER_02: United and others in the States here to get government-backed loans, and they you know it was more valuable than the airline itself.
• 24:52
  SPEAKER_02: But uh, you know, when you look at that, how is that program really driven uh re-engagement with the brand?
• 24:59
  SPEAKER_00: Yeah, no, it's it's a good point.
• 25:01
  SPEAKER_00: The like the monetization thing of programs is good.
• 25:04
  SPEAKER_00: The the other thing I'd that we sort of saw during COVID were there were months where airlines were getting more money in cash receipts from their Cobran credit card spend than they were in ticket sales, like when when nobody was was buying tickets.
• 25:18
  SPEAKER_00: So even just that that sort of base, you know, cash in, cash out.
• 25:24
  SPEAKER_00: So yeah, COVID wasn't a blessing for anyone, but in some ways for loyalty programs, it shone a bit of a spotlight on the value, and I think help accelerate acceptance of the value of the programs in some ways coming out of COVID.
• 25:37
  SPEAKER_00: Certainly, what we saw at WestJet was that it was Westjet Rewards members who were the first ones to come back and travel.
• 25:44
  SPEAKER_00: Um probably a couple of reasons behind that.
• 25:48
  SPEAKER_00: One, they're just by being a WestJet Reward member, you are more likely.
• 25:52
  SPEAKER_00: Uh there's an element of sort of self-selection there.
• 25:55
  SPEAKER_00: You're you're you're you're a traveler.
• 25:57
  SPEAKER_00: Um, but you've been building up points all the way through COVID on your cobran span, for example.
• 26:03
  SPEAKER_00: So you've actually got enough points to start traveling for free and you're more likely to come back because of that.
• 26:09
  SPEAKER_00: Uh airlines, including West Chat, had programs where your tier status was maintained right throughout COVID.
• 26:16
  SPEAKER_00: So you could restart where you left off, um, which which was a tool that the loyalty program gives the airline essentially to be able to encourage folks to to come back and and get traveling.
• 26:29
  SPEAKER_00: So for sure it was the rewards members who were first ones out of the gate on the WestJet side, um, and and sort of continue, continue to lead the charge, for sure.
• 26:40
  SPEAKER_02: When you look at the the younger generation uh traveler, you know, how is WestJet engaging with them?
• 26:47
  SPEAKER_02: Obviously, uh, you know, many younger people want to travel more.
• 26:51
  SPEAKER_02: They also want to be top-tier status in the program right away and they travel once, right?
• 26:55
  SPEAKER_02: So their expectations can be out of line sometimes.
• 26:58
  SPEAKER_02: Yeah.
• 27:00
  SPEAKER_02: You know, how are you engaging with younger talent uh travelers and are there some challenges that it may present based on kind of the traditional models?
• 27:08
  SPEAKER_00: Yeah, I I love that you you bring up that example of like they expect that they should get tier status, you know, on the first or second flight, they get.
• 27:15
  SPEAKER_00: We we were looking at some member satisfaction stuff recently, and this this ability for CoBrand to get you to tier is generally seen as a really great improvement.
• 27:24
  SPEAKER_00: But there's this pocket of members who are saying that because you have to spend, you know, like 50,000, 100,000, like a decent amount on your card, they feel disenfranchised by that because that feels like an amount they can't get to.
• 27:36
  SPEAKER_00: And when you dig into it, it's the it's the younger customers who might not have the salaries yet that sort of support that level of credit card spend and all the rest.
• 27:44
  SPEAKER_00: Somehow we've managed to disenfranchise them from what should be a good thing.
• 27:48
  SPEAKER_00: But it's it's a little bit their expectations.
• 27:51
  SPEAKER_00: And you know, maybe arguably we didn't build that product to satisfy their expectations, but it it does point to some of the challenges uh with a younger, with with a younger demographic, digitally native, informed and skeptical, value-driven, looking for more immediacy.
• 28:09
  SPEAKER_00: I mean, the good thing is I'd say like they will switch from brand to brand, I think is our experience.
• 28:16
  SPEAKER_00: But if you can build that trust with them, and if you can get them, then they they will become your advocates as well, because they're more likely to be doing reviews and posting and influencing or you know, whatever it is.
• 28:29
  SPEAKER_00: So although it it it could be fraught with danger, if you can build that trust, then then you've got yourself some some good brand advocates.
• 28:39
  SPEAKER_00: Um it's yeah, yeah, I'd probably leave it at that.
• 28:43
  SPEAKER_02: Excellent.
• 28:44
  SPEAKER_02: Okay, perfect.
• 28:45
  SPEAKER_02: Uh so AI, uh, it's uh something that everyone's talking about.
• 28:49
  SPEAKER_02: Uh some are scared, some are happy, some do not know what to think about it.
• 28:54
  SPEAKER_02: Uh, but you know, from a customer knowledge perspective, we've done a couple of studies there as well.
• 28:57
  SPEAKER_02: And it was kind of a it's still kind of a late entry, but brands are really starting to warm to it.
• 29:02
  SPEAKER_02: Uh some of the trepidations they have around data and governance have kind of subsided.
• 29:06
  SPEAKER_02: You know, how are you looking at AI?
• 29:08
  SPEAKER_00: Yeah, I I feel like I uh it's gonna feel like I'm trying to dodge the question.
• 29:13
  SPEAKER_00: I'm probably not the best person to ask, but here's what comes to mind for me.
• 29:17
  SPEAKER_00: For sure, the you know, talk about like say personalization, which has been a pretty hot topic for the last couple of years.
• 29:23
  SPEAKER_00: And does AI get us to hyperpersonalization?
• 29:26
  SPEAKER_00: Um, I wouldn't say we're great at personalization yet.
• 29:29
  SPEAKER_00: We've got room to improve there.
• 29:31
  SPEAKER_00: So do we get to hyperpersonalization as a quick next step?
• 29:34
  SPEAKER_00: We we've got some some work to do, but I think of AI in that kind of capacity.
• 29:39
  SPEAKER_00: I think of how it can help from an analytics perspective as well.
• 29:45
  SPEAKER_00: So propensity modeling or sort of predictive capabilities, next best action type type activities.
• 29:55
  SPEAKER_00: I think it's probably fair to say most folks have had models that may do that in the past.
• 30:00
  SPEAKER_00: They could be better now, but I think what AI can help you do is get to executing off of some of those more quickly than what you you otherwise may have done.
• 30:08
  SPEAKER_00: I think one of the areas where AI could be interesting is and and it's sort of almost whether we control it as the airline or whether this is just going to happen out there sort of through through agents anyway.
• 30:20
  SPEAKER_00: That travel companion type notion, trip planning, that sort of thing.
• 30:25
  SPEAKER_00: I'd love to see a world where it's now WestJet, like, you know, hey Mark, you're one trip away from gold status.
• 30:31
  SPEAKER_00: Want me to send you some ideas for your next trip to get there?
• 30:34
  SPEAKER_00: Um we don't do that, but could we do that?
• 30:37
  SPEAKER_00: Whereas, you know, I think all of us as consumers are probably using AI a little bit to, hey, I got three days to, you know, go to St.
• 30:43
  SPEAKER_00: John's Newfoundland or whatever.
• 30:44
  SPEAKER_00: What should I do?
• 30:45
  SPEAKER_00: What are the ideas?
• 30:46
  SPEAKER_00: Um there, there's there's absolutely that.
• 30:50
  SPEAKER_00: The other thing I'd say it is changing for us is a little bit the way we market and and the way we need to think about things.
• 30:56
  SPEAKER_00: So, for example, web pages, which in the past maybe needed to be optimized, like for search engine optimization.
• 31:03
  SPEAKER_00: Now they're got to be written or constructed, or you've got to have the right kind of tools, FAQs, calculators, comparisons, whatever it is, that it helps you be discoverable and show up in answer engine optimization and geo.
• 31:16
  SPEAKER_00: And it's just sort of pivots a little bit the way you you need to think about some of your marketing so that you're showing up where the consumers are.
• 31:24
  SPEAKER_00: Um, because they might be somewhere where they weren't a few years ago.
• 31:27
  SPEAKER_02: Excellent.
• 31:28
  SPEAKER_02: You know, uh AI's there.
• 31:31
  SPEAKER_02: Uh you talk about hyper-personalization.
• 31:33
  SPEAKER_02: It's funny because a couple years back that was uh I want to say 23, 24, that was all the buzz, right?
• 31:38
  SPEAKER_02: Hyperpersonalization, it kind of uh faded like blockchain and uh crypto in well, crypto now, but uh uh blockchain back in the day, right?
• 31:48
  SPEAKER_02: Kind of so you know what's the next big thing for customer loyalty?
• 31:53
  SPEAKER_02: Is it AI?
• 31:53
  SPEAKER_02: Is it just personalization?
• 31:55
  SPEAKER_02: Is it more empathetic engagement?
• 31:57
  SPEAKER_02: Uh you know, what's the next big thing for customer loyalty?
• 32:00
  SPEAKER_00: Yeah, I think and you hear it being talked about more and more is like that notion of emotional loyalty or capital L loyalty.
• 32:07
  SPEAKER_00: Yeah, like I the AI, I I like the example of blockchain.
• 32:12
  SPEAKER_00: So I remember sitting at some of the industry conferences 15 years ago and I kind of went, I don't get this, I don't see what this is going to do.
• 32:17
  SPEAKER_00: But the people smarter than me seem to think that maybe it was, and ultimately, you know, sort of nothing came from it.
• 32:23
  SPEAKER_00: So AI will be there, but to the extent we can sort of harness that and come up with real value add use cases, um it it will play a role.
• 32:33
  SPEAKER_00: But yeah, I think it's that capital E or capital L uh or emotional loyalty, um, which is probably being partly driven by almost that younger demographic I talked about before, and then becoming brand ambassadors and sort of catering to them a little bit more, and and they're going to be the travelers of of tomorrow.
• 32:54
  SPEAKER_00: Um I think that's probably it's probably a bit of an easy answer because everyone talks about emotional loyalty these days, but that's that's probably where I'm tending on that one.
• 33:03
  SPEAKER_02: Okay, perfect.
• 33:05
  SPEAKER_02: So, you know, when you step back, you look at the program, you obviously on the partnership side for WestJet, uh, you know, what are two or three things you're most proud of when you look at your customer loyalty program?
• 33:16
  SPEAKER_00: Yeah, I think the the change that we've been able to make in the last 12 months uh and the and the utility we've been able to bring to the program, um, we've introduced three big national Canadian brands as partners.
• 33:32
  SPEAKER_00: We've refreshed our co-brand credit card products so that members now earn more.
• 33:36
  SPEAKER_00: So that companion voucher I talked about has got flexible options for people who don't travel with a companion, for example, and and and a whole bunch of things.
• 33:45
  SPEAKER_00: So I think just the the amount of ch I'll say positive change that we've been able to introduce in in the last 12 months and I think bring our members along for the ride with us, do it in a way that we've been able to explain it to them that it is, I'll say hopefully, but from what we see, I think largely has made sense to them or been understandable to them, and and that we've been able to to to to bring them through that process with us.
• 34:14
  SPEAKER_00: I'd say we're not done yet.
• 34:15
  SPEAKER_00: There's still more utility to bring, there's still more more partners to bring into the program.
• 34:20
  SPEAKER_00: Um, but that'd be that'd be what we're most proud of in the last year or so.
• 34:25
  SPEAKER_02: Byron, thank you very much for taking the time to join us today.
• 34:27
  SPEAKER_02: It's great hearing more about WestJet and how they continue to evolve, their customer loyalty approach, how you are looking at the customer in very unique ways, trying to bring value to them at every turn.
• 34:39
  SPEAKER_02: Uh it was a great pleasure speaking with you, hearing your passion for the customer, the brand, and the program.
• 34:45
  SPEAKER_00: Beauty.
• 34:45
  SPEAKER_00: It was great to uh great to be here, Mike.
• 34:47
  SPEAKER_00: Appreciate the questions.
• 34:48
  SPEAKER_02: And thank you to everyone for tuning in today.
• 34:51
  SPEAKER_02: It was great having you on the Leaders in Customer Loyalty Podcast, the Brand Stories Edition.
• 34:55
  SPEAKER_02: Be sure to check back every Thursday for a new edition with the brands that are shaping the future of customer loyalty.
• 35:02
  SPEAKER_02: Make sure to subscribe and follow us on YouTube, LinkedIn, and our other social media channels.
• 35:08
  SPEAKER_02: The comment section below will have links to them as well.
• 35:11
  SPEAKER_02: Looking forward to seeing you next Thursday.
• 35:12
  SPEAKER_02: Thanks.