i2c - The Credit Economy June 2023

Wheels Up Creates SMB Private Jet Membership in Bid for Recurring Revenue

Wheels Up

As more businesses take on a monthly subscription model to offer their services, even private jets are getting the membership treatment, with Wheels Up bringing more corporate customers into the fold.

The on-demand private aviation company announced Tuesday (Oct. 31) the launch of its Up for Business membership for small- to medium-sized businesses (SMBs), an 18-month contract with a significantly lower deposit ($250K-$300K) than its membership for larger businesses ($500K to $1M or more), with an additional initiation fee and annual dues.

“Historically, smaller- to medium-sized businesses were forced to adapt to either a product that was designed for individuals or a solution that was built for large corporations.” Robert Bourrier, executive vice president, global sales, said in a statement. “We see an opportunity to deliver a tailored product to members rather than a one-size-fits all offering, while capturing the operational and financial benefits of a balanced fleet utilization throughout the week.”

For this membership, these businesses get discounted round trips, among other benefits.

Overall, subscription models are proliferating across B2B commerce. For instance, Meta observed in its recent third-quarter earnings call that, following the success of the initial launch of its Meta Verified subscription for consumers, it is now turning to the corporate market opportunity.

The company’s Chief Financial Officer Susan Li noted that the company “recently began” testing this B2B iteration of the membership on Facebook and Instagram in a small number of markets, with plans to “expand that” to corporate customers on WhatsApp, offering features to allow businesses to “more easily stand out on our apps and build confidence with their customers.” 

Indeed, as consumer-facing subscriptions take off, B2B services are following in their footsteps. 

“Everything shifted to even more subscription bases,” Gravy CEO Casey Graham noted in a conversation with PYMNTS. “More subscriptions are flooding the market — this is true for B2C, but it’s also very true to B2B.”

Additionally, in an interview with PYMNTS, Russell Klein, chief commercial officer at BigCommerce, explained that subscription commerce enables businesses to instill a degree of predictability their vendor and client relationships, especially as more B2B commerce moves online.

“It comes down to de-risking this relationship, extending out the lifetime value and then carving up that pie a little bit,” Klein told PYMNTS. “If I as a seller can get more lifetime value, then on the flip side, I can either keep that or give part of it back in the form of discounts, rebates or other ways to keep that customer — who’s given me their money on a regular basis — that much happier.”

Overall, more and more day-to-day activities for businesses and consumers alike are getting the subscription commerce treatment. From taking classes online to watching concerts to getting healthcare to ordering from restaurants, membership models are emerging across more spheres of life, and major players in the space are continuing to see growth. Tech giants ranging from Microsoft to Google to Amazon are all seeing strength in their subscription businesses — it’s no surprise then that others would look to get into the space.