Partnership Deal
JP Morgan Chase is teaming up with Expedia to introduce additional hotel and flight options on its Ultimate Rewards travel portal. The Chase Ultimate Rewards offers travel rewards to the bank’s credit card users online and also on the bank’s mobile app. Commencing on Sunday, its customers will be able to take advantage of the new upgrade. According to a source abreast of the details of the upgrade, Chase’s customers who go ahead to redeem rewards via the bank’s website portals will gain access to double the ordinary travel inventory as from Sunday.
In addition, the bank reportedly carried out updates on its mobile application and website to make the process of selecting flights as well as seat options easier for its customers. Further with the new updates, the customers will receive a more comprehensive analysis of fees. Also, they will be able to redeem travel by using combination of cash and their points. The customers will also have access to travel deals offered by Expedia and will be enabled to select any of the 250 airlines and 272,000 hotels.
This partnership can be rightly tagged as another indicator that traditional financial institutions are partnering with foremost software companies to keep satisfying the rapidly increasing consumers expectations. Expedia group is the proud parent company of websites such as Orbitz, Hotwire.com and Travelocity. J.P Morgan Chase, considered the biggest US bank based on assets size also has subsisting partnership with other tech firms such as Roostify and Truecar in a bid to improve the bank’s retail offerings. To gain more grounds with the ordinary customers, a foremost investment bank, Goldman Sachs also recently bought Clarity Money,
Details of Partnership Deal
Whenever users spend on JP Morgan’s credit card, they earn points and they can subsequently redeem the points via the travel portal. The customers are also able to use their points either for cash or for gift cards, but Chase encourages its customers to book travel so as to boost the value that accrues to the points redeemed whenever they do.
Sources indicate that those spenders tend to place more focus on sectors where they get to earn the highest points and so they focus more on sectors like travel or dining. The bank’s customers have reportedly been redeeming their rewards more rapidly than the bank expected. That allegedly caused the bank to take out a $330 million charge last quarter.
Beginning from Sunday, those who use JP Morgan’s Freedom and Freedom Unlimited cards will get access to the portal. Other credit card users, i.e. Ink and Sapphire cardholders will subsequently be incorporated in coming months. The cardholders will be able to access seasonal offers, discounts and also online cancellations.
Partnership Benefits For Chase
According to reports, the bank has a lot to benefit from the partnership with Expedia. One of such benefits is that it would serve as an encouragement for additional card sign-ups while also boosting volume.
Research has shown that rewards generally serve as a key influencer for adopting a particular card . Particularly, the travel rewards can increase engagements and boost the popularity of a card. More than half of the total respondents of a survey on consumers in the US indicated that the existence of rewards redemption that are flexible in nature or give them the freedom to choose the specific reward to redeem such as cash back, hotel discounts, airline travels among others, influences their decision in selecting a primary card.
As such, increasing its redemption options by adding to the travel options has a high probability of increasing the bank’s users or lead to an increase in customers’ spending to make the credit card their primary card.
Another benefit of the partnership is that it could provide the bank with the possibility of making popular rewards available to their customers in a cost effective manner. The bank recently reversed some of the rewards available on the Sapphire Reserve Cards because rewards can generally be expensive for the issuers. Partnership deals are thus deemed a better cost effective way to make firms still able to offer attractive rewards. The bank understands this and this isn’t its first partnership.
Reports have it that it recently partnered with Starbucks to launch a cobranded card and it also upgraded the current cobrand partnership it has with United Airlines. The partnership with Expedia has a way to also keep offering in-demand rewards to its customers and more cost-effective.
