Rick Denton: 0:05

You're listening to CX Passport, the show about creating great customer experiences with a dash of travel talk. Each episode we’ll talk with our guests about great CX, travel...and just like the best journeys, explore new directions we never anticipated. I'm your host Rick Denton. I believe the best meals are served outside and require a passport. Let's get going. With the summer we've had, I wonder what sort of loyalty might be left for an industry where today's guest focuses. Mark Ross-Smith, an award winning global airline loyalty industry leader sits with CX passport today to talk about just that loyalty and the airline industry. That's right, the much maligned but so vital. And so loyalty focused industry, Mark is doing his part to make a better experience for that world. Mark brings a depth of experience from the airline industry previously heading up the Malaysia Airlines and rich loyalty program. Currently, Mark is CEO and founder at Status Match, which simplifies a key element of customer loyalty for the airlines. It's always fun for me to talk with someone on the other side of the globe, expanding my perspective on customer experience beyond what I find here in the US. And with a depth of airline exposure, I'll make sure to get mark to share his travel stories as well. Mark, welcome to CX passport.

Mark Ross-Smith: 1:26

Thank you, Rick, for the generous introduction. It's my pleasure to be here with you.

Rick Denton: 1:30

It's gonna be fun today. You know, customer experience I talked about it has this wide definition. Sometimes I say it's kind of like when someone says, Oh, so you're a designer? Or what does that mean? Graphic design, industrial design, all that. And so I love having guests from all flavors of the customer experience world, I'll get to help me with customer service, a taste of UX aside a Marketing. Today, it's loyalty. So let's start by talking about how you see customer experience and loyalty overlapping.

Mark Ross-Smith: 1:57

I think you're right in that within the customer experience ecosystem, there is a loyalty and a marketing component. And if you know if you're trying to visualize what this looks like, there's a Venn diagram somewhere that has like customer experience, marketing, loyalty, I think I sit somewhere in the center of that, where loyalty it's specifically airline loyalty, which is the field I play in has a pretty critical role in Qatar glowing, glowing these areas together and, you know, make a holistic, cohesive customer experience for passengers of the airline.

Rick Denton: 2:34

Yeah. And so when I'm thinking about that, just that loyalty aspect of it, I know, we're gonna get into some depth of loyalty, tying to customer experience and all of that. You have it? Have you seen it? Where it whether in your specific airline experience or just industry experience that those two worlds work well together? Are they working in opposition to each other? How are they even inside of a company really working together to make an overall experience something a customer would want.

Mark Ross-Smith: 3:01

So we're seeing a bit of a trend in airlines now where the loyalty product, there's a customer experience, dedicated customer experience, and in fairness, a lot of it's a seat, it's a sea level role now, like a Chief Customer Experience Officer, right, which is great for airlines, because, you know, airlines customer experience, had 100 years to get this right. And, generally, loyalty would report into one of some, you know, a few different key roles. And one of them we see a lot of airlines is reporting into a Chief Customer Experience Officer. And that kind of shows you the track within an airline that it is, you know, some airlines it reports into like a marketing role. But marketing roles have traditionally been, you know, TV and billboard and print magazine, that kind of stuff. Whereas loyalty programs, especially in the last few years have really come to the light because of the the value that they bring airlines and the cashflow they generate. And what what airlines have realizing is there's a link between really great brand experience, the customer experience that goes with that, and profitability out of customers. Funnily enough, when people are happy they spend more. Who would have guessed

Rick Denton: 4:14

that okay, so that sounds so simple, right? If we just hit the pocket, then we could go print up shirts and printed some coffee mugs, maybe put it on a throw pillow on our couch, right? But and we know it to be true. And yet we also know that there is such an opposite experience of that going on in some pockets of the airline experience. You and I both know that there are some airlines where it is an incredibly delightful experience. But you also know and we'll keep names out of it but airlines where it is just an almost near toxic experience. What is it? Do you think? Why aren't certain airlines buying into that or if they are buying into it not doing it for real just paying lip service to it?

Mark Ross-Smith: 4:54

I think if we take a step back and look at how airlines traditionally make decisions around customer experience And it there's a lot that's come from the perspective of people who work in an airline, right? And I think if you work in an airline, you get cheap flights. Yeah. Or they're free to when you fly. And then what happens is genuinely, most people working are not genuine customers of their own product, right? They're not, they're not they're spending 510 $20,000 to go fly around the world, just because they get free flights or cheap flights, like why would you spend that? Right? And so there's a bit of a disconnect in some airlines around that. Less so in low cost airlines, right? Because staff generally can afford the tickets. You know, when I work for a really big airline with really nice first class suites and stuff, not every staff member is there spending 20,000 bucks on a flight. And so, you know, when you, when you kind of have people that work in the company that are real customers of their own product, generally that customer experience goes up. If we look at another example like Starbucks, right? Everyone that works there as a customer, right, because it's pretty easy to store, you're in there for two minutes, you You're paranoid, that smell right, I haven't stopped, I smell the coffee. There's my addiction again, right. And it's, it's, it's easy, and everyone knows how it kind of works and how it should work. Whereas an airline is a little bit disjointed. Because the experience or the customer experience from the moment you book a flight is vastly different to how people that work in the airline that they experience they go through versus you and me and everyone else and the millions of other travelers, how we booked flights and how we check in just a really different experience. So I think, you know, if specially the airline if more staff there were users of their own product, I think we'd see a closer alignment of closing that gap, and an overall, better customer experience that sort of starts from the decision making process

Rick Denton: 6:50

that yeah, having flown a ton, you and I have talked about our shared extensive and our loyalty levels and that kind of stuff. I never, you know, I hadn't really thought of that before in the sense that what I'm going through is clearly different. I mean, I guess on the surface, of course, we know the gate agent is clearly experiencing something different than what I am as the passenger trying to board in an organized fashion. But that overall sense of operating an airline being different than being a customer of it. That principle holds true across so many aspects of customer experience, that idea of go out there and live, what's your customer lives. And I know at some point, like, okay, the CEO of big brand american airline in the Americas, right, You'd mentioned a term to me before, and it was completely they're still gonna get special treatment on the plane just new to me, I'd never heard this before Yugen. And I would love because people know who that person is. But somehow find a for you to share that concept with the listeners and explain way to go out there and taste that and see what that's like. how that concept of Yugen applies to travel.

Mark Ross-Smith: 7:55

So Yugen is a traditional Japanese aesthetics concept. And it's defined as the subtle and the profound. Fundamentally, it's the appreciation of beauty or artists from Japan, obviously, it's it talks about how it values the power to evoke an emotion rather than the ability to state it directly. So what that means is, it's a way to describe the emotional moment that we feel. And when we see something that is indescribably perfect. So, for example, it's the moment as you gaze out that horizon, and that moment when the sun just pops up over the horizon like that, that one second that it just, ah, there it is, you know, how do you describe that? Right? The word for it is it's a huge because it's invoking an emotional response within you about it. Right. It's the, you know, it's the valleys between the mountains, you know, you don't really notice the valleys, but the beauty of the mountains is only there because of the valleys. Yeah, yeah. It's the moment that a calligrapher puts puts the ink on the paper for the first time you see that first brushstroke, you know, it's just, it's just so perfect, because they have years and years of experience that you see, like, Wow,

Rick Denton: 9:12

nice. If I liked the beauty of that, I think we could just listen to that and enjoy just thinking about Yujin. But it is a travel so how, how does Yugen when you're introducing that concept apply to travel that that beautiful thought that you're describing?

Mark Ross-Smith: 9:27

So I think we've actually all experienced to some degree or Yugen my what I call it huge moment in travel. And it's, you know, it's what I call them small moments, right? So it's that moment when you're sitting in a seat, the flight attendant comes in and brings you a you know, a glass of wine, but the glass of wine is full to the brim. Right. It's not expected. And you kind of look at them as that moment where you look at their eyes. They look at you and is this acknowledgment of, you understand me? Thank you. That's the it's the For those of us lucky enough to have had an upgrade at the gate, you know, it's, you're at the gate, you scan your boarding pass, and that goes PPP PPP. And it's like, sorry, we've had to reassign your seat and they say, Here's your new seat. It's like, oh, sorry, we had to put you in one a 63, Ema and one eight. So I'm sorry. So it's that moment. And it's like, Ah, this is why I fly the this is why I fly that airline. This is why I'm so loyal to it like, because like, it's, that feeling is there for about three seconds. But it's stay it what happens is positive feelings repeated over and over and over, they get locked in your subconscious mind. And it's your subconscious mind that remembers things innately. So next time you go to book an airline ticket, huge for some reason, you go to your favorite airline and start booking a ticket, you don't know why it just, you're just loyal because you feel good about that brand. Because you've had all these positive experiences with these positive human moments.

Rick Denton: 10:55

Yeah, I am. I'm sitting here thinking, actually, as you're telling that, I'm immediately going through all of my Yugen experiences that I've had. And what's interesting is there's a couple that I'm talking about from the 90s. So it's that long ago. And if this podcast last into perpetuity, we're recording it in 2022. But back in the 90s 1990s, there was a particular US domestic airline that I have subsequently fired from my business now because their experience is so bad. But I still remember the smell of the warm cookie that would be provided on a longer flight coming if you happen to be up in first class, or a Sunday that they provided. I also remembered the delight of a particular carrier that I would choose to fly to Asia. And there was something about being able to walk up the stairs to the bubble, I called it at the top of the 747. That moment where it just felt who this is special. This is why I want to do that. And these are memories from decades ago, and yet they sit with me today. Now, I guess I did mention that you have to deliver consistent experiences and beyond the union or you get fired as an airline. And so maybe that's something I'd want to ask about, what about the anti union experiences. And so you mentioned boarding and the particular airline that is describing their boarding processes when the team group one, group two, group three, group four, which sounds like it'd be really organized, right, except that at the gate level, frequently, what happens is group 111 1002 1000, group 211 1002, and group three, and by the time you've gotten to about 15 seconds into the boarding process groups, one through six are crowded around a tiny space. And it is just utter chaos. So if Yugen is so vital to loyalty you describe it caused memories for me decades later, how do these anti Yugen experiences occur?

Mark Ross-Smith: 12:37

You mentioned some really interesting on the boarding process, they're funny enough to do what usually there is a Japanese airline, they have a first class or business class, you know, Premium Economy economy. And when they call for boring, it's always, you know, invite our first class diamond members the board and and what they deliberately it's not 1000 2000 3000 it's 1000 3000 34,035. They there's a good 32nd Wait there. Yeah, and I reserved this many times, obviously not picking first class, I'm sitting there waiting

Rick Denton: 13:11

for you. You're getting a lot of time to observe it as from the outside,

Mark Ross-Smith: 13:15

and I'm looking at it. But you know what? There's no one boarding. There's actually there's actually no one in first class on the flight, because I checked on the way is a giant advertisement for first class. That's that's how that was my interpretation. It's like, you know what? You could be in this line, but you're not. So next time think about it

Rick Denton: 13:35

Fascinating.

Your CX Passport Captain: 13:36

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Rick Denton: 14:02

What a great...you''re right. It is an absolute add. It's not only just a better boarding process, but it's marketing built in. I love it.

Mark Ross-Smith: 14:10

Yeah, so I think to point that, you know, the opposite of Yugen, there's probably a word for that one of your listeners are

Rick Denton: 14:16

good or not anti Yugen, but I'm sure there's something better.

Mark Ross-Smith: 14:20

I think you're right, because we know when you have a consistently negative experience, we'll call it not so positive, less than 50% You know, and that's over and over and over again you start to feel you know, why why am I why am I interacting with this brand and I think to your point when you know you fight that airline, that's what happened you had these small moments that were not so great over and over and over and over. And you know, sometimes airlines can can kind of get away with with this as well like they can they could neglect you to some degree they can get they could lose your bags, right? They could sure deliver you're an hour late to your destination they get these small moments. Right, and you still feel pretty good about the flight?

Rick Denton: 15:03

I hope you're right. And I know that I can certainly say that my experience with Southeast Asian carriers like you're describing, were much vastly different than what my experience with with my carriers here in the US. But that that idea of at least I hope that customers begin to vote with their wallets towards those positive experience, because I guess to some degree, the airlines are saying, look, I can treat you like crap. And you're still going to show up. And so there's, there's an element of that at least it feels that way in the US. But I know that I'm not the only one that has fired this particular airline, and it's chosen others. Because of that experience. I do hope that it will change. And I hope that there's, you know, I think something else that is exists right now, maybe it's particularly a US element that there's become this combativeness between passenger and airline that has actually manifested in real physical combativeness. But even just that attitude between the two that they are almost felt as enemies of each other. And I would love to see aspects of that both in the airport inside the plane, some of that coming together realization actually, we're all trying to achieve the same goal, which is to have a great flight that takes off and lands on time safely with a positive experience inside the cabin. I want to move out of that for a little bit here because I, when I'm talking to someone who has access, let's use that term has access to such a wide opportunity to travel, working for Malaysia Airlines being one example but just being in the region that you are. I was like to ask how did you leverage your flight benefits? How well was there a time that you stood there in the airport? You had your backpack on you had your passport you thought yeah, I'll head to Kenya this weekend.

Mark Ross-Smith: 16:48

I have not headed to Kenya for the weekend. I before in Malaysia, I lived in Hong Kong with my wife and my wife actually worked at a pretty big airline there. And you know, there's back in the day without kids, right? You could do this kind of stuff. You know, work times sort of jumped, you know, she'd come home from work and we'd go let's go let's go to Bangkok for the weekend. Nice. There was one time I'd remember actually I needed to go back to Australia for some family reason I think and you know, this is in the evening and I go to the airport I'd like to get you to get on this flight and you know as you're a standby pasture stuff right and there's there's no seats available. And we're all bummed out like oh I'm gonna do you know do I go via another city like yeah, you got your phone out thinking of that 300 options that you've got to get to a country right but this airline by this city this one by this one, this one and all these and as I was doing that I remember the the president services comes over and says actually, I can get you on the flight the captain said you can have the jump seat Do you want it Oh, and you know being an avid gay come like heck yeah, this is like an upgrade. Yeah, I was happy to come in like a coach seat back in the last row next to the bathroom. I was happy with that. But you know this I see this is like this is better than first class in my eyes

Rick Denton: 18:23

that's awesome. That is just simply awesome. So imagine when you're standing there at the board, and in the case of not getting upgraded to the jump seat which is fascinating and would be truly my best seat if someone would ever offer that to me which I know no longer can happen sadly. But when you've got all these destinations sometimes the travel can wear you out and it's nice to jump in the first class lounge so I'd love for you to join me here in the first class lounge let's move quickly here and have a little fun what is a dream travel location from your past?

Mark Ross-Smith: 18:55

Travel Hong Kong great buzz love that live there. I still love it. It's just the best place to go.

Rick Denton: 19:01

I love I love it just the blend of West and East the food is phenomenal. The beauty is off the charts what a great place I can see why that would be the dream travel from your past. What is a dream travel location you've not been to yet

Mark Ross-Smith: 19:16

Maldives I've still not been there on my bucket list.

Rick Denton: 19:20

I am amazed by its beauty as well and hopefully get there someday as well. Maybe a little easier for you than it is for me but hopefully you get there someday. What is we talked about food or I mentioned it of Hong Kong what's a favorite thing of yours to eat?

Mark Ross-Smith: 19:38

So burgers or mojitos that's how I grade how good a hotel is by burgeres and mojitos. Those are guys my heroes. Yeah, I got into the habit of doing this years ago and so you know, go to Nutella and I've been at if I mean as long as they serve these two things, you know, it's like I just get a burger Mojito. And that's how I'm going to write this entire experience.

Rick Denton: 19:57

Oh my gosh, I love the fruit. This class lounge because I always get something out of a guest that shocks me that love that burgers and mosquitoes. Maybe that'll be the title of the episode. But we'll see where this goes. What is the thing on the other side, your parents forced you to eat, but you hate it as a kid.

Mark Ross-Smith: 20:14

Broccoli, and I'm doing it to my kids right now they hate it. I'm making them do it. I'm having a lot of I'm trolling him. Now I'm having a lot of fun.

Rick Denton: 20:21

I think I think sometimes his parents and mine are much older get one in university, one almost in university. But his parents that trolling our kids is actually a key part of parenting that I did not realize until I became a parent, I look back on some of the things my parents did. And I'm thinking they were trolling me, weren't they. So I encourage you keep that broccoli trolling up, Mark, it'll be something they will be able to talk about in a podcast 40 years from now as well. What is one travel item not including your phone, you will not leave home without

Mark Ross-Smith: 20:50

Fun fact, I actually didn't have a phone for a long time. I smashed my phone about a year ago, and I've had to try and not have a phone for a while. I lost about six months with no phone. Wow. But put that aside, I think realistically, you know, you can't leave home without your American Express right.

Rick Denton: 21:12

Tell me about status match. Why did you create it? And how are you making that specific experience better?

Mark Ross-Smith: 21:20

bit of backstory. So what years ago, when I moved to Hong Kong, I asked the major local airline that for a status match, you know, I was at a top tier status with a competing airline. And so I said, you know, can you match my status? Can you give me the same thing with your airline? And I'll, I'll switch my business to you because, you know, I'm moving to Hong Kong. They said no, and I couldn't understand it. Because, you know, I spent all my money with this other airline? Like, why wouldn't you want my business? Right? This is status matching, as a concept is not new. It's been around since at least 1986. So airlines know what it is. And they, they, they said no, and I thought disastrous customer experience. So I asked another airline. And they said I'll give you like a silver status, which is at the at the time, I was like ultra Uber VIP status, right. So like having like a silver is like not really like for like, and I thought that was a bit of an insult, really. So I thought you know, I'm, I'm gonna start investigating this, I'm gonna start like, why am I saying no to this? I had a bit of time on my sleeve, obviously. Why am I doing this, and I thought, you know, I'm going to build a business around this one day, I'm going to FIS fix this customer experience this, what admite firsthand experience a poor customer experience. And there's got to be other people like me out there. And you know, fast forward, you know, seven, eight years, and there is there's people that change jobs and move cities, every all around the world every day 1000s and 1000s and 1000s of people. And if you're like an expat or a foreign country, generally you're making you know, some decent money. And when you move to new city, what do you do you get new bank account, you get new credit card, I got to fly new airline, because my old airline doesn't serve as the city or this country anymore, right? So I need to kind of move my life a little bit. So it's totally legitimate reasons why people would ask for these things. And the majority airlines are just not set up for this, they're not that great at doing a lot of things that are not generally not that great at onboarding new high value customers, they don't really know how to how to act or what to say. And so status match, we've effectively build a process around that to help to manage it on behalf of airlines. So instead of airlines, saying no to the customer, they can just say, Sure, go here, go to this website, go to our partner guide, you know, they'll look after you.

Rick Denton: 23:45

I like the one I liked the origin story, because I love anybody that's created a company based off of pain point that they experienced themselves. The, alright, this is broken, so I'm gonna go solve it. And I too have experienced that. And I happen to live in a particular part of the US that it's dominated thankfully, by two carriers, that's why I was able to fire one and be able to stick with the other. But if I moved to another city in the US, some of these airlines would have no relevance. And so all that status disappears. So I would want to be able to have that and you're right, so much of what my purchasing decisions are based off of, or on the on my loyalty and some of it even translates into all the ancillary benefits, right? The credit cards, the hotel members, all of that ties into, can I earn a particular thing with this airline this year, because that particular thing is so valuable to me. And being able to translate those dollars to another carrier through something easy, like status match would be very valuable to me, but I imagine also very valuable to the airline as well, making things simpler for them.

Mark Ross-Smith: 24:46

You know, it's actually really good for airlines, even the airline that quote is losing your business right because ultimately, all airlines want you to be what I call loyal to loyalty or to premium loyalty, right? They want you to keep using that current credit card, even if it's with another carrier. Because if you disconnect from that system, so you're not loyal to loyalty. What happens is, through your mind, you're like, Well, you know what, I've had these bad experiences, this airline has said, No, they're not going to do this. Give me a status match or whatever kind of disk in your mind. That's, that's the moment that's like, well, you question yourself, like, what? Hang on? I've been going to this airlines website for the last 14 years, I would book it, I spent how much money with them? And, you know, the saying no. And what happens then is like, well, you know what, I've just seen his offer for this credit card, it's Cashback Card Stock and earn airline miles anymore. But look, it's 5% cashback, hang on, and you start doing the math in your mind, you're like, Well, hang on, I might be better off getting this card instead of the airline card. And hang on. This is other airline, there's other low cost airline or a different airline that has no premium loyalty program. It's just a lot cheaper to go to the cities, I need to fly for work. And, and what happens is, people sort of kicked out of that premium loyalty sort of flow. And this is actually bad for all airlines. So status matching, even if you're losing a customer, it's actually better for them to take up status with your competing airline than them to disconnect entirely because as soon as they disconnect entirely, they get the cash back credit card, they cancel the CO brands and and then what happens is you start flying based on price and network and timing instead of based on the flashy, shiny platinum card you've got in your wallet. Yeah, right. And that's the worst thing ever for airlines.

Rick Denton: 26:41

And I like that that loyalty can help all the way back to our first question how to loyalty and customer experience tied together. Sometimes loyalty itself can overcome a bad customer experience up to a time that's as you're describing that loyalty, right? I can overlook that recline, I can overlook that bad seat assignment, I can overlook that missed handling to a certain degree. But customer experience then influences that loyalty over time they weave together and separately. And that's why I want to close with this. We're kind of we're actually a little over time. That's all right. The theory of loyalty is good, right? We what we just said there, it influences customer experience and vice versa. But actions, what matters to the customer. And we alluded to a little bit of it earlier, but how do you help companies get out of that theory of loyalty and into actual action of loyalty and customer experience?

Mark Ross-Smith: 27:27

So again, I guess the question is really, how do you scale this? Right? How do you do it more than just a one on one kind of experiences? Which is difficult when you've got how many millions of airline passengers a year? Right? So you know, I think step one, I mean, for every our employees listening, be a customer of your products, but it's kind of a step. Easy, basically to do it

Rick Denton: 27:51

You also don't want to say like, yeah, of course, you got to listen first, right about everybody understand that? Yeah, listen, yeah.

Mark Ross-Smith: 27:56

Step two, what I would do is show other customers, how you're wooing your best customers, right? So imagine if like an airline created a YouTube channel something and sort of posted videos, or, you know, like, there's TV shows, like the airport TV shows, or the border control ones, you know, they show you behind the scenes of the airport, that cool stuff. Why don't airlines do that with great customer experiences. Interest should show the world how how the small things they do really well, everyday showcase the good things. You know, kind of like that you remember the old the WestJet Christmas videos, they used to do remember

Rick Denton: 28:31

that and I still remember crying when I saw it, that thing was beautiful.

Mark Ross-Smith: 28:35

It wows you to the degree that you didn't expect it. And for these people that were part of that I think this would have created a lot of life, lifelong WestJet fans. And you know, why can't airlines do more of that maybe not to the same degree and not every week. But you know, something really cool that people will just never expect. And I think you know, if they did that airlines really showcase what they can do what they're capable of doing, because airlines have the ability to invoke emotional experiences better than a lot of brands in the world. And I think they should really leverage that.

Rick Denton: 29:08

So that I'm hearing the Listen, the emotion and by the way, Mark, let's talk after the show some time, maybe you and I need to create that offering for the airlines and we suddenly become a new YouTube channel, but we'll talk about that later. Let's leave it there. I like that. I think we can, we can end with that. I love the emotion aspect of it. And that doesn't surprise me when you're describing loyalty, having such an emotional component to it, that airlines do have that ability to deliver and also destroy create great customer experiences and emotions and the like. So Mark, if people want to know a little more about status match more about you how can they get in touch with you

Unknown: 29:43

statusmatch.com You can add me to LinkedIn, pretty active on there, or I have a blog traveldatadaily.com It's free. Check it out.

Rick Denton: 29:50

Awesome. I will get that all in the show notes. Scroll down. Check that out. Connect with Mark and learn more about status match and then get out there and do some flying. Find the airlines that you love and let both mark and me No, have some great experiences out there, Mark. It was a delight talking with you today. I really enjoyed it. I certainly have learned some things about airline loyalty. I hope that what we talked about in the middle that some day we'll see some improvement throughout the airlines. And that day is coming. I'm looking forward to that. But wonderful conversation. Thank you today, Mark. I enjoyed it.

Mark Ross-Smith: 30:23

Thank you, Rick. It's been a pleasure.

Rick Denton: 30:28

Thanks for joining us this week on CX Passport. Make sure to visit our website cxpassport.com where you can hit subscribe so you'll never miss a show. While you're at it, you can check out the rest of the EX4CX website. If you're looking to get real about customer experience, EX4CX is available to help you increase revenue by starting to listen to your customers and create great experiences for every customer every time. Thanks for listening to CX Passport and be sure to tune in for our next episode. Until next time, I'm Rick Denton, and I believe the best meals are served outside and require a passport.