Banks look to travel to boost customer loyalty

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.

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,” 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.”