It’s hard to put corporate travel startup Rocketrip in a
box. The real-time trip budgeting tool is banking on managed travel evolving into
an employee-centric environment. It’s a world in which corporations may have to
entice their employees to save money. Rocketrip offers a solution.
The technology lets clients scan available air, hotel and
car rental rates to return an estimate of how much a business trip should cost
before the traveler makes a booking. That’s Phase 1. Phase 2: The incentive
piece kicks in. If a traveler books the trip and beats the estimated budget, he
or she earns points based on the percent savings. Phase 3: Travelers redeem
points, choosing incentive items that matter for them. Golf clubs, check. Gift
cards, check. Flights, check. Rocketrip also has forged partnerships with Airbnb,
Expedia and a host of other travel providers.
This week, Rocketrip announced a partnership with Virgin
America that essentially gives the carrier preferred status within the tool. BTN editor-in-chief Elizabeth West caught
up with Rocketrip CEO Dan Ruch on the eve of the announcement.
Why does this partnership
with Virgin America matter?
The entire market is moving
to an employee-centric model. Mobile devices, the sharing economy … everything
is forcing travel management to think differently. We really thought the last
adopters would be traditional legacy vendors. For me, this [partnership]
signals that vendors are recognizing that what is in the best interest of the
business traveler is in the best interest of the vendor. It’s a signal that it’s
not just about getting a cost-insensitive traveler to spend more.
But doesn’t Virgin America
already have a more progressive outlook on customer-centricity than what we
typically think of as a legacy carrier?
They’ve always catered to a
more progressive audience in everything they do with their brand, pricing and
markets they service. [It’s] all done with the customer they want to service in
mind. It’s not United’s typical customer; it’s not Delta’s typical customer.
Virgin is the fun airline, and they’ve catered to that market. They’ve struck
their own partnerships with Airbnb and Uber. Partnering with Rocketrip is
playing into this market. They need to be where travelers are. Instead of
coercing companies to push traffic to them, they are meeting employees where
employees want to be.
Do you mean within
Rocketrip?
Effectively Virgin becomes Rocketrip’s preferred airline.
It’s definitely not a forced choice, so we promote and recommend Virgin America
but users are free to book however—and with whatever supplier—they want to
book. The benefit to Virgin America, though, is that they get a way to engage
with a growing network of business travelers who in many cases travel
frequently but don’t have hardened loyalties to one existing legacy carrier.
Effectively, they get a chance to win over a very high-value customer by
offering a better value proposition right at the point of booking. So they are
meeting users where they are and not forcing them into a funnel they don’t want
to be in.
That’s on the budget side. On the redemption side, [Rocketrip
is] a massive e-commerce biz where employees redeem [reward points] for value.
Along with Virgin America elite status, [various] gift cards, American Express
cash and Callaway golf clubs, etc., employees can now convert their Rocketrip points
into Virgin America’s Elevate [frequent-flyer] program. This is massive. It
effectively allows employees to convert their rewards from their corporate
travel program to personal travel.
That seems fine for your
customers operating in a fairly open environment but might not play well in
more tightly managed programs. Do you have clients like that?
With all our partner
agreements with all redemption providers, we reserve the right to remove them
from the platform for clients with a conflict of interest. If we are working
with a client who has a strong existing relationship with United, we would
simply remove the opportunity for employees to redeem any rewards or transfer
any points to Virgin America. That’s at the discretion of each client. We want
to meet employees where they are, but we also have to do that to the extent
that it is permissible by the client.
Do you see extending
relationships like this to other “legacy”-type vendors, as you describe them?
Our focus is to find and identify partners who believe what we believe: that an employee-centric model makes sense in this new world. We went to Virgin because of their work with Airbnb, Uber and others. We felt they would align. Most of the work we do in regard to partnerships on the vendor side is done based on analysis of customer behavior. We look at the data our clients provide to us in terms of where they’re booking travel today. We look to do preferred partnerships with vendors our users are engaged with organically. We saw a significant volume of travel going to Virgin. There was an opportunity for Virgin to capture a wide share of that wallet, but also their value aligns with our users’ interest. It’s the reason we engaged with Airbnb and the reason we are talking to some of the other hotel vendors now. It’s based on looking at where users are going organically and then making the process of booking more seamless by integrating the vendors into the platform.