Strengthening Travel Offerings for Financial Services
The importance of financial services to the travel industry cannot be overstated. Commercial and co-brand credit cards have helped both the travel suppliers (airlines, hotels), card companies (Visa, Amex), and issuing banks segment their common customers and understand consumer spending habits. Travel has been the ideal “laboratory” for financial services because it cuts across so many different financial segments and categories.
But in addition to financing leisure travel for the average consumer, most financial services companies are after the big fish, the affluent and credit-worthy willing to pay hundreds of dollars to join a card program like the Amex Centurion. This will require a better customer and user experience online and more value in the offering itself. If consumers are willing to pay big money, then they have even bigger expectations.
Affluent households represent 27% of the US population and spend 56% of all dollars in travel categories, thanks in part to their frequent use of travel cards to make purchases. It is becoming harder to distinguish between the brand/customer experience and the card/program experience, because so many consumers transact with the travel industry through financial services programs, like Amex Centurion.
Financial Services and Travel Clubs: A Natural Fit
Another way to describe these programs? They are travel clubs, even if we don’t call them that. They use the appeal of travel products and benefits to sell non-travel products and services. Naturally, as travel technology has evolved and matured, the travel industry has built up its own programs and platforms and financial services companies are having to stand on their own as travel partners.
The travel club concept is not new, but now rather than banks and travel suppliers partnering directly and going through the lengthy/costly work and investment to build a program (or add on to one), both industries are relying more on travel technology companies (like Custom Travel Solutions) to handle all the requirements and logistics through a SaaS solution. These include technical and industry-specific aspects like fulfillment and vendor management, as well as support frameworks to create a great user experience for customers.
Financial services companies can still leverage investments they have already made, like keeping an existing program portal. Travel clubs by Custom Travel Solutions are a “plug and play” option that can be added on top of frequent flyer programs, co-brand cards, bank loyalty programs, credit union memberships and any other financial services offerings.
Investing in a Branded Travel Club
The benefits of travel clubs for the financial consumer are endless, but what about financial services companies themselves? Even the elite credit card programs have been adjusting their strategies, increasing membership fees and reorganizing rewards schemes. Why? They must reach a higher-value customer segment to maintain their program’s profitability, and the competition for these consumers is cutthroat.
Travel clubs are a low-cost investment for financial services companies to add new value to their existing loyalty programs and give members access to a wider network of elite travel and lifestyle benefits. As a private label offering, the travel club is completely branded to the company and integrated with existing systems.
You can book your demo session to take a closer look at our travel club platform and discuss how it can help your financial services company. You might also enjoy this blog on how travel and lifestyle clubs can help differentiate online banking for credit unions.