However, companies in travel, hospitality, and payments are now creating loyalty that revolves around a broader concept of value, extending beyond just points and cashback to include personalized experiences, flexibility, and access.
Experts suggest that today’s travellers assess reward ecosystems in a more comprehensive way.
“Loyalty is no longer just about accumulating points, but about how relevant and adaptable those rewards are in enriching the overall experience,” stated Karthik Venkataraman, Chief Product and Revenue Officer at VeTravel – Vernost, a complete, holistic B2B travel technology platform.
He noted that while travellers still value savings and rewards, they expect these to be linked with convenience and personalized travel experiences.
This transformation is noticeable throughout the hospitality sector.
Hotels and travel firms are now concentrating on tailored stays, local attractions, wellness options, and seamless services to boost customer engagement.
“Today’s discerning traveller is no longer driven solely by points accumulation or transactional rewards; they are in search of connection, significance, and memories that last beyond their visit,” observed Vikram Puri, Managing Director at Archer Hospitality, a hospitality company in India.
Puri indicated that hospitality brands are seeking to build loyalty through personalized and experience-driven offerings rather than merely relying on traditional reward methods.
He emphasized that guests in the premium segment wish for the price they pay to “unlock something unique, not just something redeemable.”
Puneet Sethi, Managing Director at Kaara Hotels, a hotel management company, remarked that the sector is steadily transitioning from “transactional loyalty to relational loyalty,” where emotional connections are becoming more significant for encouraging repeat engagement than discounts or points alone.
“Unlike points, which can be easily compared across brands, experiences are challenging to duplicate,” Sethi explained. “They rely on how guests felt during their stay, and that emotional memory becomes the key factor for repeat engagement.”
Premium cards are offering access
In recent years, travel-oriented credit cards have undergone considerable evolution. Previously, rewards programs mainly competed based on points and redemption rates.
Now, banks are branding premium cards around lifestyle and travel contexts.
Benefits like airport lounge access, concierge services, hotel memberships, premium dining privileges, travel insurance, airport transfers, and curated experiences are now crucial differentiators.
“Consumers want a card that enhances the experience rather than just one that optimizes points,” explained Dhruv Verma, CEO of Thriwe, a global technology-driven B2B consumer benefits and loyalty program provider.
Verma noted that many individuals are assessing premium cards less on reward statistics and more on how effectively they improve the travel experience itself.
Travel platforms are witnessing similar trends.
“While rewards and loyalty programs are still valuable, they no longer singularly drive travel decisions,” said Bernard Corraya, General Manager at Wego, a global travel meta-search engine and online marketplace.
Satheesh Satchit, Co-Founder and Chief Product Officer at Verteil Technologies, a travel tech firm, added that travellers are looking for more than just the lowest fare.
“Many are willing to invest a bit more if it means better flight times, added comfort, flexibility, or simply a smoother journey,” he noted.
Why card issuers are quietly reducing rewards
While premium travel perks become increasingly appealing, the financial viability behind them is becoming more challenging for issuers.
Credit card companies have adjusted travel programs by cutting specific benefits, raising eligibility criteria, and altering redemption processes as costs escalate.
Several issuers have implemented higher annual spending thresholds to access accelerated rewards, hotel memberships, or complimentary travel benefits.
Transfer partnerships have also seen modifications.
For instance, Axis Bank has removed certain hotel and airline transfer partners from various premium offerings, affecting those linked to hotel and airline loyalty programs. Reward structures across issuers have also undergone changes regarding milestone spending benefits and redemption values.
These modifications highlight a broader issue within loyalty programs: premium experiences like airport lounges, hotel collaborations, and travel benefits are significantly more expensive to maintain than traditional rewards frameworks.
As usage increases, banks face the challenge of balancing customer acquisition, benefit costs, and profitability.
What should cardholders consider?
For consumers, the shifting landscape presents a crucial question: how should travel cards be evaluated given that perks and reward structures can vary?
Experts advise focusing less on advertised benefits and more on actual usage.
Instead of chasing every premium card or heavily relying on a single rewards system, consumers might benefit from spreading their expenses across a few cards that match their spending habits.
Cards co-branded with travel or hospitality brands may also grow more relevant for those who frequently use specific hotel chains or airline networks.
Simultaneously, experts caution against allowing rewards structures to dictate spending behavior.
“The experience economy hasn’t altered the mathematics of personal finance,” Verma pointed out. “It has merely changed what people are inclined to prioritize.”
Satchit shared a similar view, emphasizing that experience-driven spending functions best when it is planned rather than impulsive.
