How Travel Can Seed Loyalty by Marketing to College Students
The pressure’s on to acquire new customers, but the good news is they may be closer than you think – young people are already in your orbit.
Many of your high-frequency customers have kids who are coming of age who will soon be out on their own, and they’re already experiencing your brand. They’re travelling with their parents on vacations and visiting colleges they might attend. They’re even using their parents’ loyalty points for their own excursions. Now is the time to take advantage of this proximity and nurture their loyalty directly.
Student Loyalty Has Vast Potential
Brand loyalty is already percolating with this younger generation of travelers, whether they know it or not – which presents a big opportunity for airlines, hotels, car rental companies and others ready to kindle more deliberate loyalty.
According to EY Hospitality Trends, millennials will dominate purchases in the travel industry by 2020. College students, who are already travelling for tourism, study, work, spring breaks, volunteerism, college visits, etc. represent one-fifth of all international arrivals. And since this demographic tends to be more interested in collecting experiences than tactile goods, travel figures prominently on their bucket lists.
Smart companies are already dialing in their marketing campaigns to capture their share of this highly valuable student demographic. Delta Air Lines calls this under-35 set “Emerging High Value Customers” (eHVCs.) This segment, which Delta CMO Tim Mapes said is increasingly important to the airline’s revenue, is estimated to account for 50% of the company’s sales by 2020.
For Delta and other travel brands looking to differentiate in an otherwise commodity market, there’s an urgency in reaching this audience. As Mapes told Skift: “They’re high-yield business customers that we’re catching upstream and trying to build relations with them — in some cases while they’re still in college.”
Delta has found that younger consumers are 60% more likely than non-millennial travelers to buy-up to premium products, such as seats with extra legroom and first class upgrades. They’re also more likely to spread the word: 97% of those eHVCs will post something to social media immediately following their travel experience.
Connecting with young travelers pays off. Sixty percent of millennials said they are “often” or “always” loyal to brands that they currently purchase. Among the Gen Z crowd, two in three said rewards programs influence where they shop, and that once they find a brand they like, they will continue to buy for a long time. According to Deloitte, college students have a customer lifecycle of 10 years. Win them over now and they’re poised to become long-term customers.
Gated Offers Are a New Tool for Inspiring Student Loyalty
One of the most effective ways to capture the attention of this younger consumer base is throught gated, exclusive offers – targeted promotions based on life stage (college student, recent graduate), occupation (teacher) or affiliation (military).
Gated offers are a highly effective seed marketing strategy, allowing you to establish a positive relationship when students’ brand affiliations are still forming. The process is simple:
- Provide students with a special offer at a time when they’re earning less, such as a reduction on hotel rates or airfares during their spring breaks.
- Nurture them with special promotions or appealing perks like free drinks, baggage checks and service upgrades to make them feel special. This will build brand affinity early, planting the seeds of lifetime loyalty.
- Leverage that loyalty when they can pay full price. What begins as an exclusive discount when they are students on a budget can evolve to a VIP offer when they are in the workforce and willing and able to pay for premium travel experiences.
The success of this approach can be staggering. One major streaming music service has a gated offer that gives students a 50% discount, and 98% of those students convert to full price when they graduate. And in the first 12 months of expanding the gated offer internationally, the company doubled the number of student customers.
Gated Offers Facilitate Student Loyalty – and Pay Off
Every travel marketer wants to cultivate loyal customers, and gated student offers are a highly effective way to do that. Gated offers create an immediate connection between you and your customer, giving them a compelling reason to bypass online travel agencies and build awareness, trust and loyalty directly with your brand.
And when it comes to younger customers specifically, gated offers:
- Accelerate the purchase process. 54% say they feel excited and 81% are more likely to shop with a brand.
- Create brand enthusiasm that’s contagious. 83% say they would share an exclusive offer with friends and family.
- Generate revenue. Our work with major brands has shown that 90% or more of students that redeemed a gated offer stay loyal to the brand and begin paying full price when they graduate.
For more information on boosting your customer loyalty program by adding gated, exclusive offers, read our previous blogs: