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The benefits of package rates for travel businesses

Nov 13, 2019

Package travel is on the rise. According to Mintel the number of travelers opting to book travel, accommodation and add-ons from a single provider is expected to grow by from 2017 to 2022 after years of decline[1]. Why? Well, the biggest factors are undeniably cost and convenience.

That’s why for all travel companies there is huge potential in offering travelers package rates – bundled pricing that allows them to conveniently secure a great-value deal by booking more than one element of their holiday in one place.

For those providers that can offer the right supply of transport and accommodation options – and even extras such as activities or tours – this approach holds all sorts of benefits. 

It creates a one-stop shop

Travelers prize convenience when it comes to booking trips[2]. Even more so when companies can save them both time and money by creating special package rates that reward their loyalty in booking all the elements of their trip with a single provider. This is where dynamic packaging comes in. "Package" used to mean flight + hotel. But with dynamic pricing that allows travelers to build their own packages and attach different products as they book single items, a package can be flight + hotel + transfer, hotel + car rental, or any number of combinations.

In the digital age loyalty is hard to come by and even harder to keep. But by offering travelers real value in this way companies can build the foundations of repeat bookings – so long as supply matches demand. 

It can boost your hotel attach rate

By boosting the range and relevance of your travel products you can vastly improve attach rate. And while that's predominantly associated with hotel bookings, with dynamic packaging it can be the rate at which you attach all kinds of upsold and cross-sold products – hotel, car rental, insurance, transfers, and tours.

Dynamic package rates and targeted, flexible bundles are crucial in persuading travelers that they’re securing value by sticking with one company, and that doing so doesn’t mean sacrificing the elements of a holiday that are important to them.  

It creates incremental sales value

Offering additional travel products on one platform always creates an opportunity to cross-sell and boost the incremental sales value of a booking. But package rates improve the success rate of this cross-sell by offering travelers not only convenience but a cost saving, giving them a great deal while increasing transaction value. And it isn’t only about boosting the value in a single transaction. Delivering this value via package rates builds longer-term loyalty too, with customers enjoying a more rounded booking experience and more likely to return to a provider to book their next trip[3].

It lets you offer flexibility

Dynamic packaging, allowing travelers to build their own tailored product, is a far more contemporary and compelling product than the more static package holidays of a few decades ago. Travelers shouldn’t be limited to one approach, instead being offered the flexibility of rates for booking a flight and a car, a hotel plus an activity, or a flight followed by a rail journey.  

It’s a stackable proposition

In the future, package rates will keep expanding beyond bundled offers for travel and accommodation to more and more tailored options. The potential in this way is almost limitless. Not least as travel becomes ever more experiential, providers will need access to an ever-increasing array of add-ons, from different suppliers, using different integrations. The ability to offer flexible, expansive packages can help move the current fragmentation of the travel industry towards a truly seamless booking experience[4].

At EPS we allow travel providers to integrate package rates into their supply in a variety of ways to offer a truly flexible proposition. For more information on how EPS can help you maximize your revenue opportunities with package rates and cross-selling, find out about our products.

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