A year ago Chase revealed that they would launch the new ChaseTravel.com. They promised over the summer that they were on target for a 2022 release. They didn’t hit that, but they’ve been in hiring mode recently and they’ve continued assembling the pieces.
- Buying cxLoyalty as a booking platform. The company used to run Chase Travel. Chase moved to Expedia, then bought cxLoyalty and now they have their own platform.
- Buying The Infatuation which also includes Zagat, as a mechanism for offering robust advice to customers. They’re building out hotel recommendations alongside existing dining guides, and the dining guides are actually quite good as far as these things go.
- Acquiring travel agents at Frosch International Travel because reasons.
- Launching airport lounges in partnership with Collinson (the parent of Priority Pass runs The Club lounges through their Airport Dimensions subsidiary).
Chase expects their travel platform will generate $10 billion in sales initially 2023, and $15 billion within a couple of years, becoming the third largest travel agency behind Expedia and Booking.com. Already Chase generates 25% of total leisure travel spend on its cards.
Last summer we learned that there were plans for a total of 9 Chase Sapphire lounges, but only 6 locations had been detailed. Back in September we learned about Washington Dulles lounge plans. In December we learned about Philadelphia. And now we learn from Thrifty Traveler the plan for Dallas – Fort Worth.
The lease is for space near gate D35 and is set to last 10 years, at a minimum cost of $6,448,706; 3% annual increases; plus a percentage of gross revenue.
The full slate of Chase Sapphire lounges appears to be:
- Boston: between Terminals B/C
- Dallas: Gate D35
- Hong Kong: Terminal 1 (Open)
- Las Vegas: Concourse C
- New York LaGuardia: Central Terminal
- Philadelphia: D/E connector
- Phoenix: Terminal 4
- San Diego: Terminal 2
- Washington Dulles: Concourse A
Chase Sapphire Reserve cardmembers, who receive Priority Pass cards anyway, will have free access. So it seems will anyone with a Priority Pass card (including one issued by another bank). That may seem weird, but Chase does want to be introduced to American Express’s and Capital One’s best customers, even if they don’t want to increase the value of those bank’s premium cards. Ironically, unless something changes once the first U.S. lounge opens, these Chase Sapphire lounges won’t be open to Chase Sapphire and Sapphire Preferred cardmembers!
Ultimately Chase sees an opportunity to capture more travel spend, and keep customers in their ecosystem. They see the same opportunity in the home and auto ecosystems, but haven’t really captured those. Travel booking helps them capture their customers’ travel spend in terms of experience. They’ll capture the booking commissions (which could reach $750 million, not pocket change even to Chase). And they’ll have even richer data to cross market to their customers – and to rent to other firms.
J.P. Morgan Chase is going up against American Express and now Capital One in the travel portal and lounge business. The problem is that nobody yet does online travel really well. Expedia hasn’t actually gotten better from a consumer standpoint in 20 years. Instead they spend a lot on advertising to bring customers to their site, and they sell those customers to hotels. They don’t actually add value to a customer’s trip, guiding them towards better experiences.
Travel is complicated and advice is missing. You go online and see schedules and price, or location and property features, but little to tell you whether to take that 45 minute connection in Chicago in winter, whether for your trip you should go out the night before or take the first flight rather than last flight of the day, and what kind of backup options you may have.
Google was supposed to disrupt travel search and booking but that’s been the next big thing in the space for over a decade. Whether or not banks deliver, having more competitors can only benefit consumers.
It’ll be exciting to watch but I remain skeptical because most acquisitions turn out badly and nobody has really done it yet because it’s hard. Chase has the resources but so does Google, and they have the AI programmers and personal data with which to do mass customization and personalization in a really unique way – yet they haven’t managed it (though Google Flights is quite useful). We’ll have a window soon enough, even though not quite as soon as we’d been promised.
Charlotte also has a Priority Pass lounge in A concourse
IAD concourse C / D desperately need a PP Lounge.
interesting Vegas terminal C – nice that gives an option when flying out of a different terminal than D with Centurion – it has not been worth making the trip. Of course I’m 7/24 so not getting Chase any soon than six months if I even make it.
Vegas and San Diego are the west coast options? Not good
I don’t use travel portals. Or lounges. I book direct, hang out in empty gates and eat cheese boxes from Starbucks and I love it. The plebs can have the portals and lounges.
For PHX, it will be the only PP lounge I.e. crowded by design. The list doesn’t have any real hubs except PHX and DFW so it looks like Chase doesn’t have any strategy and simply tries to collect a list of lounges to be able to claim “look, we are just like Amex, we have branded lounges, too!”. Oh, and raise CSR annual fee to $695 as well.
Forgot to add, it’s not real comparison of Chase Travel to Expedia or Booking. Chase travel audience is captive, it spends UR points, while other portals get real money. And, of course, the portal redemptions grew starting in 2023 since Chase gutted Pay Yourself Back feature.
Which of these locations are really needed? Many of these airports already have PP lounges and/or restaurants. And of course Amex cardholders already have lounges at many as well.
Seems like Chase is only targeting non-United hubs which of course is smart from a marketing standpoint but offers little benefit to its existing customer base. And of course almost zippo for the Western US which is a shame as LAX is desperate for PP lounges and OAK/SJC could use better lounges.
Contrast to Amex which has a presence at almost all major hubs, though coverage of multiple terminals is sparse.
Is the following a claim made by Chase? I infer that from the context (and the nice round number), but I’d be interested if there’s an industry review of spend for the major card issuers.
“Already Chase generates 25% of total leisure travel spend on its cards.”
There is no gate D35 at DFW Airport. The gates go D33, D34, D36, D37.
Fyi
Is my math wrong, or does that work out to over $17,500/day to lease that space, before the airport’s cut of f&b receipts? God damn is airport space expensive. I shudder to think about JFK’s price/sq ft
ORD quietly crying
SFO and LAX definitely need to be added to the list.
And they should limit access to be only Sapphire Reserve card holders until they are sure that capacity is sufficient for anything else, such as PP.
$10bn seems optimistic. Not sure what AMEX travel is worth but seems like they have a head start on chase so maybe thats a better target than Expedia and Booking.com in the near term
Ah, I wondered why my Chase Reserve was ignoring the now uselessness of Priority Pass as a perk. I had expected a new perk to replace PP. It’s not like Chase to ignore a perk that’s no longer valid. They’re out to conquer the world of travel & entertainment … they treat us very well. So far they seem to be doing everything right. Like the Virgin Atlantic Clubhouses, Chase will no doubt turn out some very good airport lounges.
Meanwhile Chicago doesn’t even have a useable lounge for us across two big airports. O’Hare has one lounge listed(only in the international terminal) that in a dozen times being there I’ve never been able to get into because, even when it’s empty, “we are reserving room for SwissJet passengers”. It’s a complete joke.
Do any of these locations target Southwest terminals? It would seem that might be a good strategy as Chase owns the SW cards and SW has no lounge network of their own.
The $95 per year plus $20-30,000 revenue throughput on my Sapphire Preferred card should provide this access. Even my old United card gave me lounge passes. This is appalling catering to the 1% while neglecting a powerful demographic. F your $500 per year status card.
It’s surprising they are opening lounges in San Diego and nothing at LAX.