Contrary to popular belief, Tong Guo found consumers usually make rational decisions when booking air travel
Fuqua assistant professor of marketing Tong Guo considers herself a savvy traveler, someone who before purchasing an airline ticket will weigh the benefits of low fares versus upgrades she might receive as a frequent flyer.
Her curiosity in all manners of travel dates back to graduate school, when as a Ph.D. student in quantitative marketing she began researching how to help businesses make wise decisions, and the consequences of those decisions on consumers.
So when she and two other scholars received permission from a leading U.S.-based airline to study its vast frequent-flyer program database, it was the research equivalent of hitting the Lotto. “I was so excited about this unique opportunity,†Guo said. “We ended up focusing on frequent flyer programs in this paper, an important marketing strategy pioneered by airline industry and adopted by many more businesses in almost every domain.â€
Their study, published in the current issue of the journal Marketing Science, examined the histories and point accumulations of 3.5 million frequent-flyer program members to determine how influential is the loyalty program in incentivizing people to fly more with the company, even though they may have cheaper alternatives.
[This article has been reproduced with permission from Duke University's Fuqua School of Business. This piece originally appeared on Duke Fuqua Insights]