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TRENDSPOTTING

A new way to travel: by subscription

Advances in technology are opening the door to new ways of providing flights, hotels, and other services through memberships

Some new all-you-can-fly subscription programs also have emerged at the high end, including Surf Air, which offers memberships for seats on private planes for from $1,950 a month.
Some new all-you-can-fly subscription programs also have emerged at the high end, including Surf Air, which offers memberships for seats on private planes for from $1,950 a month.Chad Slattery

Puerto Vallarta and chill.

That’s the proposition behind a small but growing number of companies offering a new way to buy travel: by subscription, just as consumers do with streaming services like Netflix.

As subscriptions become ubiquitous for everything from TV shows and movies to meal ingredients to shaving supplies, new subscriptions are being offered for air travel, flight deals, seat upgrades, hotels, rideshares — even admission to national parks.

“If you think about convenience, it is appealing, especially to millennials and Gen-Zers who have other types of subscriptions in other parts of their lives,” said Caroline Bremmer, head of travel at Euromonitor International, which tracks travel trends and considers this one on the upswing.

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It’s been slow going so far. Travel companies are cautious about the subscription model, which they’ve tried before with poor results. JetBlue’s “All-You-Can-Jet” pass, for example, didn’t last long after it was introduced in 2009. Neither did OneGo, which in 2016 promised unlimited fights on almost any airline for a monthly fee, or Beacon, an all-you-can-fly subscription service between Boston and Westchester County Airport in New York.

Now, however, advances in technology are opening the door to new ways of providing flights, hotels, and other travel services through memberships. “The Netflix-ization of travel,” said Daniel Levine, director of the Avant-Guide Institute consulting firm, is entering “the testing phase.”

As in any experimentation period, there are limitations to the programs being launched and in many cases high costs of entry. “Innovation usually starts on the high end before trickling down to the hoi polloi,” Levine said.

The Inspirato Pass, for instance, a subscription to luxury hotels, resorts, and vacation homes in 200 destinations, costs $2,500 a month, though subscribers pay no other room fees, service charges, or taxes. They’re buying access to rooms that would otherwise have gone unsold, since the brands at this rarefied altitude — Mandarin Oriental, InterContinental, Ritz-Carlton — almost never stoop to publicly offering discounts.

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These hotels “are dying for a channel to be able to sell inventory without anybody knowing the price,” said Inspirato founder Brent Handler. “We provide them the ability to safely distribute their inventory, but without telling anybody what that price is.”

With its lush online catalog of indulgent destinations, the company “has probably inspired more aspirational daydreaming than any travel product since the round-the-world ticket,” as Levine put it. Daydreaming because, to benefit, consumers have to shell out what comes to $30,000 a year. Handler said that, since it debuted in July, the Inspirato Pass has attracted $10 million worth of annual revenue, which works out to a select 330 or so members. And even the 1 percent has to live within some rules; only one reservation can be booked at a time, and no closer than seven days in advance.

Some new all-you-can-fly subscription programs also have emerged at the high end, including Surf Air, which offers memberships for seats on private planes for from $1,950 a month. Now operating in California and Texas, it says it has plans to expand east. Airly, in Australia, also offers memberships, with a monthly fee plus the cost of flights, which it says still works out to being cheaper than the most expensive business fares.

But there are also a few upstart subscriptions that include not free flights but cheaper fares.

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For $49.99 per person, per year, FlyLine helps its members find domestic fares for what it says is up to 15 percent savings and international ones at up to 60 percent off by using a complex process called virtual interlining to combine the lowest-cost segments on more than 250 airlines worldwide whose routes don’t link up through the conventional code-share system. And the subscription fee forgoes the need for FlyLine to add a commission.

The company plans to eventually expand into hotels, tour packages, and rental cars, cofounder and CEO Adam Ward said.

“We’re definitely early on this,” Ward said. But “I see subscriptions becoming more of a thing in travel. The major carriers are starting to get into it.”

That’s because the subscription concept has made such obvious inroads into other industries. Half of consumers subscribe to a streaming service such as Netflix. Nearly 35 percent have two or more subscriptions.

The subscription e-commerce market has seen sales double in each of the last five years, the consulting firm McKinsey & Company reports. The biggest subscription-based retailers alone — Dollar Shave Club, Blue Apron, Stitch Fix and others — collectively generate nearly $3 billion a year in sales, McKinsey estimates. That has prompted legacy brands such as Proctor & Gamble, Walmart and Sephora to create their own membership plans.

For providers, “this is a fantastic way to smooth your revenue over time and have a guaranteed level of revenue coming in every month,” said Tim Derdenger, associate professor of marketing and strategy at Carnegie Mellon University’s Tepper School of Business.

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The airline Swiss in October rolled out Flightpass, which offers packages of 10 one-way flights per year to and from Geneva for from 549 Swiss francs, or $570. Etihad Airlines in February became the first international carrier to adopt TravelPass, a proprietary subscription program developed by a company in Norway. Memberships are designed for frequent and business flyers and cover a period of time or a specific number of flights; Etihad hasn’t yet announced the cost, and is promoting the subscription as being as much about convenience as savings.

Other travel companies are testing the waters. United, for example, sells annual subscriptions starting at $599 for access to Economy Plus seats, when they’re available, and also has subscription deals for bags and in-flight Wi-Fi.

Uber is piloting a $24.99-a-month subscription plan in San Francisco and Chicago that provides discounts on UberX and pooled rides, Uber Eats orders, and JUMP bikes and scooters. And the National Park Service sells an $80-a-year membership ($20 for people 62 and older) that covers admission and other costs in 2,000 national parks; for context, the entrance fee for a car to Acadia National Park is $30 and for a hiker is $15.

One big limitation is that people fly, stay at hotels, and go on vacation much less often than they eat, shave, or watch TV; the average person flies once every 22 months, according to the International Air Transport Association. That constrains the market for an annual subscription to an airline, for example.

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Still, trend-watcher Cognizant predicts that by 2025 consumers will subscribe to “mobility packages” combining flights, hotels, and other travel services.

“Trying to establish more of a frequent engagement and encourage repeat visits is something operators are very keen to do,” said Bremmer, at Euromonitor. And a subscription plan “is going to be a way of ensuring that you have repeat visitors.”

“The question,” she said, “is whether the appetite is there from consumers.”


Jon Marcus can be reached at jonmarcusboston@gmail.com.