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Welcome to Travel Buddy
In this episode of the Travel Buddy podcast, Brandon Giella interviews Nowell Outlaw about travel loyalty programs from the perspective of loyalty vendors. They explore the differences between single source solutions and aggregator solutions, emphasizing the importance of considering more than just price when choosing a travel loyalty vendor. Nowell highlights that while price-sensitive consumers are important, the overall value and customer service experience are crucial for maintaining brand reputation. They discuss the benefits of aggregator solutions, particularly their ability to offer a diverse and global inventory, and the role of AI and ML in enhancing these programs. AI can monitor price changes and improve customer experience by offering better value. The conversation underscores the need for comprehensive planning in loyalty programs, including global inventory, currency considerations, and reliable service, to avoid customer frustration and ensure a seamless travel experience.
Transcript
Brandon Giella (00:01.282)
Hello Noel and welcome back to the Travel Buddy podcast. Today we are gonna talk about loyalty programs from the loyalty vendor perspective and we’re gonna compare, contrast the single source solutions and aggregator solutions and what some limitations may be of the first. And I wanna get into what’s going on in that market and what you’re thinking about that.
Also, you mentioned price sensitive consumers, but I want you to talk about that price is not the only thing when you’re considering a travel and loyalty vendor. And then I also want to touch briefly on AI and ML and some of the cool things that you guys are working on and why aggregator solutions are great for that kind of feature. So I’ll let you take it away. So tell us a little bit about Travelty.
Travel loyalty programs, like real brief description and then tell me about the single source aggregator contrast.
Nowell Outlaw (00:58.249)
Sure. Yeah, I think, you know, we get calls all the time from people who are loyalty program providers, right? So they’re currently selling gift cards to consumers. have brands. I mean, these could be food chains, right? That have points programs. It could be HR tech rewards and recognition programs. It could be, you know, your traditional earn and burn, even financial services companies. There’s a lot of startups that
credit card companies, right, that are also offering rewards programs that are starting to look at travel as an interesting fit. And, you know, I think the interesting thing is that what we’re seeing in the market is a lot of people, one, they think, well, let’s just add travel. And that’s super simple to do. And I don’t think they really understand what they’re signing up for, right? Because a lot of people start with the, well, let’s, they start from a tech focused.
kind of we come to this from a tech and how does the tech fit and is it, you know, is it hotels or is it air? Is it, you know, cars and activities that cruise? And I think the interesting thing about it is that, you know, you also have to think about the value to the consumer that seems to be missing from the equation a lot. and then what also seems to be missing from the request and RFPs and things that you see is a real focus on the customer service experience, right?
because we had a loyalty program that has an existing travel thing now. Jokingly, yesterday we were reading the Google reviews about them and it was crazy. All the complaints, all the B2B complaints, all these other things. You’re like, wow, people really have to be smart about who they’re doing with because it does impact their brand. I’m not sure that when they’re like, maybe it’s some.
Program Manager is like, well, let’s just add travel feature function. It’s like, you also have to formulate the, know, this is your customer and your brand experience that goes along with this. So when you’re looking for a partner, you better pay attention to how they talk about service levels, response times, people being available on the phone, all those other things. Make
Brandon Giella (03:13.435)
If you’re gonna do it, do it well. Because you’re gonna get feedback.
Nowell Outlaw (03:15.923)
Correct, for sure. For sure. you know, we see people, know, there’s lots of inventory sources, right? And there’s lots of ways to do this. you know, there are brands that race to the bottom, right? And what you see out of that is people who think they had a booking, right? They think they had a reservation at a hotel and then they get there and it’s not there, right? Things like that happening when sometimes the choices of kind of these, you
I’ll call it tertiary providers that are way downstream in the market, Do they really, know, price is just one element of how to do this the right way, right? And it seems like people are really focused on price,
Brandon Giella (03:57.637)
Mm -hmm. So.
Okay. Yeah. Before we get there, tell me a little bit about that. If I’m understanding the basically the two segments of this market, you mentioned like there’s a single source, you know, way to go. And then there’s the aggregation way to go. Like, tell me about those two a little bit.
Nowell Outlaw (04:16.029)
Well, so if you’re a loyalty brand and you just are offering loyalty in the United States, maybe a single source supplier for let’s say hotel inventory is the way to go. But if you’re offering a global brand, not all inventory suppliers can handle the globe. And so one of the things that Switchfly does quite frankly is we do a really good job at aggregating the best inventory across the planet.
and a lot of single source suppliers might be really good with a really good inventory in say Europe, right? Or they have a really good inventory in North America. But if your users, right? If a loyalty programs users are like, you know, we want to book a trip in to France or to Germany or whatever, you have to make sure that you have the right mix of things, if that makes sense, so that there is good inventory, right? What you don’t want is we just
We just signed up with a supplier and they service the United States, but we can’t find any inventory in Japan, right? Or we can’t rent cars outside of the United States, right? And we see a lot of that where there’s people trying to develop these new hotel inventory specifically and channels of that, but they’re not necessarily on a global scale yet.
Brandon Giella (05:40.767)
And that gets back to the customer experience that you’re actually, because if somebody’s going into and wanting to travel somewhere and there’s not a particular place that that’s where they want to go, but there’s no inventory for that, that could be a big problem. Yeah. Yeah.
Nowell Outlaw (05:50.655)
That’s That’s right. That’s right. And that’s what you see is people, depending on where they’re traveling and where your customers are. So if you’re a loyalty program and all of your customers are in Mexico, are they all traveling within Mexico or where are the destinations that your consumers might want to go to?
Brandon Giella (06:12.962)
Right, so when you’re thinking about these things, obviously price is the first thing everybody’s gonna ask, you whether it’s price per point or per hotel or traveled, mile traveled, I don’t know. But there’s a lot more to consider in that, not just inventory, there’s a lot of other things going on. So tell me a little bit about that.
Nowell Outlaw (06:30.257)
Yeah, I mean, I think I get this question once a week, right? Which is like, show me your rates compared to these other guys, right? We, you know, and what it really is, is, you know, I’m looking over here at, you know, brand name, retail, are your rates really better? Right? And you have to understand, like, there’s a massive ecosystem of hotel inventory and rates, right? Across
Brandon Giella (06:37.131)
Yeah, yeah, yeah.
Nowell Outlaw (06:55.569)
all kinds of suppliers and different things. And different ones could cut basically different brands, do deals with different inventory suppliers. The price is a piece of it, right? Especially if you have a loyalty brand that you’re trying to maintain. know, consumers shop for leisure travel specifically, not commercial work travel. And there’s two main drivers. One is the price and one is points, right?
consumers will be loyal to their points. You see that with the financial services companies. see that with, you know, if you have the Voyager card, you have the American Express card, right? You use those points predominantly for travel and a lot of those cards. And so people are very loyal to that. The, you know, the other way is if you don’t have points, people are just shopping on price and it becomes that discount price, discount price, discount price. The problem that you get
is if you go with the cheapest price, and it is possible to find rates that you’ll be blown away by, the cheapest price might not be the best experience for the actual consumer when they actually have the experience. So they show up to the hotel and they go, yeah, you got the room with no windows that actually doubles as a closet for us. And it doesn’t have a bathroom. You got to walk down the hall and you’re like, wait a minute.
Like this is my vacation. And so there are a lot of instances of people, and we see it where they’ve selected another vendor. have opportunity right now. They’re on their third vendor or they’re looking for their third vendor. They started with vendor one, didn’t really work out. Now they’re on vendor two, they’re not very happy. And now they’re finally looking to platform like Switchfly because I think they started to do single threaded solutions.
they can do hotels first and then they’ll try to do these other things. And price is just a piece of it. And I think when you think about the consumer experience, the other piece that no one pays attention to and they really should, mean, not that they don’t pay attention to it, but it’s not the driver is the conversation about service. And that is, if you’re a brand, so we switch fly power,
Nowell Outlaw (09:20.679)
and work with American Express on a regular basis. They are a marquee brand. They’re a great customer. They pay attention to their customers. Like that is, you know, if you’re calling in, you’re having, you know, a great service experience because it is American Express, right? And they’re known for that and that’s awesome. There are other solutions out there when you’re not in that experience where it’s not as good, right? Or, you know, people are not confirming their bookings.
Brandon Giella (09:45.658)
Mm -hmm.
Nowell Outlaw (09:49.555)
they’re delayed, the booking’s actually not going through. And there’s all these things in the background that no one understands about even though you go into a site and you hit click and you get a booking confirmation, there’s this whole process behind the scenes of where that goes to actually get to the hotel. And what people don’t know about is when something happens, like you want to change something, the number
conversation and connects that have to happen to make that actually happen for you. And when that chain of events breaks down because the guy in the middle doesn’t believe in quality or doesn’t believe in good customer service, you have a huge massive problem because the consumer is going to get frustrated, right? The hotel is going to get frustrated as an example, and you have a disconnect in the middle.
Brandon Giella (10:44.695)
I can 100 % verify what you just said. Cause I, back in April, so I’m a American express platinum card holder. So back in April, wanted to go to London. We booked tickets, uh, and got two hotels there. They’re luxury hotels, but because of the, this was even a price thing. I mean, cause I was shopping on, you know, a bunch of different platforms and looking at price and all of that, but it was just a component. Cause when I was on American express travel, uh, they’re, they’re the portal.
it pulled up all these benefits that came with shopping on that portal. And then it also had that customer, you know, experience component. got like $200 off breakfast, you know, because it was part of this collection and all that kind of stuff. And then I went to the American Express lounge, which was wonderful. It was just a great experience. So yeah, I can totally testify. It’s a huge, huge component when you’re traveling.
Nowell Outlaw (11:22.921)
Yeah. Yep. Yep.
Nowell Outlaw (11:32.733)
Yeah. And it’s, you know, what we see is in other loyalty programs, right? Have they thought it all the way through, right? So they may be just looking for the tech platform and someone said, you know, we’ve got to get the best price, but you really got to think through the rest of the food chain, right? To really understand what you’re getting. You know, do you have the inventory on a global scale that you need? Maybe you don’t need that, but you know, those things. Do you have, you
Brandon Giella (11:41.321)
Mm -hmm.
Nowell Outlaw (12:00.987)
is the the site in the currency that of your consumers, right? So a lot of people, it’s all in dollars. Well, that that is good until you’re trying to service Australia. And then it’s, you know, it’s an Australian dollars or it’s in, you know, Mexican Pesa. Like, there’s simple things like that, that you see people getting, you know, kind of in trouble with because consumers will get really frustrated with why is everything in US
right in the presentation of it why can’t it be in my natural currency and then what happens is they buy something they see the conversion on their credit card and then they’re calling in to to basically they didn’t understand the price they didn’t understand this they didn’t understand but simple things like that create drama for the customer where there doesn’t need to be any drama
Brandon Giella (12:37.971)
Hmm.
Brandon Giella (12:50.664)
Yeah, a hundred percent. So something that is a maybe a little tack on to this conversation, but really briefly, what I’m understanding is if you have this, this large kind of aggregator network, this large inventory, you can also do a lot more sophisticated things like bringing in AI or ML into the process and creating some kind of personalization and localization. Like even to your point, like maybe doing the currency conversion and things like that. So is there things like that,
You get an advantage of basically having a lot larger inventory a lot bigger network like AI
Nowell Outlaw (13:26.463)
For sure, for sure. mean, AI is all about data, right? And training data models and doing things that you need to do. We have AI that monitors for prices, right? For consumers automatically, right? The benefit of having different channels for getting access to different inventories is you can see when things are moving up and down for the consumer, right? Automatically. People don’t even know that this is happening.
you know, the benefit is this gets applied automatically for the consumer across a diverse inventory, right? Across room types, regions, locations. Now, if you don’t think that, you know, the main OTAs, they also do this, right? And so if you’re sticking with a single threaded supplier, you only get what they’re doing, right? But I will tell you, like, because I’ve seen it, you can take the same room,
a king size, one bed with a swimming pool out the back kind of room. And you can look across different suppliers and go, well, that one is $250 a night less. And it’s just because of the way the deals work. And so being able to offer that to your consumers as a loyalty program, it’s not cheaper necessarily. It’s just a better value for your customer.
is also super critical and AI and ML applied over that kind of thing makes a lot of sense.
Brandon Giella (15:01.836)
I don’t know if you would agree with this, it sounds like having that kind of, yeah, sophisticated platform. You’re actually kind of uniting the price to experience trade -off maybe sometimes. You you actually are getting better value, but you’re actually providing a better experience by doing so, which can be really cool.
Nowell Outlaw (15:13.631)
Correct.
Nowell Outlaw (15:18.963)
Yeah, yeah. mean, we automatically, have, I came up with the phrase where we have a hotel content delivery network, right? So hotels just in themselves are very complicated, right? With the descriptors and the images and the star ratings and things like that. In our system, we automatically scrub out one -star properties and potentially two -star properties. And so you’re only getting certain things. We do have customers
it’s only four and five star properties that you’re seeing, right? And the interesting thing becomes, well, if you’re aggregating across different things and each one is the hotel’s rating themselves about I’m a four star or I’m a five star, the consumer doesn’t necessarily trust that. What you need is an independent star rating system. Well, guess what? Our hotel content delivery network, right? We actually built into that. We access some of the best rating systems automatically.
Brandon Giella (15:50.829)
Mm -hmm.
Brandon Giella (16:03.318)
Mm -hmm.
Nowell Outlaw (16:17.161)
to basically make sure that when you’re looking at a three star, a four star, a five star, you are getting a five star hotel, right? Yeah, it’s
Brandon Giella (16:24.691)
Amazing. No, thank you. What I love about talking to you is I feel like I’m on the cutting edge of like the travel loyalty rewards market. mean, not only like
What you guys are doing on a like you said the hotel network, but also the technology That’s all involved with that and and even the delivery talking about go and the pro offerings that you guys have so Anyway, super cool. Thank you, Noel. I know this is kind of a quick hit conversation But I’m so grateful for your time and excited for next episode All right, you too. See you
Nowell Outlaw (16:51.007)
That’s
Nowell Outlaw (16:54.813)
Alright, thanks. Have a good day. Yeah, bye.
