How Non-Travel Groups Can Benefit from Travel Clubs and the Sharing Economy
In the past ten years, services like Airbnb, Lyft and Uber have gone from being the cool/new “disruptors” to being the face of a new economy – a “sharing economy,” as it’s called.
The concept is really simple: identify underused assets such as private vehicles, spare bedrooms or excess travel inventory and create a private market for those assets online. This opens up an “ecosystem” that allows third-party brands or organizations to harness their customer/user base and give them access to discounted products and services online.
The travel industry helped pioneer this opportunity through frequent flyer programs that generate cross-brand engagement and loyalty. In the case of travel and lifestyle clubs, members pay a monthly or yearly subscription fee for discounted access to travel and lifestyle benefits – such as premier lounge access, emergency medical evacuations and travel insurance. In return, those organizations add new revenue from subscription fees, strengthen loyalty with existing members, and attract new customers by aligning their brand with exclusivity and world-class products and services through a private club.
Best of all, the organization doesn’t have to lift a finger outside its core business or mission – online clubs can be offered “as a service” and made easily accessible to members of alumni clubs, banks, credit unions, frequent flyer programs, employee groups, network marketing companies, retailers, shared interest clubs and many others.
Travel Clubs and the Sharing Economy
For airlines, hotels and other travel brands, the sharing economy is evolving from a competitive threat to a unique business model that meets a real industry need. For example, Hyatt Hotels invested $15 million in Onefinestay, an upmarket rival to Airbnb. The reason for this shift is that any company or organization with a website has a user base – and the revenue potential of those users is notlimited to the organization’s core products and services.
There are many different online club categories that a brand or organization could potentially offer in the “sharing economy,” but few things have proven as effective as travel and lifestyle clubs. There is simply too much demand for any online travel agency to fill and their costs for acquiring new customers/users are sky-high. Travel clubs help introduce excess travel inventory to a specific group of users, such as credit union or loyalty program members, and matches available inventory to their needs and interests.
By carrying out data-driven marketing activities based on a person’s needs, interest and behavior, brands have been shown to increase sales by 15-20%. But 60% of brands struggle to achieve this, which is why many are partnering with third-party companies and discovering new revenue opportunities online. One Instagram influencer known as “Millionaire Mentor” demonstrated the potential for affiliate marketing and similar online revenue programs: he amassed millions of subscribers and generated $7 million in retailer sale (in one year) simply by offering third-party products and services that fit his audience’s interests.
Travel clubs represent a similar opportunity for membership-based organizations to become the go-to channel for all their members’ travel needs.
Creating and Driving Loyalty Through a Travel Club
Most non-travel organizations develop an interest in travel clubs because they want to bring in more revenue from membership fees. This is a strong motivation, but it’s also important to consider brand affinity – the travel club needs to adhere to brand standards and deliver real value to members, who have many options when it comes to trip planning.
Few companies outside of the travel industry realize the huge opportunity that exists for them to drive loyalty and customer engagement with travel clubs. Travel clubs, offering consumers elite travel and lifestyle benefits, can help non-travel companies create new revenue streams and increase customer retention. The variety of ways companies create and drive loyalty continues to expand – and travel clubs offer an opportunity that many brands haven’t considered.
Want to learn more how travel clubs help increase revenue, strengthen loyalty and convert brand affinity into brand equity? Find out if a travel club can work for your company.