As the Covid-19 outbreak rages on, many airlines around the world have had to look for alternative sources of revenue to stay afloat while identifying new growth opportunities in the post-pandemic world.
At Singapore Airlines (SIA), one of the most profitable carriers globally, those efforts include bolstering its KrisFlyer loyalty programme to identify new customer segments and increase revenue.
Most airline loyalty programmes, especially those that involve a large number of partners and merchants, often take a while to verify and reconcile miles and loyalty points earned by members across their networks. With blockchain technology, this can be done faster and in a more secure manner.
In early 2018, SIA started working on KrisPay, the world’s first blockchain-based airline loyalty digital wallet app touted to unlock the value of miles accumulated by KrisFlyer members.
At the time, SIA’s CEO, Goh Choon Phong, hailed the app as a ground-breaking initiative that reflected the investment the airline was making to significantly enhance the digital side of its business.
About two years later, the airline expanded on KrisPay, turning it into a digital lifestyle platform to engage users beyond flight bookings and mobile payments.
Now called Kris+, the app was launched in just six months and recorded about 20,000 downloads in the first three months. It rides on a private Ethereum blockchain involving only merchants and partners, and was developed by an in-house team in partnership with KPMG.
The project has also inspired SIA’s creation of KrisLab, an innovation facility through which it launches prototypes at speed in partnership with startups, established incubators and accelerators.
SIA’s work in developing Kris+ was recognised at the inaugural Computer Weekly Innovation Awards APAC 2021 when it emerged as the winner of the transportation category.
Elaborating on the success of Kris+, SIA said the app has strengthened its assets and that of its partners in retail and other industries.
And by using tokenisation, which replaces actual miles with a string of random numbers and letters, Kris+ has also improved the security of information passed between merchants and SIA.
Furthermore, the immutability of blockchain reduces layers of transaction verifications, enabling easy reconciliation and faster settlements.
Kris+ has since opened up new customer segments for SIA, including non-frequent flyers, while enabling KrisFlyer members to use their miles to pay for purchases at partner merchants and to accumulate loyalty miles for the next flight.
With more reasons to spend their miles, SIA said more customers have switched from other rewards programmes, increasing the airline’s revenue in the process.
In paving the way for the success of Kris+, SIA carried out a slew of change management activities, such as engaging all levels of staff across the company through meetings, presentations, internal communications and staff incentives.
It also sought to provide a platform for merchants to market to its customer base at lower customer acquisition costs.
“Though the original intent was to create a digital wallet, which would integrate SIA assets – KrisFlyer miles, boarding pass privileges and Singapore Stopover Holidays – we pivoted to increasing engagement on the ground and more lifestyle benefits beyond flights.
“This provided SIA with a new business opportunity while navigating the effects of the Covid-19 pandemic,” it said.