Retail giant Wal-Mart Stores, Inc.’s (WMT - Analyst Report) Sam’s Club division has launched an online booking service – Sam’s Club Travel - to serve the business and leisure travel needs of its members. It has partnered with Tourico Holidays, a worldwide leader in innovative wholesale travel services, in this regard. Tourico’s business model aims to provide reasonable deals to its members, even amid rising costs of fuel, flights and accommodations.
Through its SamsClub.com/travel website, Sam’s Club members can select their choice of destination or opt for any vacation package and also save on every package selected from an available range of 4,500 worldwide destinations, 90,000 hotels, 150 airlines, 18 car rental brands and 13 cruise lines. The website is user-friendly, hassle-free and does not allow pop-up windows and external sites to interfere.
In addition, members will also have access to the portal’s integrated TripAdvisor reviews, real time price comparisons, “Click to Chat” instant member service and secure booking services.
Members can save up to 50% on selected hotels; up to 10% on rental cars; up to 15% on cruises; and up to 25% on attractions and activities. Members can save even more using the new 5-3-1 Sam’s Club MasterCard, which is co-branded by MasterCard Inc. (MA - Analyst Report) (Read: Wal-Mart to Issue Chip-based Credit Cards). The card will provide 5% cash back on fuel purchases, 3% cash back on travel and dining and 1% cash back on all other purchases.
We believe that Sam’s Club has launched its online service at the right time when demand for travel is rising in the U.S., despite increasing cost of travel. According to the U.S. Travel Association, domestic leisure travel is expected to rise 1.7% in 2014 to 1.6 billion trips, while working Americans are expected to take 452 million domestic business travel trips in 2014.
Walmart has been struggling of late and performed disappointingly in all the four quarters of fiscal 2014 and the first quarter of fiscal 2015. The company is therefore seeking new ways to boost revenue amid macro-economic headwinds like budget-strained customers, reductions in government benefits, higher taxes, tighter credit and higher group healthcare costs.
The move to provide online booking service for its members is surely an encouraging step to combat a sluggish revenue environment. Walmart currently holds a Zacks Rank #4 (Sell).
Some better-ranked retailers include Ingles Markets, Incorporated (IMKTA - Snapshot Report) and Dillard's Inc. (DDS - Analyst Report) , both of them holding a Zacks Rank #2 (Buy).