Miles better: the new business of airline loyalty

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This summer, ahead of England’s World Cup quarter-final against Norway, British Airways and Norwegian Air made a lighthearted bet: whichever nation’s football team lost, would swap its social media profile picture for the winner’s logo. When Norway was defeated, Norwegian Air graciously honoured the deal, wishing England and British Airways good luck in the semi-final. This funny exchange got me thinking about how airlines are investing time, creativity and personality into building relationships with customers that extend far beyond the flight itself.

In many ways, airlines are starting to borrow from the playbook that retailers have used for years: creating reasons for customers to engage with their brands even when they are not actively making a purchase. For example, in May, TUI launched Smiles Rewards Club, the company’s first global loyalty scheme. The app gives every member one spin of a wheel each month and guarantees a win, bonus points, or even an entry into a prize draw for a free holiday. Interestingly though, the customer doesn’t need to book a trip to access it; they simply need to be a member.

“The loyalty programme has become a significant business in its own right, rather than simply a reward for choosing the airline.”

Membership and loyalty programmes are not new concepts in the airline sector. British Airways has been building a loyalty business since 1991, when it launched what became known as the Executive Club, rebranded The British Airways Club in 2025. Its reward currency, Avios, now reaches well beyond flying: members can convert points to and from Sainsbury’s Nectar scheme, and the airline’s partnership with American Express, marking its 25th year in 2026, remains one of its most valuable assets. My husband is an expert Avios collector, and I am an expert Avios spender, and between us, we have turned redeeming points into something of a competitive family sport!

What is interesting to see is that now more than 80% of the loyalty programme’s revenue comes from external partners, among them Amex and JPMorgan Chase, buying Avios on customers’ behalf, rather than from flying itself. In other words, the loyalty programme has become a significant business in its own right, rather than simply a reward for choosing the airline.

This July, British Airways put the individual at the heart of its product in a way it had never been able to before. Face ID has replaced the need for a boarding pass on some journeys, and a passport can now be scanned rather than handed over. I asked Lisa Tremble, British Airways’ Chief Customer and People Officer, what the redesign was built to solve. “Customers told us they wanted easier access to the information that matters most to them, fewer steps to manage their journey, and greater confidence that they had everything they needed in one place,” she told me. Passengers, she added, “increasingly manage every aspect of their lives through their smartphones, and they expect the same from their travel experience.” That shift in consumer expectation is important. Customers increasingly compare airline digital experiences not with other airlines, but with the best apps they use every day.

Courtesy of British Airways.

Virgin Atlantic is seeing something similar. Laura Brander, Vice President of Communications at the airline, told me: “We are no longer defined solely by the journey itself. Loyalty, retail and digital experiences are becoming just as important in building long term relationships and giving customers more reasons to choose your brand.” Asked where the real opportunity sits, she answered: “The biggest opportunity is inspiring customers to come back.”

Lisa agreed with this point, especially when one of the biggest challenges for airlines is frequency of use, however, she told me she was wary of filling that gap just for the sake of it. “Our focus isn’t on driving engagement for engagement’s sake,” she said, “It’s on making the app genuinely useful whenever customers need it.” In practice, that means the app is now useful even when the customer has no trips planned as a place to manage a Club membership, browse destinations and check entry requirements. To make this as valuable as possible, everything’s becoming a bit more personal.

Personalisation is not a new idea, but it is where airlines are now spending real energy. Knowing that a customer flies for business, or always travels with family, or prefers a particular cabin, lets the airline surface the right product for them. Lisa explained: “The best personalisation saves time, reduces friction and helps customers find what they’re looking for more quickly.”

Courtesy of Virgin Atlantic.

For Virgin Atlantic, creating value with its customers has meant giving its most loyal flyers moments they could not otherwise buy. Members of its Wings community have flown the inaugural routes to Seoul and Toronto alongside founder Richard Branson, and been invited to the airline’s Customer Experience Showcase, where it unveils its latest plans and innovations to its most engaged customers before anyone else sees them. “A sense of fun is in our DNA,” Laura explained, “and this extends to loyalty, but it has to reflect what matters most to our customers and the reasons they travel.”

Not every airline is building this kind of retail relationship through a formal points currency. Take Jet2’s myJet2Perks programme, for example. It offers members discounts from partner brands and weekly prize draws regardless of whether a holiday is booked, which leads to more consistent engagement. Riyadh Air has taken the same principle further still, building its Sfeer scheme into the airline from day one, with points that never expire and that can be shared between friends and family.

“What has changed is how closely airlines are now applying that retail thinking to a product that used to be sold once and then, generally, not engaged with between trips.”

There is a reason airline loyalty is adapting so quickly for younger customers. Research by the aviation data company OAG found that only 65% of Gen Z travellers are enrolled in an airline loyalty scheme, against 89% of Baby Boomers. It would be easy to read that gap as disinterest, but research published by Phocuswright this year found the opposite: Gen Z travellers redeem loyalty rewards at higher rates than older generations, they are simply less willing to stay loyal to one airline to do it, booking across several depending on price, route or experience. Jet2’s discounts and TUI’s monthly spin are built for exactly that customer.

Courtesy of Virgin Atlantic.

None of these mechanics are new to shoppers. A guaranteed monthly spin borrows directly from the gamified loyalty apps beauty brands such as Sephora have used for years, and a two-way points conversion between an airline and a supermarket, of the kind British Airways already runs with Nectar, is not so different to the coalition loyalty schemes UK retail has run for decades. What has changed is how closely airlines are now applying that retail thinking to a product that used to be sold once and then, generally, not engaged with between trips.

As younger generations continue to book across multiple airlines rather than stay loyal to one, we’re likely to see these loyalty methods keep evolving. The airlines that succeed may be those that find the most effective ways to stay connected with customers between trips, rather than simply serving them when it’s time to travel. With technology changing so quickly and the world more connected than ever, it will be worth watching to see what happens next.

[email protected] | The MBS Group

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