Reversing the Loyalty Decline: Real-Time Marketing Tactics for Travel Marketers

When airlines introduced frequent flier programs in the early 1980s—quickly followed by hotel chains—they changed the game for customer retention in travel. The premise was simple: reward loyal behavior with valuable perks like free flights, room upgrades, and VIP treatment. In return, travelers were more likely to stay loyal, choosing familiar brands over competitors.

And it worked. For decades, loyalty programs helped travel companies build predictable, repeat business by literally rewarding consistency.

But the landscape has changed.

Loyalty Programs Are Losing Their Edge

Surveys by McKinsey highlight a sharp decline in customer enthusiasm for loyalty programs across airlines, hotels, and cruise lines. Between 2021 and 2023, there’s been a clear drop in how likely members are to recommend these programs—a key sign that traditional loyalty strategies aren’t hitting the mark. Travel brands have increasingly found themselves prioritizing the revenue-generating aspects of loyalty programs over their original purpose as tools for shaping customer preferences and enhancing travel experiences.

As McKinsey puts it, loyalty isn’t just a program, a team, or a set of rewards. It’s rooted in real relationships and delivering long-term value. For travel brands, that means moving toward smarter, real-time engagement that builds trust and keeps customers coming back.

Using Real-Time Marketing to Strengthen Customer Loyalty

At Relay42, we’ve partnered with leading travel marketers for over 15 years, helping them make their marketing programs smarter, faster, and more impactful.

The foundation of a successful loyalty program lies in personalization. To move beyond one-size-fits-all tactics, brands need the ability to collect and unify real-time data across transactions and customer interactions—from web and mobile to email and even direct mail. Traditionally, loyalty strategies rely on known customer data and past purchases, activated across a brand’s owned channels. But by tapping into real-time behavior, marketers can deliver more relevant, timely offers and incentives that truly resonate—driving deeper engagement and long-term loyalty.

Here are a couple of tactics travel and hospitality marketers can apply to elevate their loyalty programs using real-time marketing.

1. Capture Real-Time Customer Data

Loyalty programs work well to drive repeat business and improve Customer Lifetime Value—but they become significantly more effective when offers are personalized based on real-time behavior. Capturing and acting on that data is the foundation

Key data points to collect:

• Transaction data: Booking confirmations, hotel stays, flight purchases, upgrades, and ancillary spend.
• Real-time engagement: On-site purchases (spa, dining, transport), app and website interactions, email opens, and past redemptions.
• Cross-channel behavior: In-store activity, partner merchant spend, and mobile check-ins.
• Loyalty history: Reward preferences, redemption frequency, and total lifetime loyalty value.
  
  

2. Real-Time Points Allocation

Customers love instant gratification. Delivering rewards or points in real time adds excitement and can drive higher program engagement.

Examples of automated, real-time points allocation:

• Booking a flight → Points added immediately in-app
• Hotel check-in → Welcome bonus points credited instantly
• Completing a dining experience → Bonus points posted within minutes
  
  

3. Dynamic and Gamified Loyalty Tiers

Gamification increases engagement. Travelers are more likely to interact with loyalty programs when experiences feel rewarding and competitive, or when they see others earning more.

Gamification features to consider:

• Real-time tier progress updates: “You’ve just reached Gold Status—enjoy free upgrades on your next trip!”
• Time-limited challenges:
“Earn 1,000 bonus points if you book within the next 48 hours.”
• Leaderboard comparisons:
Show users how they rank against similar traveler segments.
  
  

4. Cross-Channel Loyalty Engagement

Loyalty shouldn’t be locked into a single channel. Omnichannel engagement ensures that rewards feel integrated and accessible, wherever your customers are.

Strategies for cross-channel loyalty:

• In-app promotions:
  “Exclusive for you: Use 2,000 points for a free airport lounge pass!”
  * Email & SMS updates:
“Your points have been updated! See your latest rewards here.”
• Partner integrations:

  Let users earn and redeem across airlines, hotels, restaurants, and experiences.
(E.g. A hotel stay unlocks discounts on future car rentals.)
  
  

5. AI-Driven Predictive Offers & Redemptions

AI is transforming loyalty marketing, enabling brands to anticipate customer needs and deliver highly personalized experiences at scale.

AI use cases for loyalty:

• Smart redemption suggestions:
  Recommend the most relevant reward based on past behavior.
• Dynamic travel-based offers:
“You often visit NYC—use 5,000 points for a hotel upgrade!
• Personalized expiry alerts:
“Your 2,500 points expire in 7 days. Redeem now for a free breakfast!”
  
  

6. Post-Redemption Engagement & Retention Strategies

Redemption shouldn't be the end of the journey—it’s a key opportunity to keep the momentum going. After a customer uses a reward, marketers should follow up with meaningful engagement that drives the next action and reinforces brand loyalty.

Smart follow-up strategies:

• Thank-you messages with bonus offers:
  “Thanks for redeeming your free spa visit! Enjoy 15% off your next booking.”
• Personalized recommendations:
  
“Loved your last stay in Bali? Use your points to upgrade to a suite next time.”
• Loyalty program feedback: 
Send short surveys to gauge how valuable customers find their rewards, and uncover opportunities for improvement.
  
  

Ready to take your loyalty strategy to the next level?

Explore our Playbook for Travel & Hospitality brands, where we break down 7 powerful, real-time, data-driven use cases designed specifically for marketers in the travel and hospitality industry.