Airline Loyalty Today: OAG Traveler Survey 2024

DALLAS — The OAG Traveler Survey 2024 offers an in-depth look into the evolving preferences and behaviors of North American travelers. The survey, which gathered responses from over 2,000 participants, reveals significant trends that are reshaping the travel industry.

To start, a substantial 64% of respondents reported taking three or more trips annually, indicating a strong demand for travel, specially for business, with Millenials traveling the most at 36% (up by 6% last year) and Boomers the least at 18% (down by 1% from last year).

Also, most travelers get their tickets on the web, and all of them want free checked bags—no surprise there. Let's dive deep into the key findings.

1. Generational Differences

• ‍Gen Z and Millennial: These younger travelers display a noticeable decline in engagement with traditional airline loyalty programs. Instead, they show a preference for flexibility and personalized experiences.‍
• Older Generation: In contrast, older travelers remain more loyal to conventional rewards programs, valuing accumulated points and miles.

Here are three additional takeaways from the survey:

• "All generations except Baby Boomers are traveling more for business this year. Millennials still travel the most for business, with 36% percent doing so (up by 6% last year). Thirty-five percent of Gen X are traveling for business (up by 10%), and 27% of Gen Z (up by 1%). Only 18% of Baby Boomers are traveling for business this year (down by 1% from last year)."‍
• "Baby Boomers travel the most for leisure. Eighty-two percent of Baby Boomers listed vacation as the main reason for their travels this year (up by 6% from last year)."‍
• "The generation that’s catching up on leisure activity? Seventy-three percent of Gen Z are traveling for leisure this year, a whopping 16% more than those who did last year."

2. Preferences for Loyalty Points

• ‍Vacation Rentals: Many travelers prefer to redeem their loyalty points for vacation rentals rather than flights or hotel stays, highlighting a shift towards alternative accommodation options.‍
• Ancillary Services: Free checked bags and other ancillary services are highly desired, suggesting that practical benefits can drive loyalty more effectively than abstract rewards.

Most travelers  desire to "put their airline rewards program points towards hotel accommodations (73%), followed by car rental services (53%). Additionally, 50% of Gen Z and 49% of Millennials want the ability to use points with vacation rental providers."

Regarding airline credit cards, "the majority of travelers want free checked baggage (63%) and sign-up bonuses (56%), with 43% wanting access to airport lounges."

3. Cost and Experience Over Loyalty

As per the survey, Gen Z and Millennials (27%) are more inclined to spend up to $100 extra to fly with legacy carriers, whereas 25% of Gen X and 39% of Baby Boomers are unwilling to pay more for larger carriers.

This goes against the idea that low-cost carriers attract younger, price-sensitive travelers—perhaps this is why some LCCs have decided to not to have change fees or charge ancillaries, thus signaling that their business model does not work.

Instead, younger generations prioritize the travel experience, viewing flights as a means to reach their destinations. This preference aligns with their tendency to redeem airline points for travel-specific experiences like vacation rentals and hotels.

• Travelers are increasingly prioritizing the overall cost and quality of their travel experience over loyalty rewards. This trend is particularly strong among younger travelers, who are willing to pay extra for superior services and experiences.
• The desire for a seamless and enjoyable travel experience is leading many to choose airlines and services that offer better value and comfort, even if it means forgoing traditional loyalty benefits.

4. Airline Innovation

• To maintain and grow traveler loyalty, airlines must innovate by offering more flexible and appealing loyalty programs. This includes integrating options that cater to the preferences of younger travelers and enhancing the overall travel experience through improved services and amenities.

The survey underscores the need for airlines to adapt to the changing landscape of traveler expectations. "As Gen Z and Millennial preferences redefine what loyalty programs look like, airlines will need to rethink what matters most to travelers to engage customers more deeply."

What's the main takeaway from the survey? By focusing on flexibility, personalized experiences, and practical benefits, airlines can better meet the needs of today's diverse traveler demographic.

For a comprehensive understanding of these insights, refer to the full report on the OAG Traveler Survey 2024.