FLO Corp. [FLRP], the Registered Traveler (RT) service provider that hasn’t had much luck in getting airports to sponsor its service, is aggressively going after members and plans to keep vying in airport competitions for the exclusive right to open its own RT lanes, a company executive tells TR2.
Last year FLO was selected by the airport authority at Huntsville International Airport in Alabama to possibly install an RT lane there and the company is in the process of acquiring Unisys’ [UIS] rtGO RT assets and brand, which is operating at Reno-Tahoe International Airport in Nevada. The authorities at Huntsville have been waiting to see what screening benefits they can get for their customers, particularly top military officials such as four-star generals.
“They think it’s ridiculous that a general has to disrobe with all his medals,” Luke Thomas, executive vice president at FLO, says. “They were looking for some screening benefits to let some VIPs through a little easier and open it up to all their customers.”
Meantime, FLO has lost recent airport competitions to Verified Identity Pass, the largest and most recognizable RT provider through its Clear brand. In January the airport authority in the Washington, D.C. area selected the Clear service to be installed at Dulles and Reagan National Airports.
While FLO may have been distracted in some earlier airport competitions as it went through the acquisition process for rtGO, Thomas says, “We thought we has a real good shot at Washington, it just didn’t go our way. I’m going to make excuses. Some of the other ones we probably didn’t have as good of a story developed with Unisys and an integrated message because it was so new but we were certainly on the page at DC.”
Winning airports is important because its’ chance to help build the brand given exclusive rights to market there, Thomas says. It may also help the service provider attract more members but Thomas says that’s not clear yet.
“I think if you’re all about the brand, which our competitor is, that’s certainly of high value,” Thomas says of winning airports. But, he adds, “I think in certain ways we’ve been winning the battle in the field on customers.”
So far Verified Identity Pass has over 95,000 customers for Clear. FLO has yet to say how many members it or rtGO have. Vigilant Solutions, another RT service provider, operates its Preferred Traveler service at Florida’s Jacksonville International Airport. Each of the RT Service Providers offers various benefits to go along with its pricing packages. FLO’s basic annual membership package begins at $100 and Verified Identity’s begins at $128. Vigilant’s prices begin at $149 annually.
Under RT, the smart cards used by any member of an RT Service Provider are interoperable and at any airport’s RT lanes, regardless of which provider established those lanes. The various service providers are currently in discussions regarding tolling fees that they would pay each other depending on when a member of one provider uses a competitor provider’s RT lanes at airports. These fees would help defray the infrastructure and other costs that each provider is responsible for when it installs its equipment at an airport.
Thomas says that FLO has been selling its RT cards that its members use to get through any service providers’ RT lanes at participating airports. FLO will soon be announcing a “significant number of corporate commitments around the country,” he says. FLO has been onsite at two corporate campuses in California and in other U.S. cities enrolling members, he adds.
The key to attracting members is “flexibility,” Thomas says.
Marketing Plans
Establishing enrollment services at an airport is just one way to attract members and Thomas says FLO will be doing this as it expands into more airports. However, the company’s main marketing strategy is the scheduled enrollment campaigns at corporations. FLO began doing this actively late last year, Thomas says.
“So we’ll sent a team in using mobile kiosks and set up either in their cafeteria or lobby or some kind of common area that the corporation requests and we’ll have scheduled back-to-back enrollments all day long,” Thomas says. “And that’s the most highly efficient use of our resources.”
A third method FLO is using is partnerships in the travel and leisure industry. Last month the company partnered with Hilton Hotels and the Society of Government Travel Professionals (SGTP) to market flow.
Under the agreement with Hilton the hotel chain’s HHonors members will be able to redeem points for FLO memberships. FLO will set up enrollment kiosks at select hotel locations to do the enrollments for the HHonors members and nearby corporations.
The deal with the SGTP gives FLO access to 550 government travel agencies who cater to government employees spending $7 billion annually for travel. “Our members will be very excited about the value-added benefits packages offered by FLO, the favorable pricing and the all important front-end discounts,” says Rick Singer, executive director of SGTP.
The deal for rtGO is expected to close later this month. Thomas says that the rtGO brand and kiosks, which have already been certified by the Transportation Security Administration (TSA) and received SAFETY Act approval. FLO announced plans to acquire the rtGO assets from Unisys last fall. When the company began discussing the possible acquisition earlier last year, it backed away from going through the TSA certification process with its kiosk technologies and turned its focus to marketing and distribution, Thomas says.
“We’ve been very aggressively building out a sales team and a corporate outreach program and distribution chain for the cards while we acquire all the technology,” Thomas says.
But Thomas also says that for FLO, “We’re not all about the brand.” Given that the travel, leisure and hospitality industry is very mature, FLO isn’t going to insert its brand into the middle of that, he says. More likely there be something like a Hilton RT brand and brand names of other FLO partners on an RT card, and on the back of the card will be an rtGO bug that’s “empowering other brands that are already established in the market,” Thomas says. That’s the “Intel inside” model, he adds.