Thursday, August 18, 2016

New website rewards business travelers who can be flexible

If you own or work for a small or medium-sized business that allows its travelers some flexibility, a web site set to launch next month could prove profitable to both the company and you, the traveler.

The web site, which will begin its launch in mid-September, is called “Upside.” In its marketing materials, the site describes itself as “[A] new and very different concept in the highly complex business travel market.”

The “upside” for the traveler is that those who have some flexibility, both personally and in their companies’ travel policies, can reap some nice rewards for themselves and help lower travel costs for their companies.

Unlike most travel websites, Upside does not show travelers long lists of flights, rooms and prices. Instead, the traveler answers a series of simple questions on the website or its app such as, “What time do you need to arrive?” and “Can you be flexible on using any of these nearby airports?”

Based on the traveler’s needs and flexibility, Upside puts together an all-in, one-price air-hotel package that meets all the business goals of the trip. Travelers see the details of their flights and room before they buy and can change any element they don’t like. Finally, there is no obligation to buy.

Despite the apparent similarities, Upside is not a booking tool. Instead, travelers buy a package and Upside books the flights and the accommodations. That makes Upside the “merchant of record,” which is a critical distinction in the airline and hotel industries.

At this point, astute travelers may be wondering whether purchasing travel through Upside will mean foregoing hotel points and airline miles. The answer is, “Yes and no.” Travelers will not receive hotel points but will still get the frequent flier miles to which they are entitled. However, in the case of most U.S. airlines [Seattle-based Alaska (NYSE:ALK) is an exception], mileage accrual has changed from a mileage basis to a revenue basis so the price Upside pays the airline for the ticket will likely be lower – and result in fewer miles – than if the traveler booked directly, and paid a higher fare.

Flexibility rewarded with a 'win-win'

An upside for the traveler is that the individual can receive gift cards to their favorite stores in exchange for voluntarily being flexible on their travel arrangements. "Being flexible" could mean trading a certain amount of personal convenience or comfort in ways that go above and beyond company travel requirements, such as using an alternate airport or staying at a hotel a few blocks from their meeting site.

The traveler can receive gift cards from merchants including Amazon.com, Home Depot, Target, Whole Foods and others, while the company benefits from reduced travel costs.

Unlike many travel sites, Upside does not work on commission. Rather, its business model employs the classic business tactic of buying wholesale and selling at retail. It does not sell “excess inventory,” but flows business travelers to airlines and hotels that want to increase their market share in the business travel sector. As anyone who has traveled extensively on business already knows, business travelers tend to spend more than leisure travelers and are therefore more highly sought after by both airlines and hotels.

Initially, Upside intends to focus on selling travel directly to employees at small and mid-sized companies, particularly where travel is lightly managed or unmanaged. For example, a prime target company would be one that expresses its travel policy as the simple directive: “Try to hold down your expenses and be reasonable in your choices.” Upside is not initially designed for large corporations that have heavily managed travel.

Nonetheless, for every rule there is an exception. When I worked for General Electric (NYSE:GE), one of the world’s largest companies, the department head who approved my travel gladly considered alternate travel arrangements if they saved the company money. Leaders in companies of all sizes understand the value of driving cost out.

While the website launch is still several weeks away, those who are interested in getting an early glimpse can sign up for a free VIP pass. In addition to being one of the first to try the new service, VIP’s will be entitled to a minimum of “$150 of free gift cards for every trip this year,” according to the website.

Visit my main page at TheTravelPro.us for more news, reviews, and personal observations on the world of upmarket travel.



Photos by Carl Dombek
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