Our target customers are Millennials in India. Avg. annual income of a millennial (software engineer) in India is Rs. 6 lac (i.e 10,000 USD). And we are offering them budget vacations under Rs. 30K (i.e 500 USD). So, there is room for repeat purchases. We are a startup with a nominal funding of 500K USD, tight on cash. Wondering how we can run a loyalty/rewards program to start growing our customer base?

Hello Team,

Firstly, the holiday/vacation travel space, especially the budgeted segments are becoming more sought after, not only by the category of individuals that you've listed out, but they're being sought out by college students, individuals, couples, honeymooners and the like.

You could offer a points system, where they receive a certain number of points, depending on the amount they spend, which can be redeemed after reaching a certain amount (ex. A makes payment for a trip through you worth rupees 30K and they can receive 1000 points) (Again this amount is for your team to finalize and figure out depending on how much you're willing to cut into your margins). Once a customer makes 2000-3000 points, they can redeem the amount on their next trip purchase, the points redeemed will basically be a deduction of a certain amount of the total fee, eg. 2000 points = 500-1000 rupees, so they get a discount of 1000 rupees on their total purchase.

While this is not a bad way to start, without having to burn cash out-of-pocket, it might be a slow way to build your customer base.

The other alternative, and I say this from personal experience, is providing a valuable customer experience, be it priority check-in at hotels, spas or the airport or just the ability to check into a hotel room at any time and not follow the 12-12 (24 hour check out) system. Tying up with hotels and the like will help you establish yourself as a strong player in the market because of the positive reviews your existing customers will give you.

You could also offer un-married couples the ability to check-into hotel rooms without hassle in the lower segment hotels, which would incentivise them to repeatedly choose your services.

You could also offer people a referral reward.

Tying up with alcohol vendors on vacations, so that customers can pick up liquor at a discounted rates, only through your service is again a good idea. Besides, in such a model, you will end up making a certain % of the proceeds on liquor sales through the agreement with the vendor, rather than having out of pocket expenses.

Try closing corporate accounts, school accounts, etc. Today more organizations and schools organize trips for their employees and students respectively, which will defintely help you grow your customer base without having to burn too much money. The only cost involved will be the cold calls, email campagins and the cost of transport to get to the meetings to close the deals..

Apart from this, another solution that comes to mind is tying up with credit card companies to help people purchase the trip and convert the total amount into a no-cost emi. People love to make small payments rather than blowing a chunk of cash in one go and this will further help you incentivise your existing and potential customers.

While all this is easier said than done, implementation is key.

Hope this helps.


Answered 3 years ago

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