United Airlines established a new corporate discount program for midmarket companies that can earn those demonstrating an ability to shift share upwards of 19 percent off premium fares.
Called United Propel, the program differs from other airline midmarket discount schemes in that it includes $2,000 to $10,000 in annual amenities and also will apply (as early as fourth quarter) to travel with joint-venture partners, according to United VP of Americas sales Jake Cefolia.
“We’re enthusiastic about the middle market,” Cefolia said. “Our existing initiatives have emboldened us.” Those include a recently refreshed PerksPlus business points program and the PassPlus prepaid program.
“This is aimed at companies just getting their arms around managing travel, sometimes startups and sometimes mature companies just realizing they need to pay attention,” said Cefolia. “It’s an easy-to-implement product with significant benefit from day one.”
Discount levels depend on total travel spend and the client’s performance relative to fair market share. Participation in Propel requires clients to have their travel management companies send data to Sabre’s Prism airline contracting and data system. That’s something users of United’s basic CPA discount program, which offers 2 percent off, are not required to do.
“Discounts range up or down in the future depending on business clients shift to us,” said Cefolia. The “starter” level is 2 percent to 6 percent.
Clients would manage the amenity fund using United’s Jetstream client portal. The funds could be used for upgrades, club passes or other perks. Like discount levels, allocated fund amounts would depend on the premium that clients are delivering over fair market share.
Generally, Propel is styled for companies spending more than $1 million on air travel, with at least $250,000 on United or its partners.
Cefolia sees it as an opportunity that could cause companies to bolster their efforts to manage travel. “A company may say they’re willing to invest in more policy, control, systems, etc.,” he said. “Hopefully it’s a catalyst for companies that are on the verge of putting resources in and making the leap. If not, that’s fine but we’re hoping that knowing you can ‘range up’ will be motivating to customers.”
The program has no impact on United’s commission arrangements with TMCs, Cefolia said.