Amanda Cromhout 9 min

Blind Loyalty Challenge with Andrew Swaffield


Learn what Andrew sees as the toughest part about launching a coalition program, whether coalition or frequent flyer programs are more profitable, and why non-transactional benefits can have the greatest impact.



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Hi there, I'm Amanda Cromhoe from Truth. Welcome to the Blind Loyalty Challenge

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. We interview

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world experts in loyalty blindly. We're hoping to create insight, spontaneity

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and a lot of

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fun through the challenge. The challenge is about promoting the Blind Loyalty

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Trust and

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my book called Blind Loyalty, a 101 loyalty concept radically simplified. All

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profits from

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the book go towards the trust. We hope you enjoy the Blind Loyalty Challenge.

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Hello everybody, welcome back to the Blind Loyalty Challenge and today I chat

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to Andrew

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Swaffield. Now Andrew I don't think needs any introduction to the greater world

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of loyalty

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but I'm going to give a short introduction. But before I do, Andrew's parent

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positioning

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is very much around executive coaching and leadership development. But I know

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Andrew

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actually prefer to call Andrew Swaff and we've known each other for many years.

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We worked

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together in British Airways which was a real highlight of my career and then

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Andrew went

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on to head up Avios and Virgin Red and other roles within the Virgin Enterprise

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. So there's

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no shortage of loyalty nuggets that are inside Swaff on the other side of the

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screen. So Andrew,

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welcome to the Blind Loyalty Challenge. Thanks Amanda, great to be here.

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Yes, you were tagged by Matt Alden who's a mutual friend and also well known in

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the industry

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so you can blame him. So here we go. So first question, chapter 22 of Blind L

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oyalty is around

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coalition. So this is obviously super easy for you because you've headed up to

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Goganchun

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coalition programs, global programs. But what would you say was the hardest

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thing

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to get a program like Virgin Red off the ground? Without a doubt, the hardest

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thing is getting

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cooperation from different organisations and particularly organisations that

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are being asked

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to do something for the first time or in loyalty or indeed change something

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that they've been doing

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for many years. So I always without hesitation say actually getting

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organisations, CEOs, boards

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and C-suites to take on board, new loyalty solutions is definitely the hardest

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part of this work.

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Yeah, definitely. That change management process is like top down, doesn't

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certainly doesn't go

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bottom up. So yeah, I hear you. Okay, great. So I'm keeping on the theme of

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coalition but obviously

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you've got decades of airline experience in you. So what would you say is more

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profitable coalition

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or FFP? Well, FFP is definitely more profitable in a purely financial sense. I

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'm in the margins

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that generated by the combination of those distressed seats on the aircraft

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that the airline can get

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access to and the abundance of financial services partners really. So those two

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ingredients create

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the profitability of frequent flyer programs and you only have to look at some

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of the big monsters

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like the US programs where they've got say 100 million members and in many

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cases

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bringing in 10 or 15 billion dollars a year in credit card revenue into their F

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FP.

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So that's the reason why there's so much profit in FFP. However, I think that

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the coalition aspect

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creates sustainability for FFPs. So if you simply milk the cow of credit card

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and airline

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for decades, eventually it's going to stop yielding and creating coalition

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partners

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gives customers a way of integrating it into their lives and makes the thing

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much more sustainable.

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But it's much lower margin work and therefore it's tempting not to do that if

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you're in an airline.

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Yeah, absolutely. Great, great way of explaining it. So anyone out there who's

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struggling in FFP

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and just wanting to get that longer term reach and stickiness, don't be afraid

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of a coalition

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relationship. Yeah, fabulous. So the last question is super easy but it's more

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personal. So what

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would you say has been your favourite ever loyalty experience? From a business

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point of view in terms

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of what I've done or as a customer? As a customer. Oh goodness. I was really

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worrying what you were

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going to ask me something like that and I was thinking, you know, I've got to

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try and plan

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this in advance. So I'm not a loyalty junkie myself, which is I suppose a bit

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heretical,

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you know, to say that having built two loyalty programs. I can't go into them

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programs. Yeah,

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but what I love is when I'm surprised by the fact that somebody recognises me

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and makes my life

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just a little bit easier. You know, I just love that. It's like the

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organisation has actually

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thought to itself, this customer is going to be moving across these, you know,

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these pillars of

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our corporate organisation. And I'm just going to make it a tiny bit easier for

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them. So, you know,

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you deal with an organisation that makes that so slick that you don't even

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notice it.

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Yeah, exactly. You know, I just love that. And I know what goes on in the

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background to make it

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happen. So, you know, when you, for example, with Amazon, you know, if I go on

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to my television and

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I switch on Amazon Prime and it knows who I am and it's ready with my password,

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you know, it's like

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they thought about this, they've really thought about it. And it just makes

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life a little bit

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easier. And I guess in many ways, that's what I've been trying to do, you know,

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by joining up

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British Airways and Iberia and Behlingus and so on, joining up Virgin companies

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, you know,

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trying to make it easier for customers. When it happens to me, I think, oh, you

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know, somebody's

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making my life just a little bit easier. And of course, if it's rewarding as

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well, and you get

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something, then, you know, that feels, you know, that feels extra special. But

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I love that, that

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sort of frictionless move within a big organisation. I think it's super, you

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know, rewarding. It

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makes you feel as if they've actually recognised you. I love what you say from

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a couple of reasons,

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but particularly because it might seem so utterly tiny on the surface. And yeah

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, it gives you such a

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sense of satisfaction or ease and trust in the brand and so on. But actually,

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what I love more

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about what you said is you know how hard it is behind the scenes to deliver

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that tiny little nugget

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of simplicity. It's utterly very difficult. And every loyalty brand around the

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world is struggling

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with it. And yet those who can get it right are probably making a bigger impact

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than burying their

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time in double points campaigns and percentage increases and so on. So I love

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that.

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You can do the hard work in the background. So the customer doesn't have to do

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it. And, you know,

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it's often thankless work as well. You get very little, you know, reward for it

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as an employee.

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But if you can track the effect that it's having on your customers, it's much

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bigger, I think,

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than people realise. Brilliant. Love that. Thank you. Thank you. Okay. So the

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one you were

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worrying about, you came through for that in colours. There are three questions

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. Who would you like

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me to interview next on the blind order challenge? Well, I think it's

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appropriate that my successor

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at Virgin Red, who you and I both know from Avios as well, should pick up the

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button. And that is

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Andrea Burchett, who's now the CEO of Virgin Red. Stunning. Well, yeah, I do

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know Andrea said,

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obviously love to chat to Andrea. So thank you for the tag and I'll chat to

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Andrea. Thanks,

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Andrea. Thank you, Swoff. More familiar terminology between us. But thank you

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for doing the blind

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order challenge. Thanks for having me. It's lovely to see you, Amanda. Thank

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you. Always. Thank you.

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