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“What is your flexibility worth?”
That’s the question being asked by Upside, a new travel company aiming to revolutionize the way business travel is booked.
As we all know, airline and hotel loyalty programs incentivize individuals to make choices that primarily benefit the travel provider (and if you’re a savvy One Mile at a Time reader, the traveler). This is reflected in the move to a revenue-based system by all the major airlines in the US domestic market. If you pay a higher fare, you’ll earn more miles. If you shop around for a cheaper hotel room, or a less-convenient flight schedule your employer might save money, but you earn fewer miles.
So the question becomes: if business travelers can be incentivized by loyalty programs, could they instead be incentivized to make choices that save their company money?
Essentially, what Upside is hoping to do is nudge travelers towards choices that also save their employers money. By offering gift cards as an incentive, Upside thinks business travelers might be more open to considering a connecting flight, or a hotel across the street. Options which ultimately save employers money too.
It’s an interesting idea, and we’re always looking for unique ways to save or improve the travel experience, so when Upside asked if we would be a launch partner we agreed. You guys will also have early access to the app, and will earn extra gift card credit on trips booked through Upside this year.
How does Upside work?
At the most basic level, Upside works like every other travel platform — you put in your cities, your dates, your general travel preferences — and you get some results with prices.
Where Upside differs, however, is that rather than leaving you to click around the various options until you find the best price, Upside handles the legwork. When there is an option that might be a little less expensive (and maybe a little less obvious or convenient), Upside will offer you an incentive to book it. Maybe $50, maybe $150, maybe somewhere in-between. It depends on the trip. The credits you earn will be redeemable for gift cards at a variety of retailers (Amazon will be one of them).
Say you’re taking a trip to Los Angeles, and have chosen to be in the downtown core. Upside will present a travel package, and then let you decide where or if you have flexibility, and what that flexibility is worth.
So you might be willing to stay a few blocks away in exchange for a $70 gift card:
But might be less interested in flying in to Long Beach for $20:
There are a couple of things to note:
- Upside Packages are only sold as a combination of round-trip airfare and a hotel stay
- You’ll be given a total cost for your package, along with the amount you’ll earn in gift cards, but you won’t get a breakdown of how much the flights or hotels cost individually while you’re shopping (though you could go look them up separately)
This isn’t a completely opaque process though. You still enter your preferred providers, and you can see your complete itinerary prior to purchasing your package. You won’t be surprised by a “Mystery Four Star” that’s just barely in the zip code. Upside understands that’s a non-starter for business travel, and is promising to share full flight details as well.
If you change your mind, you can go back and edit the options, which will generate new prices and gift card amounts. Once you’ve booked, you will get a breakdown with a snapshot of average prices for the day that you can use for your expense report.
The technology behind this is pretty cool (if it works, more on that later). Being able to get gift card credit for a variety of retailers — it doesn’t have to be travel — will definitely get people’s attention, and having the ability to know exactly what you’re booking will be key for business travel.
Beyond that, OMAAT readers can get VIP Access to Upside, which will guarantee you at least $150 in gift cards for every trip purchased through the rest of 2016 (more on that later too). The signup process is simple. You’ll enter a few details, answer some questions about your travel, and are good to go.
Is there a cost to Upside?
A small one, just $35 per trip. Upside negotiates rates with travel providers, so their hope is that they can steer travelers towards discounted inventory, and pass some of those savings through to the traveler, and ultimately to employers. They are estimating that companies will reduce travel costs by 5% to 15% if employees book through Upside.
So Upside will make some of their money along the way, but the service fee goes towards covering the cost of 24/7 live support. This should translate into better support during IRROPS or other travel disruptions.
But I want to earn miles!
Oh, I do too. Upside might be buying discounted fares from the airlines, but they’re not going after consolidator fares. You’ll still earn miles on your ticket (though your ticket might be less expensive, and thus earn fewer miles in a revenue-based system).
You won’t earn hotel points in most cases though. That’s because hotels typically only offer points and elite benefits when you book directly with the brand. Upside will count as a 3rd-party booking, so don’t count on getting those perks.
Who should consider Upside?
Upside is theoretically a great option for all small business travelers, but there are a few groups it seems particularly well-suited to.
The hotel agnostic
Unless you are traveling enough to achieve top-tier elite status in a given hotel chain, you may be better off booking through Upside anyway. I would have a hard time giving up my SPG Platinum or Hyatt Diamond perks, but if I wasn’t reaching those status levels I don’t know that I would be as motivated to stay loyal to the brands.
According to Upside:
“On a typical domestic business trip, travelers who buy an Upside Package from us can expect to get $100 to $200 in free Gift Cards to spend at their choice of stores. International travelers typically get twice as much.”
While I have had some amazing hotel breakfasts, they have limited marginal utility. At some point I’m just as happy with a Starbucks, and I expect that for many of you that point is somewhere between $100 to $200 in free Gift Cards.
If you’re reading OMAAT I assume you’re decently savvy when it comes to travel, but experience tells me your coworkers probably aren’t.
While it would be great to have everyone on board with earning the right miles and points for their travel aspirations, some people just aren’t interested. They’d rather book their travel a la carte, or just don’t feel like they travel “enough” to worry about maximizing.
Setting these folks up with a tool like Upside could be a win-win. Not only will they have access to travel support (something that a small business can’t really provide, and a less-savvy traveler doesn’t know they need until it’s too late), but they’ll get some help in finding an option that saves the company money as well.
Besides, if everyone plays in this space a good fare to Asia can just destroy your office schedule (not like that has ever happened around here 😉 ).
Upside seems ideal for those who may only travel a few times a year, mainly hitting the main industry conferences or that one client presentation.
If this is you, odds are you likely don’t travel enough to take true advantage of the native loyalty programs. While you could potentially defray some of the costs of baggage and WiFi by having the right credit cards, in most cases less-frequent travelers will plan on expensing those items. In many cases there isn’t a travel department booking these trips, and you may be on your own to find the most reasonable option.
Rather than hunting on Priceline or Expedia for a good deal, you can enter your trip parameters into Upside and get instant feedback on your travel choices. A little bit of flexibility could be worth quite a bit!
Who shouldn’t use Upside?
While I think Upside has the potential to make waves in the travel space, there are a few situations where Upside might not make the most sense.
Upside is great for business travel, in part because there are more parameters on the trip. We all make tradeoffs when we travel, but these often have a direct cost for business travelers.
Leisure travelers are inherently more flexible. You may want to book one leg of your trip with Avios, or book a hotel using a cash+points option. Leveraging miles and points can save a tremendous amount of money, but most business travelers aren’t going to subsidize their business travel with personal points.
With Upside, travelers are booking roundtrip flights and hotels. Again, this makes sense for business travel, but leisure travelers will probably find a better overall value by mixing and matching paid and award travel.
Extreme road warriors
Are you spending 200+ nights a year in suburban hotels as part of your typical “out Monday back Thursday” work routine? I’ve been there, and I get it.
Your company would almost certainly save money if you leveraged the flexibility incentives Upside is offering, and the gift card credits you’d personally getting would be significant.
But that may not be worth it compared to the elite hotel benefits you’d be missing out on, or even the value of consistently staying at the same hotel each week. I’ve done my share of leaving gym shoes and makeup bags in the back office of a Hampton Inn over the weekend, so I appreciate how helpful routine can be in streamlining heavy business travel.
The monetary incentives may or may not be worth it for the super heavy travelers — I think the sweet spot for Upside is going to be those traveling 1x-2x per month (or less).
Those with highly-managed travel policies
If you work for a Fortune500 company you may have pre-negotiated contracts, a requirement to book through BCD, and so forth. Upside isn’t really geared for travelers at those companies.
Even if you don’t have specific contracts, some companies set maximum rates for hotels in a given city (or follow the GSA per diem guidelines). I generally feel this is a bit draconian for non-government firms. My husband’s company, for example, requires him to book hotels within the GSA allowance, but doesn’t negotiate hotel rates or make any attempts to ensure the GSA rate is reasonable and available for a given trip. It’s more than a slight hassle.
Regardless, because Upside gives a bundled rate when shopping for a package, and then a more detailed (but not exact) breakdown later on, there’s no way to be 100% positive that the hotel is a certain price. If this is a non-negotiable at your office, you’ll need to pass on Upside for now.
Early access for OMAAT readers
For a limited time, OMAAT readers can register for an exclusive VIP invite to Upside. You’ll get special perks like:
- Early access to Upside (the app will launch for VIP Invitees in mid-September)
- A guaranteed $150 minimum in free Gift Cards for every Upside Package purchased in 2016
- Some VIPs will be invited to take part in shaping Upside’s product by testing pre-release versions of the Upside BETA
- Opportunity to earn additional gift card credits by referring friends/coworkers once the app goes live (only VIPs will be able to do this at first, but not for a few months)
Upside won’t be available to the general public until later on, so if you want to try Upside when they launch, you’ll want to register right away.
On the flip side, there are only a limited number of VIP invites. If you don’t travel for business please consider saving the invite for someone who does.
I think this is a pretty exciting concept, and if it works it will be brilliant.
And that’s the only real catch at this point. The app is in beta, and will have a slow roll-out. Not only does this help ensure they’re able to meet the demand, but will give everyone a trial period to see if Upside can handle things like changes and cancellations in a reasonable way. It’s a smart strategy, so I respect the approach.
In the meantime, I do have some questions as to how this will work in practice, as I’m a natural skeptic. If Upside can help liquidate excess hotel inventory that will help them significantly, as planes are full and there aren’t as many opportunities for airfare arbitrage right now. If they can’t negotiate great rates, it’s going to be tough to make the program both rewarding and profitable.
But in general, and if Upside can deliver both the traveler incentives and the employer savings, I think this could be a game-changer.
What do you think? Would Upside make sense for your business travel?