Change Take
— Dennis Scale
Expedia Group and Mastercard are teaming up to launch a loyalty points redemption program that allows banks and credit unions that issue Mastercards to enable their cardholders to redeem credit card loyalty points after booking travel , provided by Expedia.
Mastercard has partnerships with multiple co-branded card issuers, including Chase Card Services, Citi Retail Services and Capital One, for example, that could potentially benefit from Mastercard-Expedia Group loyalty services, although some of these Mastercard partners already use competing travel suppliers.
Hopper, for example, is the ride-hailing provider for Capital One Travel.
The Mastercard-Expedia Group partnership has Expedia providing a booking template it calls its white label template technology, and Mastercard stepping in with its digital redemption solution.
The partnership means travelers who have co-branded Mastercards from participating banks can redeem Mastercard points when they book their travel.
Expedia Group made the announcement Tuesday at its Explore 23: Connect partner conference, which for the first time moved from its traditional location in Las Vegas to Expedia Group headquarters in Seattle. Expedia Group moved into the building in 2019, a few months before the pandemic began.
The Mastercard partnership was one of a series of announcements by Expedia touting its business-to-business segment, which reported a 55 percent year-over-year revenue increase in the first quarter to $668 million.
Expedia’s business segment, which includes partnerships with major banks, airlines and hotel chains such as Marriott, IHG, Hilton and Accor, is a key part of Expedia’s growth strategy. Business-to-business revenue accounted for 25 percent of Expedia’s total revenue in the first quarter.
Expedia said more than 400 million people connected to the loyalty programs of major banks, airlines and hotels benefit from the company’s white label template and API solutions that provide connection with partners.
“Demand for this business continues to be strong, as evidenced by our new partnerships with Mastercard, SoFi and some of our largest partners,” Expedia Group CEO Peter Kern said in a statement.
He said the company’s business segment is poised to grow further “as we continue to establish our technology as a core operating system for the travel industry.”
Rivals such as Booking Holdings and Hopper may have something to say about such expected dominance, as they have struck many similar business-to-business deals.
Ariane Gorin, the company’s president of Expedia for Business, said in the release that Expedia’s technology assets, which include artificial intelligence and machine learning, have “grown phenomenally” over the past 10 years as the company enables travel both online offline partners.
Referring to the $2 trillion travel industry, Gorin said there is plenty of room for Expedia to grow that part of its affiliate business.
There is also plenty of competition, although Expedia Group’s business-to-business segment is considered the largest in the travel industry. Reflecting the competitive nature of the business, Expedia feeds part of Chase Travel, but loses the flight component of that business. Both Booking Holdings and Hopper are forming new partnerships.
More loyalty and services
Elsewhere in Expedia’s announcement, the company said it plans to debut a guest experience score in collaboration with hotel partners in the second half of 2023.
As Expedia prepares to launch its consolidated One Key loyalty program in the US on July 6, the company said it will add member-only deals on flights to its existing list of such discounts on hotels, cruises and activities.
In an update, Expedia said its previously announced microservices offering for partners, called Travel OS, “has now reached commercial status” in the area of fraud protection. Additional parts of Travel OS, namely “service technologies and revenue management APIs,” are already being tested with partners.
Expedia also has a technical “optimized distribution” program that helps partners, including Marriott and IHG, police rogue rates that aren’t meant to be widely available to the public on a stand-alone basis. Many of these prices are assumed to be part of holiday packages and therefore the hotel price is not disclosed.
Expedia said it has tripled the number of hotel partners using its optimized distribution solution over the past two years and will roll out new rate management technology as part of the program later this year.
About 35,000 U.S. travel agencies in more than 30 countries already participate in Expedia’s Travel Agent Partner Program, the company said. The program includes live agent chat to help travel agents get answers to questions.
Expedia said that in the first quarter, 32 percent of all travel agent interactions with the company in the US went through this Live Agent chat.
Photo: Expedia Group Announces Loyalty and Technology Distribution Agreement with Mastercard.