The coronavirus pandemic has forever transformed the strategies brands communicate with their audiences and customers across the globe. COVID has impacted businesses across all industries, but those under the hospitality and travel industries bore the brunt of the pandemic.
According to the United States Travel Association, travel spending went down by roughly 42% during the first year of the pandemic, causing losses of roughly $500 billion. Hotels across the globe saw a steep decline in occupancy, with some even declaring foreclosure due to the effects of the pandemic. Many immediately had to scramble to adapt to the new normal for their businesses to survive, trying out new strategies and plans to strengthen their businesses.
One effective strategy that can help brands transform the way they do business this 2022 is by adopting a subscription-based travel and consumer model. With that, here are three ways such models can supercharge brand performance.
Accurately Predict Brand Revenue
Subscription-based travel consumer models work at a fixed price. Customers are well-aware of how much they have to spend each month when they subscribe to a brand to get their product or service. Brands, on the other hand, can predict how much revenue they would make in a given month. Businesses can calculate their monthly revenue based on their offered subscription tiers and the number of subscribers they have.
A subscription-based consumer model better assures financial stability for a business. By accurately predicting brand revenue, brands can make better business decisions, while organization leaders can focus on other areas of their business. Businesses also have a better idea of how much they can reinvest into the business and strategize accordingly.
Consistently Provide Customers with Value
Today’s consumers are all about value. They want to connect and patronize brands that consistently offer value to them and make them feel like they are valued. Subscription-based consumer models, by nature, are designed to provide customers with consistent value over a period of time.
Because of this, subscription-based travel consumer models help significantly enhance the customer experience. This also strengthens the relationship between the brand and its customers, which makes it more likely to go long-term. If a customer is able to see the value a brand provides to them, they are more likely to continually purchase from and support that brand.
Provide Customers with More Affordable Options
Consumer-based subscription models typically offer different tiers, and businesses can charge their customers on a weekly, monthly, or annual basis. This allows consumers to choose the type of service they would want to purchase and control how much they spend for it. Standard business models often charge higher because purchases to their brand tend to be one-off, which means they would look for ways to maximize their profits. This can deter new customers from purchasing from them.
It’s often less expensive and more flexible in which customers would be more drawn to purchase from brands that use such models because they view them as valuable and affordable. Additionally, consumers are more likely to continually engage with brands that they do not have to pay large amounts to.
Businesses, particularly those in the travel and hospitality industries, should strongly consider adopting a subscription-based consumer model. This can ensure regular income for a business as well as secure its longevity.
Kaloyan Valentinov Danchev’s latest book, “My Gift to The World”, discusses 24 key inventions and ideas that are meant to combat some of the world’s most pressing issues. Danchev is the founder and president of a luxury travel firm, Fidelis Marketing Group.
