Thanks Again seized upon the opportunity to expand its rewards program to merchants in the airport space, inking deals with airports in Atlanta; Houston; Tulsa, Oklahoma; Portland, Oregon; Seattle; and New York City.
Merchants pay Thanks Again a small monthly administrative fee plus 3% of each reward-earning transaction. Merchants also pay Thanks Again to analyze consumer-level spending data, and are charged a monthly retainer for these services.
The company’s revenues are directly tied to the number of members it has enrolled, since it generates sales when customers make purchases. Thanks Again currently has 200,000 members but needs 500,000 to realize profits. “We project we’ll hit profitability on a month-to-month basis by the middle of next year,” says Ellis, who projects that the company’s membership will reach 1.5 million by the end of 2012.
Although Thanks Again seems to be on stable ground with its growing revenues and partnerships, Leonard Greenhalgh, director of programs for minority- and women-owned businesses at the Tuck School of Business at Dartmouth, says Thanks Again’s growth depends on two factors: whether it has the cash flow to sustain its business model, and whether or not a competitor can duplicate that model. “The problem is that somebody else can decide to become an intermediary between the mileage programs,” Greenhalgh says. “What they do have going for them, though, is first-mover advantage. If they were first with Delta, Delta is not likely to substitute them with another vendor.”
But Eric Gilkesson, senior vice president of partner development for Thanks Again, says the company’s growing reputation in the loyalty rewards industry and unique value proposition for airports and local neighborhood merchants put it ahead of potential competitors. “It’s been a heck of a journey, but we’ve been laser-focused and dedicated to reaching [our] destination,” Gilkesson says. Entrepreneurship is not for the faint of heart. “You’ve got to have the vision and conviction to see it through.”