Etihad Airways said it’s seeking partners from the retail, finance and telecommunications industries in order to transform its frequent-flier plan into a wider-ranging lifestyle program.
The Gulf carrier wants to develop a loyalty model that differs from those at rival operators in extending outside the travel sector, Chief Commercial Officer Peter Baumgartner said in Edinburgh, where the airline began flying last week.
“We want to develop the most relevant loyalty offering in the world, where one card does all,” Baumgartner said in an interview. “That means going beyond partnerships with a travel aspect. It might mean your local grocery shop, your telecoms or roaming provider, financial services and banks.”
Etihad has spent almost $500 million buying control of frequent-flier programs at carriers in German, India and Italy, in which it also has taken equity stakes and provides management input. The lifestyle plan, which will make the loyalty concept a revenue generator as well as a marketing tool, should be announced in “a couple of months” and comes as there are no immediate plans to buy additional airline stakes, Baumgartner said.
Abu Dhabi-based Etihad’s Chief Executive Officer James Hogan said in London in March that car-rental firms such as Alamo are among leaders in extracting the maximum benefit from the passenger information to be gleaned from loyalty programs.
A deal to purchase 49 percent of Rome-based Alitalia last August took the company’s network of equity partners anchored by minority stakes to eight. While there are barriers to airlines buying majority control of foreign counterparts, that’s not so of loyalty programs.
Etihad has purchased 70 percent of Air Berlin’s Topbonus plan for 184.4 million euros ($208 million), 50.1 percent of Jet Airways (India) Ltd.’s JetPrivilege for $150 million, and 75 percent of Alitalia Loyalty -- which owns the Italian airline’s MilleMiglia program -- for 112.5 million euros.
The three FFPs and Etihad Guest, which are all run by the Gulf airline’s Global Loyalty Co. arm, have a total of 14 million members, according to Etihad’s website.
Though other industries may be working towards similar ends as Etihad’s lifestyle strategy, there has been nothing as far-reaching among airlines, Baumgartner said, with Air Canada’s Aeroplan approach coming closest.
Aeroplan was created in 1984 and became the first publicly traded program in 2005 when a 12.5 percent stake raised $250 million. It bought Loyalty Management Group, operator of Nectar, Britain’s leading loyalty program, in 2007, before severing ownership ties to Air Canada and rebranding as Aimia Inc.