American Express is exploring the use of its Membership Rewards program to help corporate accounts corral traveler behavior by offering them loyalty points for complying with policy. The concept now is being offered to small accounts, typically those with less than $3 million in U.S.-booked air volume, but American Express One vice president John Berkley today said, "In the $3 million and higher category, and obviously in the large market, you do have travel managers looking to influence traveler behaviors, and this could be of use to them, so some things are in development."
Travel buyers have used frequent flyer programs to drive compliance with preferred airlines, but Amex's concept could be applied to more policies or vendors. "It's a novel idea of getting the company a carrot program to incent the proper behavior," Berkley said. "We've been thinking the same thing, but we're not prepared to discuss that right now."
In the program announced today for small companies, which typically do not employ a manager who could run such a program, American Express is offering automatic double points for travelers booking air travel with American Express using their American Express card.
Like some other recently announced initiatives, the program partly is driven by new capabilities within the Membership Rewards program to import travel booking data from the agency to indicate where extra points are to be allocated. "I don't think Membership Rewards a few years ago was up to the task of having lots of parts of Amex or preferred vendors like Delta be able to do this whenever they wanted," Berkley said. "During the past two years, you're seeing more double reward promotions, so as the program has matured and made technological investments, it can open the door as long as you can deliver the data in this format." Such data include the price of the airline ticket, which dictates the number of points, the traveler's name and the form of payment, which has to be Amex.
In combination with a new program in which Amex will match or pay the difference on any bookable fares that travelers find elsewhere (excluding consolidators, soft-dollar fares and auction sites), Berkley said the loyalty program should help companies cut down on leakage from their designated agency programs and offer senior executives reasons to create such designations. "In smaller companies, more of the travelers are the company principals or top sales people, and many of them decide against enforcing a travel management program," he said. "It's our job to convince them they should."
Amex's travel program for small companies requires $5 per transaction and a $500 to $2,000 enrollment fee, depending on how many of the client's negotiated fares and rates need to be loaded into the booking systems.
Meanwhile, American Express is studying its branding in terms of what is most appropriate for each customer segment. Berkley said the company shied away from using the American Express One brand in today's announcement because "that brand name is not big with the average traveler in the general population. Since this has direct traveler benefits, we wanted to make it simpler." Berkley referred to changes relating to the positioning of Amex One, which serves clients with less than $10 million in air travel. He reports to Stephen Power, who no longer serves as American Express One's vice president and general manager. Power's title now is senior vice president of the service delivery network for American Express Corporate Travel, and he leads all Amex interactive, onsite and callcenter operations.
American Express One is the former Travel One, which Amex acquired in 1998
(BTN, Oct. 26, 1998). At the time, Amex said it would run Travel One as a separate unit for the foreseeable future. Amex's Rosenbluth International acquisition last year was different in that the acquired company was more deeply absorbed.