BTN Europe presents an overview of business travel and MICE predictions for this year
Virtual Event - 1 October 2020
ExCeL London - 22-23 June 2021
Karhoo’s Chris Treadwell explains how Mobility as a Service (MaaS) has the potential to be a game changer in the loyalty space
Every few years, in their search for customer engagement and new revenues, loyalty clubs strike gold. They figure out a new way to expand their membership experience. They know that the wider their spectrum of services, the more likely a club member is to remain loyal to the participating brands and spend more money.
There’s a chance that I choose a particular airline, hotel, or retailer just because I’m a member of its frequent flyer, frequent guest, or retail programme. There’s a better chance I would pick that company if the loyalty programme has choice and relevance. If they let me use the loyalty currency on relevant products while earning points on a wider range of goods and services, then I’m never going to go anywhere else. It’s no wonder we now see developments among loyalty clubs towards becoming the most expansive and relevant to customers.
The expansion of global loyalty clubs is dependent on technological leaps, which enable services to be aggregated on a single platform.
For example, now that almost every hotel can be booked online, a platform like Hotels.com can offer its members a free night after every ten stays. This simply could not have happened before hotel reservation was successfully digitised and aggregated. Suddenly, any loyalty club can sign a deal with the hotel platform and offer a relevant product to its members.
Mobility as a Service (MaaS) is set to transform how the world travels in the future, by transitioning away from private car ownership towards a system where people choose the form of transport depending on their needs and preference. Whether they want to take a bus, taxi, bike, scooter, or rent a car to reach their destination, the choice will be up to the user and available at the press of a button.
The aggregation of MaaS will unleash unlimited innovation of loyalty clubs. Think about a frequent flyer club booking an airport chauffeur service for its passengers based on real landing time and live calculation of local fleet availability in each airport around the world. How about a railway company whose trains automatically alert and book local taxi drivers for interested passengers at each station? The system could even alert cab firms to delayed trains, which could lead to increased demand. Drivers could be brought on shift to take the burden from frustrated passengers before they even know it. Technologically, such solutions are simple. The challenge is ensuring the algorithm books the most relevant taxi provider at any given moment and in any given place. That requires more than a new mobility app; it requires new mobility thinking.
Don’t replicate. Aggregate!
Previous attempts to digitise the ride-hailing services followed a similar idea of recruiting drivers onto a new digital platform. This has previously proven extremely difficult to scale beyond major cities and to survive complex regulation, which varies greatly across borders. Up to now, no player has been able to provide an extensive global solution.
This is now changing. Instead of seducing taxi drivers to switch employers, emerging platforms such as Karhoo are onboarding entire taxi fleets onto one marketplace. Such platforms allow real-time comparison for customers. They provide a much more efficient solution for rapid scaling across all continents. They are covering regions, often with spread out populations, which no mobility platform has even attempted to reach before.
In this way, these new platforms have solved the technological, legal and logistical aspects of mass chauffeur service aggregation. We are doing to the private hire car industry what Amadeus did for the airline industry 30 years ago, through digitisation of distribution.
What is yet to be defined is the way in which loyalty clubs will use the new service in order to boost their offering. Creativity will be the name of the game. Integrating such an offering into platforms is now relatively easy. The more interesting part is to see how to create service synergies, which can boost user experience and engagement. Imagine a world where you tell your device that you need to meet a client in Amsterdam at some point in January. The device finds a slot in both your diaries, books the hotel and all the transport to and from without you doing any more. The next thing you need to do is pack your bag. What kind of integrated services could low-cost airlines provide when competitive taxi services are available even in the remotest airports? Or what kind of inter-modal smart city services would emerge when mayors see MaaS solutions empowering taxi drivers rather than endangering their jobs?
Some of the global giants have already pioneered this new trend. Rail companies SNCF (France), Thalys (France and Benelux) and Renfe (Spain) and a major international OTA recently sought a taxi company partner in order to provide an integrated last-mile mobility service for their clients. Instead of signing a contract with a chauffeur company or a hailing app, they chose to provide access to Karhoo’s real-time global digital taxi marketplace. As such, they set new service standards that will create relevance and customer engagement.
Earn my love
In the digital age when changing a service provider is as easy as changing an app, loyalty clubs will have to work much harder to attract and keep consumers. They will have to think outside the box on how to integrate relevant services which create user experience synergies. They will have to find technological solutions which can communicate with each other effectively. They will bear the burden of proof that they choose the most cost-effective partners for their members. The arrival of MaaS and the endless potential which it brings these clubs to expand their offering just made their job much more interesting.
Chris Treadwell is vice president of Karhoo, a transport technology platform