Travel and Lifestyle Clubs

Travel and Lifestyle Clubs: Benefits and Challenges for Non-Travel Businesses

Many would argue that American Express and other card companies are really travel and lifestyle clubs at heart. Why would consumers pay hundreds of dollars in annual fees to use an Amex Platinum card, or thousands of dollars to use an Amex Centurion? The difference is in the benefits – each card offers certain elevated benefits (such as lounge access, or concierge services), and travelers will gladly pay a yearly subscription to access those benefits and be part of the brand.

In the same way, travel clubs can add a sense of elite and exclusive value for members of any company or organization, inside or outside the travel industry, while increasing revenue from membership fees, attracting new members and strengthening brand affinity across the board.

Here are a few question and answer topics to introduce non-travel businesses to the possibility that they could benefit in revenue, brand affinity and loyalty by offering a technology-based travel club, in partnership with Custom Travel Solutions…

What is a travel club and why would a non-travel organization offer a travel club to its customers or members?

For years, non-travel retailers have been using airlines’ frequent flyer programs to add value to their core businesses and increase revenue, brand affinity and loyalty. Travel clubs similarly help non-travel businesses and membership-based organizations achieve their goals for membership, brand affinity, customer retention and revenue – by branding integrated travel and lifestyle benefits to their company or organization, increasing engagement through an online platform, and ultimately, converting brand affinity into brand equity.

Like frequent flyer programs, the travel club concept is an idea that works because nearly everyone aspires to travel – they want to see, learn, taste, enjoy and experience. Leisure travelers in the U.S. spent $718 billion in 2017 and more consumers are mixing business and leisure trips. Despite these ready-made revenue opportunities, few companies or organizations outside the travel industry have the resources to build and maintain a travel club for their customers or members.

What is the biggest benefit that a custom travel solutions provides?

In most cases, 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 –
travel clubs should adhere to brand standards and deliver real value to members, who have many options when it comes to trip planning. Travel clubs are meant to be unique, exclusive and beneficial; this is how they improve loyalty and differentiate an organization in the eyes of existing and potential members.

In today’s “subscription economy” (think Netflix, Spotify, Birchbox) – where having a user base is the real
financial capital – a membership-based organization’s best opportunity to add revenue and strengthen brand
affinity is to offer exclusive online access to third-party products and services that their members value – and
few things are as widely valued as travel and lifestyle benefits.

The travel club concept presents a unique business case for any company or organization that wants to increase revenue and strengthen loyalty with their customers or members. This includes frequent flyer programs, shared interest clubs, banks and credit unions as well as retailers, network marketing companies, concierge/lifestyle programs, media publishers and more.

What are the biggest challenges to implementing a travel club?

The biggest challenge is that non-travel companies and organizations generally lack the know-how, resources and budgets needed to build a travel club from scratch and manage vendor relations with travel suppliers and distributors. And yet, who knows more about their members – or has better contact with them – than the company or organization itself? That’s why travel clubs have been growing outside the travel industry: non-travel organizations can offer products and services they know their audiences will value within a club framework.

Many non-travel organizations have never even considered a subscription travel club as a marketing strategy.
By working with a partner that specializes in creating travel clubs – with established travel inventory supplier
networks and a customizable UI platform – organizations can quickly and easily introduce the concept to their members or customers, immediately granting them access to comprehensive travel and lifestyle benefits.

How does Custom Travel Solutions help non-travel businesses overcome obstacles to offering a travel club?

Because the travel industry serves such a large and diverse group of people, there are abundant opportunities for third parties to sell ancillary products and services to travelers. 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%. Still, 60% of brands struggle to achieve this, which is why many are partnering with third-party companies and discovering new revenue opportunities.

With today’s renewed focus on 1:1 customer relationships, travel operators will need significant fulfillment capabilities to avoid the “overpromise and underfill” scenario. Witness last year’s Fyre Festival in the Bahamas where luxury travelers were stranded with no support and quickly turned to social media in distress. Rather than bear the burden of fulfillment alone, travel operators depend on non-travel organizations to add value to the chain through travel clubs and other loyalty offerings, which provide elite travel and lifestyle benefits to a wider audience, more efficiently, cost-effectively and profitably.

If you are curious to learn more about if a travel club applies to your business and how it can help you drive revenue, increase brand affinity and strengthen loyalty for your customers or members, check out our report, or simply contact us here. We’ll be happy to talk you through it and explore how your business or your members can benefit from custom travel solutions.

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