WHAT IS THE MEMBERSHIP ECONOMY?
The Membership Economy rocketed during the pandemic. From coffee to toilet paper, audiobooks and news to TV and music, and wine to recipe boxes. The shift from ownership to recurring payments is no longer reserved for Amazon Prime, Spotify, or Netflix. Infiltrating all aspects of consumer life, the recurring revenue model accelerated in lockdown and is set to shake up the travel industry too.
It is predicted that the global subscription e-commerce market will reach US$478bn by 2025. The Membership Economy is all about maximising trust and working to build long-term, formal relationships with customers. Thanks to human nature making us desire to ‘belong’, which in business translates to ‘being a member’, companies that embrace this model can enjoy more predictable and smooth cash flow while staying ahead of their competition. In today’s world, consumers demand products and services that are customised, flexible and offer a sense of ‘exclusivity’. The Membership Economy is giving them just that by pushing companies to prioritise their customers over their brand or products. This, as a result, increases the value of their offering.
Technology has enabled this consumer trust and ecommerce development.
HOW THE MEMBERSHIP ECONOMY MODEL WORKS
Bidroom is at the forefront of this revolution, pioneering as the first purely membership-based player in the travel industry. Michael Ros, Founder and CEO of Bidroom, the marketplace where hotels do not pay a commission, said “When faced with a crisis, subscription companies have demonstrated resilience. The Membership Economy will be key for tourism revival”.
Ros launched Bidroom in 2016 so that travellers can enjoy better savings. The saving is therefore shared between the hotel and the traveller, providing a better deal for all. This is key for Bidroom as it means focusing on building value for travellers. It does this by delivering greater value for hotels, not just offering better savings on bookings compared to other online travel platforms but through offering complimentary hotel extras in an easy and transparent way.
“Being a part of the Membership Economy enables Bidroom to serve travellers in a whole new way, helping to increase the value of their travel experience. For Bidroom it means focusing on building significance for travellers by aiming to deliver greater value from hotels, and our partners”, Ros says.
WHAT IS THE FUTURE OF THE MEMBERSHIP ECONOMY?
Deloitte Insights (Digital media trends survey 14th edition – 2020) highlighted that men have more subscriptions than women, 14 compared to 10 for females.However, men are more prone to cancelling subscriptions meaning that travel brands looking to enter this space need to work on sustaining commitment amongst men and getting more women to commit to the initial subscription.
Ros concludes that, “Organisations that continue to evolve the products that they offer while increasing the value they provide, are going to be the winners of the Membership Economy”, and with Bidroom pioneering as the first pure “membership based” player in travel industry, they are the forefront of this revolution.