Optimizing Airline Loyalty Programs for Firm Profitability
This study examines how airlines can effectively leverage frequent flyer programs (FFPs) to reduce costs and optimize benefits for both customers and organizations in the era of Marketing 4.0. Given the highly competitive nature of the airline industry, carriers continuously enhance their products and services to achieve organizational success. Customer loyalty programs, particularly FFPs, have emerged as strategic tools for customer retention and revenue maximization. In recent years, FFPs have increasingly operated as independent profit-generating units within airlines. This study employs a qualitative systematic review, utilizing thematic analysis to synthesize empirical and conceptual research from peer-reviewed journals. The conclusion aligns with existing literature on airline marketing, revenue management, and loyalty programs, demonstrating how airline’s structure FFPs as independent business units to enhance profitability. Furthermore, the study highlights the role of airline alliances in integrating loyalty programs as strategic assets to optimize organizational revenue. The implications of this research contribute to the body of knowledge on airline loyalty programs, offering insights for industry practitioners and academics. The findings suggest that airlines can maximize profitability by refining, expanding, and innovating their FFPs to enhance customer retention and ensure long-term business sustainability. Practical recommendations for both industry professionals and researchers are also provided.
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