LATAM Sells Flight Certificates That Accrue Value Via Plusgrade Portal
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Plusgrade’s Travel Again program allows airlines to sell certificates that will be worth more when customers book flights at a future date. The airline can determine how the credit increases in value over time, but Plusgrade recommends that airlines make the certificates most valuable soon after purchase, to accelerate the recovery of the commercial aviation industry.
Starting today, LATAM Airlines customers can purchase flight certificates that increase in value over time. The initiative is made possible by APEX member Plusgrade, known for its upgrade bidding product and other ancillary revenue-generating solutions, and travel technology company Amadeus.
Plusgrade is offering the Travel Again program to airlines and other travel companies free of charge, and will not keep any portion of the certificate price. “Our goal is simple: move rapidly to provide valuable tools to accelerate our partners’ recovery, counter the cash impacts they are experiencing, and give the community of global travelers something to remind them we are all connected and inspire them to travel again – sooner,” said Ken Harris, founder and CEO of Plusgrade.
Airlines that wish to offer this option to their customers can determine the rate of increase in value of the certificates, as well as the expiration date. Customers then choose their desired amount via a custom-branded web portal and receive an email confirmation after completing the payment process.
“Our goal is simple: move rapidly to counter the cash impacts that our partners are experiencing.” – Ken Harris, Plusgrade CEO
“The pre-paid certificate grows in value by way of a bonus percentage amount that accrues each month,” explained Pramod Jain, chief operating officer of Plusgrade. “For instance, if 5% is the monthly bonus amount and a certificate is purchased for $100, the certificate has a value of $115 at the end of 3 months. A total cap of the number of months is also configurable, so for example after 12 months the certificate would be worth $160 and no longer accrue any additional value.”
Plusgrade is encouraging participating airlines to make the certificate most valuable shortly after purchase, in order to speed up the recovery of the aviation industry once non-essential travel is deemed safe. For example, a $500 flight certificate purchased today would be worth $1000 later this year, or $750 next year.
When the customer is ready to book a flight, they would do so using the same portal where they purchased the certificate. “Redemption occurs using industry standard redemption processes already existing to the airline,” Jain said. “There is no customization needed, so airlines can implement the program quickly.”
Plusgrade’s Travel Again program creates a win-win scenario for airlines and prospective travelers, according to Dr. Joe Leader, APEX/IFSA CEO. “The program helps our airlines worldwide receive revenue today. It helps airline passengers that see their travel certificate investment grow quickly.”