Travelstart is offering MasterCard holders exclusive deals on local and international flights, hotel accommodation and other value-added services as part of a new partnership with the financial services brand. This applies to cardholders in South Africa, Nigeria and Kenya.
Despite MasterCard’s extensive reach and potential to reach new customers, other retail brands have downplayed the ripple effect of the presence of another competitive travel rewards partnership in the local market.
Currently, the Travelstart-MasterCard agreement means discounts of 10%-30% on a selection of airline and hotel inventory.
Some of the suppliers feature on a special landing page on Travelstart’s website include FlyNamibia, TAAG Angola Airlines, Ethiopian Airlines, Qatar Airways and LIFT. Members can save 10% on hotel bookings in destinations such as South Africa, Botswana, Namibia and Mozambique.
“The focus is on providing sustainable discounts to customers who are under pressure because of rising air travel costs,” said MasterCard. Securing availability for cardholders is not a priority for now, said Travelstart, however it added that this was still a possibility.
“As demand for travel goes up, unfortunately prices follow and we are happy to offer MasterCard holders real savings through our partnership,” said Stephan Ekbergh, Travelstart founder.
Travelstart’s deals are available to any Gold, Platinum, World and World Elite MasterCard cardholders as well as debit, credit, prepaid and commercial cardholders, the retailer confirmed.
Retailers expect more ‘co-opetition’
Travel News asked some retail leaders how they felt about competing against the financial brand and the impact this type of member perks programme has on the market.
Franz von Wielligh, Head of Innovation & Member Relations at XL Travel, said, “It is no secret that some major banks, insurance companies, credit card providers and a few non-travel retail brands are offering their clients some sort of travel discount and/or reward. It is nothing new in the market. It is important to note that not all travellers are clients of these institutions, and that not all clients are necessarily making use of these services.”
In the case of Travelstart and MasterCard, Von Wielligh noted that the basket of exclusive deals and list of suppliers represented was limited and that there would be an annual usage cap.
He conceded that discount and reward partnerships involve massive captive audiences and might be perceived as a threat to both legacy travel providers and ITCs. However, he said: “I do believe that the TMC has reach to other markets which are not easily accessible nor manageable by these players. In my view there is a massive difference between price and value, and this is the biggest difference between the TMC and non-TMC travel providers.”
Travelstart confirmed that there were more partnerships in the pipeline. “Travelstart is also partnering with MasterCard-affiliated banks across Africa to create unique offers for customers on a market level,” the brand said.
Jonathan Gerber, Travel Assignment Group Director, said this type of competition was becoming more common and he too expected more closed user groups in the future. “Agents are already competing with Discovery Bank, Travel by Investec, and the various rewards programmes, so, essentially, this is nothing new. ‘Co-opetition’ is becoming a real thing!
“The question is: Are the discounts valid? What is the service that goes with it? It’s a value-add but at what reputational risk to the bank?”
Speaking about the impact on the retail travel market, Gerber said: “It all depends on the discounts and service offered. Someone is paying for the discount – the bank, the supplier, the agent or the client. Why would it be unfair? It is a big, bad competitive world out there. Eat or be eaten! These will become far more common. But beware – they are not as clean, simple and effective as they all claim to be.”
Gerber said competition in any market came with opportunity. “It gets you to think. What I can tell you, however, is that we have taken over many disenchanted customers who have had their fingers burned on what seem to be marketing strategies rather than effective, sustainable travel philosophies. Nobody wants a race to the bottom.”
