Air India to tie up with hotel chain, Amex to boost loyalty

Last Updated: Fri, Jun 14, 2013 03:57 hrs
The Air India's Dreamliner Boeing 787 is given a traditional water cannon salute by the fire tenders upon its arrival at the airport in New Delhi

In a bid to increase revenue, Air India has proposed tying up with an international hotel chain and a bank to boost its frequent-flyer programme.

"We will partner with an international hotel chain and launch a co-branded credit card with a bank with a nation-wide presence. These features have been missing from our programme,'' said Air India's commercial director, Deepak Brara.

Currently, the airline has a co-branded credit card with American Express Bank, but its card membership is low.

Globally, airlines enter into partnership with other companies offering "earn and burn'' incentives in the form of free miles and discounts in purchase and hotel stays, but the national carrier's scheme has lacked these features.

The airline is also looking at different ways of communication and launched a Facebook page last month to connect with its young flyers. It will come out with television commercial soon. Air India earns about Rs 10 crore annually from the frequent-flyer programme - also called loyalty programme -but has not been aggressive in promotions and partnerships with other companies. Australia's Qantas Airlines, which earns $56.21 as ancillary revenue per passenger (the highest per passenger revenue), relies heavily on the sale of frequent-flyer miles or points to its partners to increase revenue.

"We are launching a campaign regarding our frequent-flyer programme. Currently, it has 1.1 million members and 500 members are being added each day. In fact, the membership has grown from 750,000 last year to over a million members now,'' said Brara.

Also on the cards is upgrade of Air India holidays, which will allow travellers to make tour bookings directly on the airline website. Currently, it is a business-to-business platform and only travel agents can sell the tour packages.

Air India has tied up with a portal for the scheme and earns a per passenger royalty from the portal. Air India estimates its total revenue would go up 20 per cent by the end of the current financial year.The carrier's total revenue is expected to rise from Rs 16,130 crore in 2012-13 to Rs 19,393 crore in 2013-14.

The airline has six Boeing 787s at present and it has ordered another 27. The Boeing 787s operate on domestic routes between Delhi-Chennai and Bangalore-Kolkata routes, besides international operations to London, Frankfurt and Paris. Boeing has indicated that the eight aircraft will be delivered till December 2013.

Air India plans to launch flights to Sydney-Melbourne and Birmingham by August-end with Boeing 787s.

  • Air India launching campaign to popularise its frequent-flyer programme
  • Upgrading Air India holidays to allow travellers to make bookings directly from its website
  • Planning to launch flights to Sydney-Melbourne and Birgmingham by August-end with Boeing 787s

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