Welcome to Travel Again presents the weekly travel roundup covering the headwinds and tailwinds impacting the business of travel. Please welcome our hosts, Mike McCormick and Ed Silver. Hello Mike. Nice to see you. Good to see you, Ed. All right, welcome to the Travel Again podcast. Mike, this is a spotlight edition and today we are spotlighting a company that is rethinking loyalty at its core. Very cool.
Loyalty is very hot as we know. It’s a big focus of certainly every travel brand out there. There’s a plethora of programs out there that people try to pick from, use, manage, and probably half of them they’ve forgotten they’re even a member of. But there is a lot going on in this space and the intersection of that and all the advancements in technology and AI will be a really interesting topic for today.
All right. So, speaking of it, Mike, let’s just jump right in. We are going to be spotlighting a Phocuswright Innovation Award winner. They are working to transform how loyalty rewards work for both consumers and brands. He won this award and as part of it he had a chance to come on and spotlight his company as part of our relationship with Phocuswright. So, I am thrilled to have him. We will welcome to the stage Robert Wesley. He is the founder and CEO of My AI and co-founder of the Mi Protocol. A former international diplomat, Robert previously founded a graph computing company whose platform was adopted by law enforcement and security agencies, a nonprofit with researchers across dozens of countries, and spun up an AI and blockchain venture studio. Please welcome to the stage, Robert Wesley.
Thanks, guys. Hey, Robert. Well, first off, congratulations on the award. Congratulations. Nice work. No, I really appreciate it. We’re very pleased and very honored. You’re certainly at a very interesting intersection right now for the travel industry. That intersection of travel loyalty, AI… everything is kind of really honing in there and big money is being spent. We contend it’s going to really transform a lot of the power; there will be a power shift in the industry that’s all related to this. So I think you’re in a really, really interesting sector.
Before we dive into the business, a little bit of how you got here. Everybody has their story in terms of your past experiences and what led you here. Give us a couple minutes on your journey to today.
Thanks so much Mike and Ed for having me on. My journey of getting here to this podcast is quite circuitous. I started off doing something completely opposite of loyalty rewards, a completely different field. As you mentioned in the intro, I worked as an international diplomat. I worked for the United Nations and international organizations. I was also at the International Atomic Energy Agency. I was one of the lead experts in the world on illicit trafficking of nuclear weapons material. So when things were stolen out of the former Soviet Union and sold on the black market, I would sort of pop up and try to figure out where a lot of that stuff came from.
I sort of learned software development the hard way. I just needed really complex analytical tools for my work and so I started figuring out how I could get those developed. That really spurred an interest in software creation. Software is like this putty that you can mold into whatever creative ideas that you have. I really love that. I’ve since created a few companies now, as you mentioned: deep tech work with graph computing and network-based analysis, some AI and blockchain. I’ve also done nonprofit work and investments in venture building. I come from lots of different subsectors, but in terms of a thread of life, they’re all connected.
Leading up to where you are today and what you’ve been working on, what problem are you trying to solve for consumers? We all think of loyalty from a personal consumer perspective in a positive way, but where’s the problem you’re solving? How does this benefit the consumer?
I think it’s very important to start with the consumer. A lot of the time we’re very focused on B2B relationships, especially on travel and hospitality. It’s all about these relationships that we think matter the most, but it’s really the consumer approach that matters the most. This is becoming more and more important. Hopefully I get to talk about that a little bit later.
From a consumer’s perspective, when we’re talking about loyalty rewards specifically, there’s a number of well-known issues. I think we’ve all started accumulating lots of different loyalty points from different loyalty programs. The statistics are something like 8 to 14 on average in the US. Someone, maybe Ed the other day, told me he has a hundred different loyalty programs in which he’s a member. I do, I counted them at one point.
There’s this general problem of how do you get organized and how do you keep this organized. Why should I care about these loyalty programs when I don’t even remember subscribing to them? Then you have the case where you’ve given me points or miles in a program but I have no idea what I can get for them. In fact, last year I could get a lot more with the miles that I had than I can this year. So it seems like everything is depreciating in this sector. Maybe people are losing general interest in this type of rewards program.
You can look at some statistics and you can see a decline, especially with certain demographics under 50, in enrollments and usage of loyalty points. You have to ask yourself these questions: why is that happening? Are we really making it easy for businesses and for consumers to know about the rewards they have, to be able to quickly use them, and to actually get value out of these rewards? This is the problem set that we’re addressing from the consumer’s perspective.
Well, and I think there’s a little something there too where there’s that old kind of thinking around breakage and how it’s a positive thing if there’s a whole accumulation of miles and points and somehow I’m getting the loyalty without having to pay the price. But the realities are that it’s kind of an empty promise or an empty feeling for the consumer. If I’m not really getting the value, then that relationship with the brand is not really forming. One of the things that really struck me in your philosophy is this whole notion of having an open versus closed mentality with programs. Tell me a little bit more about that inflection point and where we are heading.
This is what makes this space really interesting for me. As you know from my background, I could be working in dozens of different spaces and tackling lots of different types of problems. Why is this problem really interesting for me right now? It is because I feel like we’re in this almost inflection point from a consumer behavior perspective, from the dynamics of what consumers expect out of the businesses that they work with, the brands that they want to engage with and be loyal to.
From the lens of loyalty rewards, you have a big change here. In the past, it was a perception that a customer or a user has to be loyal to the business themselves. That’s like the loyalty dynamic: the customer is loyal to us. What’s changing now is that there’s an expectation that the businesses need to be loyal to the consumer. That’s not just a play on semantics. It’s actually true from an expectation perspective. It’s almost like a paradigm shift. There’s this antiquated system of “you need to do something for me to earn loyalty from me” from a brand’s perspective, moving to the brand necessitating going the extra mile to prove that they’re providing value to their customer. You have this need to create a more ongoing, more dynamic relationship between the business and the brand, and old loyalty programs are just not able to do that.
Secondly, I think it’s quite important right now when you consider machines coming more into the equation. I’m not going to go into the technology side of things necessarily unless you guys want to go deep there, but I think it’s important to understand that consumers are very much emotionally driven with loyalty. They need to feel something from the business. They need to feel the love from the business. But on the other hand, machines are starting to intermediate on behalf of consumers more often with businesses and this is just going to accelerate dramatically over the next 12 to 18 months.
I think this is really the exciting point. So what do you do from a loyalty perspective? On the one hand you have the consumer which is very emotive. The experience needs to be very emotive for them. But the machine—they’re not emotional, at least not yet. You can’t really fool them. You can’t trick them with the same psychological tricks that we used to employ in loyalty schemes. You have to really provide value to them. You need to demonstrate the value of what you’re giving the customer as a return for their loyalty. That’s the change that I think executives need to start getting their heads around.
I think that’s really important. One of the things we’ve talked about at Travel Again Advisory with some of our clients is that consumers will be loyal to whatever systems, platforms, AI agents, or brands that know them the best, personalize their experience, and have a memory about who they are. In ChatGPT as an example, it really knows me really well at this point. It has a great memory about who I am and my family, and it can provide loyal recommendations that are really personalized. I would argue whoever cracks that code really will make that leap.
We talked about the consumer and the changing marketplace environment. You are in effect talking about creating a loyalty marketplace that’s really different. But if I am a brand and I have a loyalty program, the old thinking is “I’ve got my brand, I want to connect with my customers, and I want to keep them in this really closed environment where they only come to me.” In this environment, that’s not realistic. If I’m a business, why do I get excited? What makes me want to basically open my program, participate in a marketplace, and have my loyalty program alongside others? Help me understand the value in doing that.
You’re sort of drawing on a couple things. One is this idea of closed versus open programs or closed versus open systems. I think we can all generally get the feel that consumer and market sentiment is moving towards open programs. Connectivity is more important. Being able to interoperate or being able to use currencies and rewards across different businesses is currently where the market is heading. But we still kind of suffer a little bit from this old mindset of “why would I? It’s my customer, and it’s mine, and why would I ever let them do anything except for within my own ecosystem?”
By default, when you take that attitude, you’re limiting the value that you can actually provide to the customer. Now, in the new paradigm, it’s all about what value I can drive to my customer. You have limited redemption options and limited touch points for your customer, so they’re not hearing from you in a meaningful way anymore. They’re tired of your rewards program; they don’t find value in it and they wish it could do more. They feel like they’ve earned the rewards from this program, so why are you restricting them?
Now let’s break out of that. Allowing your customers to be able to use their points and rewards across a host of other brands and products dramatically increases the value of your program for your customer. That’s the first thing you’re doing: you’re driving them real value. Remember, machines will understand that perfectly. You can’t trick the machine. They will immediately see that that’s a valuable program to be enlisted in.
Secondly, there’s the long-term engagement with the customer. If you’re a brand and you have infrequent purchases, let’s say once every year, then how is the consumer ever going to think about you as a business? Are you going to send them a newsletter? Maybe they read it, maybe they don’t. But if they’re using their rewards across different products, you can automate the reach-out and the touch with that consumer and help them remember you during that process. I can say, “Oh, I hope you enjoyed that scarf you just bought in Milan. We were very happy to provide that to you. Would you like to earn more from our brand?” That creates an emotive experience for the consumer. They think, “Oh yeah, that brand really cared about me and they were willing even to let me do this on another business’s brand. They must really love me.”
The third aspect is that you can actually use rewards to acquire new customers. In a closed program, that’s impossible. No one cares that you have a rewards program; no one knows about it. In a more open program, you can attract new customers from around the whole ecosystem into your product. This is important for independent brands that want to grow their market share and really want to show that they’re a customer-first business. Those are the three value points I would hit on with most businesses regarding rewards programs.
I think you’re right. When you bring it back to fundamentals, you can see it depending on the size of the program. You have Marriott Bonvoy on one end and a small boutique hotel chain on the other. For a small chain, it’s “how do I get new members?” Even listening to the last earnings call at Marriott, growing Bonvoy and adding more members is highest on their agenda. That need exists across the entire spectrum. It’s just such a valuable program for them.
The interesting part is really the mindset you’re tackling. It’s not the realities of how a brand could benefit, it’s that leap of faith. If I do this, I have some risk, but at the same time, the benefits of what I can get back and the connection with the customer are real. If you know me, you’re taking loyalty into a different zone, which is really positive.
We’ve listened to brands and we understand that there is this bias against opening up their program. We’ve really worked very hard on trying to figure out how we can derisk that for them and reduce the friction of engaging in this program. For one, we’ve designed our system so that it’s more of a plug-and-play system. If you have an existing loyalty program, you can just plug it in and immediately get the benefits. You get to maintain your branding and brand equity. You don’t have to adopt a “Bonvoy” branding if that doesn’t fit with your strategy. You can spin up a program without hiring additional staff. Do I have to launch a new department if I want to increase or launch a new program? You don’t have to do that anymore. When you want real change to occur in a sector, you have to solve a lot of these really hard problems for the businesses to allow them to adopt quickly and with less risk.
Looking out over the next three to five months—I feel like you have to say months now instead of years—what are you seeing in terms of the future of all this? You have a compelling vision about where loyalty is going. What would you say to travel execs in our B2B audience? What message do you want to leave them with?
Keeping it really tight within loyalty rewards, you have to really understand agentic commerce immediately. This is changing everything. Agent intermediation means that if an external agent can’t understand your loyalty rewards program, they’re not going to prioritize your offers or your business to their consumers. That’s extremely hard.
We’ve built two new agent projects that allow through an integration with us to be immediately viewed and transactable from any external agent. Agents can find your program, transact your program, and you can acquire new customers through the agents themselves. It’s a question of “how do I take action on this really fast, Robert?” and we provide you an API to do that.
That’s really important. The other importance within this agentic, AI-based economy is there’s a massive first-mover advantage. If you think about traditional technologies, you can sort of sit back and watch how things develop for a while as a large corporate. I think boards need to be much more agile and executives need to take action immediately because first movers can take such a huge amount of the market during that period. You see this with OpenAI and any AI-engaged first mover. If you’re the first airline to allow external AI agents to understand your rewards program, you’re going to get volume just from that. And if it doesn’t cost you very much to do that, then why would you not want to move in that direction? Your customers would just appreciate it by default. Even if you didn’t get the thousand-x ROI that you could get, you’re still going to get a positive ROI guaranteed if you move quickly.
And it’s a way to differentiate in a big way. After this conversation, it’s very clear why you won the award from Phocuswright. You’re right at the precisely innovative area and your approach is really interesting.
Thanks so much guys. I really appreciate it. We’ve got a lot to reveal coming up this year. We have some big surprises. We have a lot of problems that we’ve already solved and you’ll stay tuned for some new ones.
Fantastic. All right, Robert, thanks for joining us and sharing your perspective on the future of loyalty. Robert Wesley is the founder and CEO of My AI and co-founder of the MI Protocol. Robert, thanks for joining us today. Thanks for having me.
All right, Mike, that is our edition of Travel Again Spotlight. To learn more about My AI life or become part of their platform, head over to their website and check it out at myai.life or follow them on X at @MiProtocol. Mike, that’s it for this edition of the spotlight. We will see you next time. See you next time, Ed.