Asia Miles was established as a loyalty program under Cathay Pacific 20 years ago. Though it is still owned by Cathay, Asia Miles now partners with a great number of airlines as well as through an ecosystem of partners to add value to frequent travelers with different ideas of what a great loyalty program should yield.
Michael Yung is the Head of Digital Product and Technology at Asia Miles, and over the past five years, he has helped grow the company, and to help it continue its evolution to become a digital leader in the loyalty space. He explains the evolution of the company from largely a call center-based business to one that services customers across a wide array of digital formats. He describes the different types of customers Asia Miles serves. Yung also talks about the diverse team he has built. Lastly, he details his team’s creative use of blockchain for marketing campaigns using smart contracts. I caught up with Yung recently at Adobe Summit in Las Vegas, and covered all of these topics and more.
Michael Yung: Asia Miles is the loyalty rewards program of the Hong Kong-based airline Cathay Pacific Airways. Similar to any loyalty rewards program, our members can earn miles by flying, traveling, shopping, dining, or even by having a mortgage with our banking partners. Our members can redeem points for many rewards such as hotel stays or laptops. We set up our program in 1999, so we are celebrating our 20th anniversary this year. Over the 20 years, we have accumulated over 11 million members, we have about 700 partners around the world to serve those members, and we are the leading loyalty program in Asia.
High: Could you talk about your role as the Head of Digital Product and Technology?
Yung: Similar to other loyalty programs, we have no physical branches. Everything we do is digital, so we get in touch with our members and partners through digital media. My role is to grow out all these digital products, such as the web, the app, and the engine behind it all to let our members earn miles or redeem products. Behind the scenes, we have the membership databases, CRM, and the digital marketing platform because we are essentially a digital marketing company. We are looking at how to match the offers, products, and services from our partners to members around the world.
High: Can you talk about your ecosystem of partners? How do you relate to them, develop them, and continue to work with them?
Yung: Roughly 20 years ago, we set up something similar to a frequent flyer program in which we worked exclusively with airlines. Gradually, we moved from this to a travel rewards program, which included hotel partners. These days, we are similar to a lifestyle rewards program, so members can do anything with their credit card and cash to earn miles. That is how we have developed our network.
Making this happen requires a partnership team that works closely with our partners to make sure we serve them well and that we channel our targeted members to our partners so they can grow their businesses. At the same time, we have to provide the right offers, products, and services to our members such that they believe it is cool to be an Asia Miles member. The miles our members earn can be redeemed for something that is immensely valuable to them.
High: Over the past 20 years, the digital experience has evolved tremendously. Could you talk about that evolution?
Yung: 20 years ago, the primary approach to reaching our members was through a newsletter and a call center. With the call center, members would punch in their membership ID and password and talk to an agent. Over time, we have incorporated the website, email, and now [service through] mobile devices that allow us to provide more personalized experiences to our members. For example, with our mobile app, members can ask, “What restaurant is around me?” On a slow day, such as a Wednesday, we might be inclined to offer double miles to the members who spend money with our restaurant partners.
We have looked to develop some technical solutions such as blockchain, and we embed our marketing campaigns in blockchain-based smart contracts. Typically, members have to wait several months to earn their bonus miles, but with the smart contract, they can earn the bonus hours in real time. This is because our team typically takes time to make the calculation, the data retrieval, and the reconciliation before awarding bonus hours. However, that all goes away with the smart contract. Once we know that a member just spent $1,000 in a restaurant and reached level one, they get the bonus miles then and there. Of course, all of these channels run on top of the digital marketing platform.
High: Do you find that there are different needs or preferences between different generations?
Yung: Many of the members who have 10 to 15 years of membership history with us still prefer the call center. For these hybrid members, they likely arrange their itinerary with their assistants instead of by themselves directly. However, the latest generation wants self-services, chatbots, and mobile devices, so we have to implement our digital products accordingly. While we have different ways to serve our members, we have to find better ways to sell our offers, products, and services to the right members. Doing so depends on the persona, the miles balance, their lifetime value, and their stage in life. For example, if they are a student, they may want a mobile phone or headphones, instead of something else, while if they are a successful businessman, they might want a first-class ticket from Hong Kong to San Francisco. We have [identified] different personas, so we have to offer different benefits for each.
High: Could you provide a thumbnail sketch as to the technology and talent landscape in Hong Kong?
Yung: We have a digital product team, a digital marketing team, a customer services team, a customer journey design team, and a data warehouse and data analytics teams. If you want to run a successful loyalty program, you have to have a variety of talents and skill sets to make sure you have a good offer, good redemption, a good user experience, and a good targeting and marketing team. It is important to bring all this together and power it with big data, so you need data warehouse and data analytics teams. Whenever we have a new idea or a new project, we set up what we call the digital acceleration team. We pull people from the customer journey, user experience, digital marketing, and digital product teams together to see how we can provide a great product to our members and partners. In Hong Kong [alone], that is not easy, so we have colleagues from France, Egypt, Malaysia, Indonesia, Iceland, among other countries who work at Asia Miles. In total, we have roughly 15 nationalities. Most of them move to Hong Kong to work together, so they are co-located. The others work at what we call the Offshore Development Center in mainland China or India.
High: Could you talk about your relationship with Cathay Pacific?
Yung: We are 100% owned by Cathay Pacific, and while we have 26 airline partners, they are our biggest. Cathay Pacific also maintains a loyalty program called Marco Polo, which is more similar to a tier program that has a green, silver, gold, and diamond tier. We provide this to Marco Polo members such that they get the exceptional services throughout the entire flying journey. Once they finish flying, they get the miles, so we are focused on how we can reward those members. Because we have a different brand, Asia Miles can partner with any airline we want on top of Cathay Pacific and Cathay Dragon. This is an exciting business model and an interesting setup.
High: As you look to the future, what are some of the trends that are making their way onto your personal roadmap?
Yung: Self-service technologies like chatbots and robotic process automation [RPA] are extremely important to the future. These technologies improve back-office efficiency and allow us to link different legacy system together. Chatbot and live chat provide self-services to our younger generation members. Digital marketing is not only about posting a video on YouTube or on social media. Instead, it has to be driven by data, driven by proper segmentation, and it has to be pushed to the proper channel at the right time. We are investing a lot of resources on this.
We are also deeply interested in blockchain and smart contract technology. We believe that for our loyalty program, we can save time and effort in reconciliation, data integrity, and other important areas.
originally posted on Forbes.com by Peter High
