👉 Background: Regional Express aka Rex, has always steered clear of Qantas, Virgin, and the late Tiger Airways because it specialised in regional flights.

👉 What happened: But in early 2020, Rex announced it would start flying the capital city routes (Think: Melbourne to Sydney, Sydney to Brisbane) and compete head on with Qantas. Now, Rex is going one step further by rolling out a loyalty program and new airport lounges to really compete with the big birdies of the sky.

👉 What else: This is a big move for Rex because loyalty programs are said to be one of the most vital parts of a successful airline.

What's the key learning?

💡Loyalty programs are the secret engine room behind the long-term success of airlines.

💡 Not only do these programs make their customers stickier (hello points trips to LA), but they also help the airlines diversify their revenue streams. Think partnerships with hotels, car rentals, and even credit cards. Many of these partners pre-pay for points to on-sell to their customers.

💡In fact, an airline's loyalty program is often worth more than the airline itself.

• During COVID, American Airlines used its loyalty program as the collateralagainst $10 billion of debt (rather than the airline).
  
• Qantas Loyalty has generated more than $1.3 billion in profits since COVID.
• Prior to going into administration, Virgin Australia's Velocity business was valued at $2 billion.

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