Could a travel club be right for your bank?

Community banks can foster relationships and boost customer loyalty with travel clubs. Could it be right for your bank?

By Mary Yerkes

Does the thought of a German river cruise or a two-week European tour appeal to you? Or do you prefer attending a local sporting event to snorkeling in the Bahamas? Either way, there’s a trip that’s just right for you—and your customers.

Many community banks incentivize consumer loyalty and foster customer relations by offering travel packages and other perks, especially for account holders who are 50 years of age and older. These programs, often touted as clubs for a community bank’s longest-standing or highest-quality customers, help to retain high-value customers and attract more of the same.

How do community banks set up these travel clubs and perks, and what should banks consider before launching a travel club of their own?

Quick stat

2.3 billion

trips were taken by Americans for business and leisure purposes in 2018

Source: U.S. Travel Association

Consider First Community National Bank (FCNB), a $135 million-asset, six-branch bank based in Steelville, Mo. FCNB established its travel club in 1988.

“Back in 1988, many people were starting to travel extensively, and group travel provided a very safe environment,” explains Becky Simpson, marketing director at FCNB. “People trusted their financial institution, so they trusted the bank’s program director with their travel.”

Initially, the bank limited its club membership to older customers, but about 10 years ago, FCNB opened it up to customers of all ages and their guests.

“It is really about building customer loyalty and relationships,” Simpson says. “We have multiple companies within our bank. These trips allow us to know more about our customers and cross-sell.”

“It is really about building customer loyalty and relationships. These trips allow us to know more about our customers and cross-sell.”

—Becky Simpson, First Community National Bank

When FCNB’s club first launched 31 years ago, the bank’s travel director accompanied its customers on all of the trips. But with the growing roles and responsibilities of the bank’s staff, that’s no longer possible. That’s not a problem for the bank or its customers, though. FCNB has a longstanding relationship with several travel agencies, which provide an experienced host for the trip to help ensure a quality experience for the travelers. Earlier this summer, the group traveled to the St. Louis Cardinals game.

To keep costs down for its customers, FCNB also sometimes participates with partner groups when organizing a trip. The bank is often able to find a partner group that is a noncompeting group, such as a bank in another state. For instance, if you plan a trip to New York and you bring 20 travelers and your partner bank brings 20 travelers, you have a joint group of 40 passengers, making the trip viable for everyone.

Building trust

The Bank of Marion in Marion, Va., offers travel club memberships to select customers. In most cases, to qualify for membership, customers must have either a Platinum Interest Checking account (maintains a minimum balance of $1,500), a Fabulous 50 Interest Checking account (account holder is 50 or older) or a Direct Interest Checking account (customer uses direct deposit or automatic payments).

“Our club is an incentive program for high-worth individuals,” explains Sam Russell, director of marketing for the $383 million-asset community bank. “Our goal is to retain high-worth customers and attract similar potential customers.”

This year’s events include a trip to New York City by Amtrak to see a Broadway show and a tour of Branson, Mo., that includes dinner and entertainment on a showboat.

“The main perk for the customers is that they come to a bank that they trust to plan their travel for them,” says Tammy Shuler, the bank’s marketing assistant and travel club director. “They know we will look out for their welfare. It’s like family traveling together.”

“They know we will look out for their welfare. It’s like family traveling together.”

—Tammy Shuler, The Bank of Marion

Like many of the banks offering travel club memberships, the bank provides the trips at cost or as close to cost as possible.

When asked about the bank’s ROI on its travel club, Russell pointed out that a happy customer is not going to leave the financial institution, and the travel club keeps members happy.

“Our customers think of our bank as part of their family. We’re a small-town community bank with family values,” Russell says. “If our customers are happy, they recommend the bank to peers and family members.”

Russell admits the community bank doesn’t have any hard data as to its return on investment, but he says the bank knows from continued results that the club is worth the effort. “If I have someone who is interested in going on one of our tours but who is not a member, the club can incentivize that person to move over to our bank to join the club,” he adds.

Community Bank Mankato, a $305 million-asset community bank in Mankato, Minn., hosts a Primetime Club, which it launched in 1980. Club members can participate in local trips and receive several perks. To qualify for the bank’s Primetime Club, customers must be 50 or older and maintain a minimum balance of $1,500 in total bank deposits in checking, savings and certificates of deposits.

In addition to hosting local day trips, the bank brings in experts to address topics of interest to club members. For instance, the club brought in a lawyer to discuss estate planning and an emergency room doctor to speak on preventing falls and what to do if a fall happens. Club members also receive a monthly newsletter highlighting the group’s monthly activities and a quarterly Money Matters magazine, which features a column written by the bank president and other articles of interest to club members.

“We put a lot of time and work into the club,” says Katie Beadell, the director of the Primetime Club. “It’s very rewarding work. You get hugs and thanked repeatedly for the opportunities we provide. It’s worth it.”

Tips for starting a travel club

By now, you may be wondering if starting a travel club is the right choice for your financial institution. After all, who doesn’t want to strengthen customer relations and boost customer loyalty?

To explore whether a travel club might be the right choice for you, start by doing your research. Talk with travel club directors from noncompeting banks to get more information, and then float the idea by your bank staff.

Another important consideration is the location of your bank. Banks in small towns and rural areas may generate more interest, especially if the town has few amenities and events. Retiree destinations are also sometimes more responsive to travel clubs.

Once you’ve determined the viability of a travel club in your location, you’re ready to take the next step. Start by offering a low-risk day trip, promoting the event by posting flyers and posters and hosting an informational meeting. An informal meeting allows you to answer customers’ questions and address concerns.

Finally, don’t be afraid to fail. If your first event doesn’t get the response you were hoping for, try another. And another. To learn what your members like and don’t like, survey travelers after an event, and make adjustments based on participants’ responses.

Over time, you’ll get a better sense of whether a travel club is a viable option for your financial institution. While travel clubs are a great way to enhance customer relationships and foster customer loyalty, they aren’t the only way. They can, however, be one of the most enjoyable and rewarding ways to build deeper relationships with your customers.

Wish you were here…

Community bank travel clubs offer a wide range of travel opportunities for its customers, ranging from local dinner club theater to exotic international trips. Here are a few recent and upcoming trips to give you a taste of what’s possible. Travel club participants can:

  • Watch a St. Louis Cardinals game at Busch Stadium
  • Enjoy a guided hike of Alaska’s Denali National Park
  • Go snorkeling in Mexico
  • Explore Vienna, Budapest, Bratislava, Passau and Esztergom on a Danube Classic Cruise
  • Discover the beauty of New England foliage with stops in Vermont, New Hampshire, Maine and other states.
  • Visit European countries, such as Ireland, Scotland, England and more
  • Go humpback whale watching in Hawaii
  • Stand on the North Rim of the Grand Canyon
  • Float down the Snake River
  • Attend a rodeo in Wyoming
  • Enjoy the crystal-clear waters of the Caribbean
  • Discover New Zealand

Mary Yerkes is a writer in North Carolina.