In the past year, several financial institutions have made
announcements that seem to indicate a consensus: Travel services are a valuable
perk for their customers.
For many of these companies, partnering with, or
acquiring, existing travel technology companies can provide a fast track to incorporating
new travel solutions into their offerings.
Examples of this include Capital One’s integration of Hopper
Cloud – announced
in March 2021 and launched in September - to power its booking platform for
its travel rewards credit card customers. In July 2021 United Kingdom-based
banking app Revolut
launched accommodation bookings powered by Expedia, and on the business
travel side, U.S.
Bancorp acquired travel and expense platform TravelBank in November.
More recently, GetYourGuide
announced a new booking site last week for American Express card members to
access the platform’s inventory of tours and activities as well as curated
experiences and discounts. And in May, during its investor
day presentation, JPMorgan Chase, which earlier this year acquired
luxury travel agency Frosch, announced plans to launch ChaseTravel.com later
this year, first for its credit card customers and then opening it to all Chase
customers.
Travel and loyalty
The flurry of activity aligns with data from Arrivia outlined
in its “Travel
Loyalty Outlook 2022” report, based on a survey of more than 2,000 U.S.-based consumers and more than 200 loyalty program administrators.
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While the report analyzes travel and loyalty across various
industries, it states, “financial
services companies have the most to gain by upping the value proposition of
their travel rewards programs.”
According
to Arrivia chief marketing officer Jeff Zotara: “Offering travel rewards is a
good first step; we know they resonate with cardholders and consumers. But if
credit card companies and financial institutions want to become their
customers’ go-to for everyday purchases and capture more of their travel spend,
they need to get to the next level by providing exceptional, exclusive
discounts combined with streamlined redemption and whole-trip booking
capabilities.”
According to Arrivia’s survey, 63% of industry respondents plan to offer new travel rewards or
benefits in 2022, including exclusive travel options, deeper discounts and
experiences or activities.
“These findings suggest that loyalty
programs that enable members to earn and redeem travel rewards can leverage the
recent surge in travel demand to capture more of their members’ spend,
incentivize new sign-ups and better engage with existing members,” the report
states.
A focus for financial firms
It is clear the banks upping their travel
offerings recognize that potential.
In her remarks during the investor day presentation,
JPMorgan Chase co-CEO of consumer and community banking Marianne Lake says: “Travel
has been the center of gravity for our Ultimate Rewards program for a decade
and remains the most aspirational lifestyle category for many of our customers.”
The company estimates it is a “top five U.S. consumer travel
provider” and will surpass $10 billion of travel volume on its new platform
next year.
We will deliver distinctive content and experiences and become a full-service travel agency to our small business and premium leisure travelers.
Marianne Lake - JPMorgan Chase
“We will deliver distinctive content and experiences and
become a full-service travel agency to our small business and premium leisure
travelers,” Lake says.
“So, let me bring this to life through our evolving super
app and ChaseTravel.com. Looking forward here we have 66 million U.S.
households, including five million small business customers. And now we have four
million Infatuation dining enthusiasts. We've got industry-leading products,
unmatched first-party data and a two-sided commerce platform. And our strategy
is to expose distinctive content to our broad customer base, making Chase the
best way to shop, pay and borrow. Starting, as I said, with travel and
introducing our customers to key merchants within our platform at scale.”
Since the launch nearly one year ago of the Capital One Travel
portal, powered by Hopper, the company says it is seeing a lot of pent-up
demand for travel from its customers, and its system has been designed to serve
that demand in a way that is easy and stress-free.
“When we set out
to build Capital One Travel, we spent a ton of time talking to our customers
about their needs, especially in a post-COVID travel age. A lot changed for
travelers in the 2020 to 2022 timeframe, and we found that the things that really
matter to our customers are features like flexibility, so they are protected
when plans change, and confidence that they are getting the best deal,” says
Jenn Scheurich, head of travel at Capital One.
“The platform
pairs Hopper's best-in-class technology with Capital One's customer focus to
create a seamless user experience with a digital-first approach.”
GetYourGuide co-founder and CEO Johannes Reck says a desire
to create an intuitive customer experience for card holders that taps into
current travel trends is the reason American Express has chosen to partner with
his company.
“Today’s traveler is looking for deeper and more meaningful
experiences. They want modern and digitized booking experiences, they want
simplicity and efficiency, they want the perfect balance of freedom and control
at every stop along the way, and lastly, the joy of unforgettable discoveries,
both planned and unplanned. As such, GetYourGuide provides innovations, such as
GetYourGuide Originals, to deliver experiences that customers desire,” he says.
In
case of the TravelBank-U.S. Bank tie-up, the focus has been to bring payments,
expense, reporting and travel management together for small- and medium- size businesses,
giving them a unified, efficient solution.
“What you get is a process where you can
dramatically simplify productivity when it comes to travel, because they can
book and now they can reconcile expense at the same time through a payment. It’s
done in one motion,” says Duke Chung, co-founder and CEO of TravelBank.
Says Jeff Jones, U.S. Bank president of corporate payments and
treasury solutions: “Partnering with
TravelBank before the acquisition, we saw firsthand how effective the
TravelBank solution was at helping businesses reduce costs and achieve greater
control over spending. Since the acquisition, we’ve been incredibly pleased
with the response from our middle market clients. There is strong demand for
end-to-end expense, travel and payment programs and we're delivering that with
TravelBank.”