Continental Card May Lure Small Business

Posted by: Justin Bachman on November 25

Will airlines find in baggage fees a way to drive business to their affinity programs? Continental (CAL) customers catch a break on the customary $15 to check a suitcase if they carry the co-branded credit or debit card offered by Chase Bank (JPM). This twist on the card-baggage fee connection first surfaced in October, but for business travelers an even more interesting option came down the Continental pike this month: a $375 yearly card that waives the bag fees, gives you platinum level status with Hyatt, membership to Continental’s Presidents Clubs and “EliteAccess” priority for airport services such as boarding whenever you want and designated check-in lanes.

The card pitch also offers a $75 account credit after your first purchase. Continental’s airport clubs cost $475 for new members, so this could be a sign the airline aims to bolster its member roster, given the prospect that those memberships could be sacrificed to the new gloomy economic era. The card, while offering what is essentially a “teaser rate” for club memberships, could attract future paying members. If you spend much time in airports, those clubs – and the cocktails they serve – could be a real oasis for working and relaxing.

Yes, this Presidential Plus World MasterCard for Business looks like a naked grab for new card customers, playing off the relatively new fees for bags. Chase and Continental, of course, do not draw such a correlation, but those road warriors without elite status likely will. Many small or medium-sized business travelers may not travel heavily on the same carrier, or have a corporate contract outlining the parameters of their options, perks, ticket flexibility (or overall treatment) at a given airline. I suspect plenty of these businesspeople fork over the $30, or more, to get their suits, PowerPoints, laptops, manuals, and other work materials to and from clients – and feel degraded in the process. In other words, the bag fees impose larger costs on their business, while the traveler realizes the same experience value, etc.

Companies that do enough volume to negotiate with airlines can get such fees waived, along with automatic elite status, better seats, airport club passes, et al. The smaller business or entrepreneur has no such clout. That’s why I think for these folks this new card could be an interesting work tool. Its offerings are generous, considering the $300 price for the first year, which is sufficient to give you a test period to see how it works for your business expenses. Also, if you’re headed to a conference or client meeting with colleagues, all the people booked on the cardholder’s travel itinerary will have their checked luggage fees waived as well. “What we’ve really tried to do is produce a card that takes you from start to finish … and makes your travel easier,” says Mark Sullivan, a managing director in Continental’s marketing unit.

A quick glance through the offerings of rival carrier cards suggests that this Continental card may be unique, at least right now. (US Airways (LCC) offers a $90-per-year card through Bank of America that allows a $75 discount on club access, but no free bag checking.) For the budget-minded business – and which of them aren’t these days? – I wonder if we’re seeing a less-onerous path toward joining the elites?