Two Students Cracked Loyalty Programs With One Psychological Trick

01 /The Concept

Arcube's job is to get passengers to fly the same airline again. The platform does this by putting the airline's existing ancillary services infrastructure to work in a smarter way – converting post-flight momentum into a genuine hook for the next booking.

Airlines have traditionally used miles for this. The problem: infrequent flyers don't accumulate enough miles to redeem anything meaningful, so there's nothing stopping them from buying the cheapest available ticket next time, which might be on a different carrier.

Arcube takes a different approach. The moment a passenger deplanes, the platform springs into action.

It analyzes the current booking and the passenger's flight history to build a picture of who they are and why they fly – and what ancillary services they're likely to want on their next trip. It then generates a personalized list of those services, with individualized pricing in miles or cash for each passenger. A business traveler might be offered priority check-in for 4,500 miles; a leisure traveler for 3,200 miles; a student flying home for 1,700 miles.

Immediately after landing, the passenger receives a thank-you message with that personalized list of add-ons for their next flight. The key step: they're invited to convert their existing miles into a selection of those services right now – receiving codes they can apply at their next booking. If miles fall short, the gap can be topped up with cash, as usual.

Now the passenger has a real reason to book with this airline again: they've already locked in a set of services that will make the next flight more comfortable.

Arcube piloted the platform with Etihad. The pilot ran for 12 months across 1,300 passengers, half of whom were flying Etihad for the first time. Participants converted 16.5 million miles into ancillary services, and the average booking value rose by 10%, generating $1.6M in additional revenue for the airline.

Arcube earns commissions on ancillary service sales and likely on subsequent bookings. Etihad is the first signed client; 14 more airlines are reportedly on the waitlist.

The company just raised £1.2M in its first round.

02 /Why It Matters

Arcube was founded – without outside investment – by two people who were still students at the time, both with entrepreneurial experience. They managed to land Etihad as a first client and reached $625K in revenue and profitability while still in school. That's a notable start.

The platform's real insight is that airlines are sitting on behavioral data about their passengers – how early they arrive at the airport, how long they spend in the lounge, what they order on board – that they've never actually used to their advantage. The booking interface that a frequent flyer sees when booking their tenth flight with an airline is, absurdly, identical to the one a first-time passenger sees. Arcube's founders found that strange. And they built the platform to fix it.

The psychological mechanism they're exploiting is well-established: people are far more motivated to avoid losing something they already have than to gain something they might have in the future. Applied to loyalty: holding 5,000 miles and knowing they could be redeemed someday is one thing. Converting those miles right now into priority boarding and a seat upgrade for a flight that's already on the calendar – and knowing you'll lose that benefit if you don't use that airline – is something else entirely. Structurally identical; psychologically far more powerful.

Airlines are currently showing strong appetite for tools that drive loyalty and ancillary revenue.

Gordian ([related review](/review/oni-otstali-a-my-zarabotaem)) built a platform through which airlines can sell ancillary services on third-party travel marketplaces – ones that previously only facilitated ticket bookings. That startup raised $33.2M. Caravelo ([related review](/review/pribyl-iz-niotkuda)) built a subscription platform for frequent flyers on fixed routes, raising €9.2M. Fetcherr ([related review](/review/s-gibkimi-cenami-bolshe-zarabotaesh)) raised $114.5M – including $90M in a single round last summer – for a real-time dynamic pricing platform that adjusts ticket prices automatically based on predicted and actual demand.

Beyond aviation: Seatfrog ([related review](/review/zhelajushhih-bolshe-chem-kazhetsja)) built an auction platform for train passengers who bought economy tickets to bid for an upgrade to business class. The train runs anyway – but if some passengers pay extra to move into otherwise-empty premium seats, the rail operator captures incremental revenue it would have left on the table.

03 /Opportunities

One direction worth pursuing: building platforms for generating ancillary revenue in businesses with fixed costs.

Whether it's a flight, a train journey, or a hotel stay, the core costs are largely fixed regardless of how full the plane, train, or hotel is. Every additional passenger or guest – or every additional service sold to an existing one – drops almost entirely to the bottom line. The challenge is learning to offer these services at the right moment, to the right person, without creating visible conflicts between customers paying different prices for the same thing. Crucially, the services don't need to be invented from scratch – they should come from what the business already provides or could provide at minimal additional cost.

Opportunities like this exist across many sectors. A simple recent example: a major e-commerce platform offered the option to pay a small premium to shorten delivery by two days. That presumably happens within existing logistics operations – certain orders simply get prioritized in the queue, saving those two days.

The practical challenge is identifying the right services – ones the business already provides or could provide at minimal additional cost – and automating the matching of the right offer to the right customer at the right moment. The data signals already exist inside most businesses; the gap is a platform that turns them into triggered, personalized upsells rather than blanket promotions.

A related but distinct play is redesigning loyalty programs to replace "future gains" with "fear of loss."

The goal is to get users to spend loyalty points against a future purchase immediately – while they're still in the warm glow of having just completed a transaction. A pre-committed purchase, or part of one, anchors them far more reliably than abstract points sitting in an account they may or may not remember to use.

A mundane personal example: earning points with every morning coffee at a local café does nothing to motivate returning to that same café tomorrow. The points are just a bonus for a decision already made on other grounds. But if at the end of a visit the choice were to accumulate points the usual way or convert them into tomorrow's coffee with a bonus pastry thrown in – there's a real chance of coming back specifically for that coffee, because it's already "paid for." Not a financial incentive – a purely psychological one.

The fastest way to validate the approach is to pilot it with a single loyalty program in a category where customers already transact regularly – quick-service restaurants, coffee chains, or fuel retail are natural candidates because transaction frequency is high and the next purchase is near-term and predictable. A program that converts post-transaction points into a committed next-visit offer can be tested against the baseline in weeks.