The business travel industry has been considering how to adopt subscription models in light of the popularity of services like Netflix and Spotify. But, as with all innovation in this sector, it's taking some time to figure out how these integrate into current platforms or for someone to take the big leap and completely turn their business model around.
What would it take for subscription to work? Simon Talling-Smith, CEO of Surf Air Europe, which offers unlimited flights for a monthly fee, says the traditional mindset and controls set out by the likes of GDS don't work for subscription services. "Our content has no controls such as cost, because it's fixed," he explained at Business Travel Summit London. "Airlines work on optimising the best value per seat and flight…we don't have to optimise — we want to keep members for as long as possible and we do that with service and seat availability." He thinks airlines will struggle to adopt subscription services for seats.
So far the only subscription in traditional airlines I've found is United Airlines for Economy Plus and baggage. Subscriptions can be bought for an individual, pair or for everyone in your reservation (up to eight) and by region. The former means you can reserve an Economy Plus seat on any flight and with the latter travellers can check up to two bags per flight.
On the ground, Concur's Chris Baker believes that some areas could be simplified using a subscription model. "Train tickets and mileage are the most prolific line items so if there is an opportunity to get flat rate subscription that could be of interest to travel buyers," he said on stage with Talling-Smith. When it comes to car ownership and subscriptions, these are blossoming, with Wagonex claiming just last week to be the first in the UK.
What of TMCs? Fellow panellist Jason Geall of Amex GBT says there are some companies in the US using subscription models instead of fees. However this is difficult to replicate in the UK because of the way travel is procured and RFP processes.
Given both Baker and Geall's enthusiasm for Surf Air on stage it could be that we could soon see a shift towards the Netflix way of doing things. But when it comes to travel and subscription, Talling-Smith says travellers will expect more. "When you're a member of something, whether it's a gym or Soho House, you have a level of expectation and service."