Delta coins its own term for high spending millennials – Emerging High Value Customers

10 January, 2018

Most airlines worldwide understand the importance of crafting a strategy to resonate among millennials, but Delta has coined a new phrase for that ever important age set - emerging high value customers (EHVCs).

Delta admits it has much to learn about the millennial mindset, but understands the urgency in mastering the preferences of that age group. The airline "has been really intently focused on a core group of customers who represent what will be 50% of the sales of business flights by 2020", company chief marketing officer Tim Mapes recently concluded. "You guys know them as millennials; we refer to the here at Delta as EHVCs," he explained.

The logic behind the label is there are groups in the millennial demographic that work at large companies such as Deloitte of McKinsey that are emerging as high frequency business travellers. Delta is catching those customers "upstream" said Mr Mapes in order to establish relationships that in in some cases begin while those passengers are still in college.

Delta believes there it can learn lessons in catering to millennials from other brands such as Starbucks or Amazon. Those companies, along with Delta, are among Forbes' top 15 most relevant brands in America.

Even as Delta admits there is much to understand about evolving expectations of millennials, the airline does conclude 60% of those EHVCs are more likely buy-up for products such as extra legroom and other add-ons than non-millennials. Unsurprisingly, that age set also places a great value on Wi-Fi, which in some cases drives share shift from other airlines that don't offer connectivity, said Mr Mapes.

Delta believes its approach of listening to that customer segment and responding with products the value is reaping rewards. Its year-on-year preference scores among EHVCs for Jan-Oct-2017 grew from 41% to 48%.

Furthermore, 97% of those EHVCs "will post something to social media immediately following their travel experience," Mr Mapes concluded. "So how well we serve them, it gets more people like them, so that preference matters."

CHART - Delta Air Lines says its year-on-year preference scores among EHVCs for Jan-Oct-2017 grew from 41% to 48% over the first ten months of 2017Source: Delta Air Lines