Duty Free Cash
A new rewards solution for travel retail
A programme to translate loyalty points into airport duty free spend has been created by former Nice Airport Chief Commercial Officer Filip Soete and digital rewards solutions provider Reward the World. We speak with the partners about the concept and their goals. By Dermot Davitt.
Loyalty points, whether in the world of hotels, air travel or shopping, remain an under-used asset for brands and consumers. According to Colloquy Loyalty Census 2017, US$360 billion worth of loyalty points worldwide across all channels remained unredeemed – a number which has since increased by an estimated +30%.
This represents not just a missed opportunity for consumers but also highlights the potential for businesses to engage with their customer base.
It is against this backdrop that digital rewards solutions provider Reward the World, led by Denis Huré, and Filip Soete – well known as the former Chief Commercial Officer at Nice Côte d’Azur Airport – have introduced Duty-Free Cash, a service that allows members to redeem accumulated points at duty free stores.
He says: “With this innovative new service, we’re bridging the gap between loyalty programmes and real-world utility. Now, every time you travel, your loyalty points will pave the way for a more enriched retail experience.”
“At a time when airport retailers are seeking innovative solutions to drive foot traffic and revenue, this initiative presents a fresh approach,” says Huré. “It’s a win-win – while consumers get more bang for their buck, retailers get an engaged and motivated audience.”
The service was unveiled by the partners at TFWA World Exhibition in Cannes. It will be available at selected international airports from early December.
Reward the World collaborates with a network of duty free stores – from international hubs to regional airports – to ensure travellers can redeem loyalty points globally, many of them from hotels.
Filip Soete (left) and Denis Huré at the launch of Duty-Free Cash in Cannes
The concept began to come to life several years ago amid conversations with hoteliers, who said they struggled to ensure that customers could use their points benefits, and was especially an issue for hotel groups with smaller portfolios.
“The idea is very simple,” says Soete. “We are in the world of travel. Many people travelling to a hotel are at some point also travelling through an airport. We have an issue attracting people into the duty free shops – if the figure is just 25% it means that 75% don’t engage with duty free.
“So how can we create a user-friendly pathway allowing people to burn those points in duty free? It attracts people into the shops, but it also means you are likely to spend more than the credit amount you are given, and it can build basket sizes.”
Behind the idea is a complex system developed by Reward the World. Huré explains: “The platform was created in 2009, initially specialising in digital entertainment from books to videos to music. It expanded later to be a one-stop-shop for rewards. People can both earn and burn points.
“Loyalty is a major platform, through which we work with hotels, banks and other institutions. We don’t yet work with airlines but that is a matter of time.
“The user journey is simple. You have a Duty Free Cash option on what you spend, €5, €10, €25 and €50 in Euros, Pounds or Dollars. The idea is not necessarily that you pay in full but that you use the full credit and then over-spend on your purchases, allowing for up-sell. When people choose the amount, a QR code is generated using our voucher code technology. Then you present the QR code in the store that can be read by the retailer, then de-activated, which is important for security. We take a commission on the voucher amount spent.”
Soete adds: “You can add the code in your digital wallet, which is like having cash in your pocket. It can sit beside your boarding pass.”
Filip Soete outlines the benefits of the simple, easy to understand points burning scheme
“There is a myth that loyalty programmes don’t want you to redeem their points. It’s just not true.”
Each retailer can decide how specific they want the code to be, by airport or all airports in a country where they operate. The project begins with duty free shops only, but it could expand to all commercial outlets at an airport. For the early phase, Duty Free Cash says it has agreements with two of the top five global travel retailers and is confident of gaining more partners in the coming months.
Duty-Free Cash is not just an enhancement for loyalty programme members, but also a new redemption option for duty free retailers, they add.
The service’s technology integration allows instant conversion of points to local currency value, making transactions hassle-free. Duty-Free Cash will also enhance the shopping experience by offering users exclusive deals and offers.
Huré says: “There is a myth that loyalty programmes don’t want you to redeem their points. It’s just not true. If you are a hotel group you want to find ways to help users burn points.
“People can have many points from many schemes but they are not loyal until they start spending those points. The hotel in turn can seize on that spend and offer you further incentives or discounts on your next stay – it all helps generate and build loyalty within this travel world. What we have to do is to make it easy.”
In communicating the benefits, partners can use marketing materials from Reward the World, whether they are a hotel or a duty free shop. This also helps to connect travellers to the service. Gift cards are another option for travellers as the service expands.
The potential to grow remains vast, says Huré. “Loyalty does not only extend to airlines or hotels today, but to FMCG companies and more than ever, to employee recognitions schemes. These can all become part of this network. The more you allow people to burn these points, and the more they are used, the more loyalty is created. But I should say also that we are not a loyalty solution, we are a rewards solution – and we don’t overlap with retailers’ own loyalty programmes.”
By mid-2024, Duty-Free Cash users will be able to redeem points at duty free stores in over 100 international airports, say the owners.
“For any programme to work, it has to be simple and relevant for users,” says Soete. “That’s our first target. Everything is about convenience and speed in the digital age. Everything is about mobile. We aim to extend the service to the whole world of travel retail as quickly as possible. The retailers understand that a global solution is necessary. That is what we offer.”
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