FlyerTalk Forums - View Single Post - How does Priority Pass stay profitable?
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Old Jan 3, 2019, 5:25 pm
  #13  
ECR
 
Join Date: May 2014
Posts: 411
Originally Posted by CRAZ8
I think of it differently.

If a PP user can't get into a lounge with their card, then the utility of the card is gone - actually, it's worse because the expectation is to get access, and being denied leaves a bad taste. If that customer then cancels the credit card that provided the card, then their value proposition to credit card issuers becomes less and they will lose the issuers and their payments. There are lots of complaints of being turned away from a PP lounge on here.

Providing many chances to use PP at an airport is great for them, as it gets people using the product. As long as the average number of visits per account is below their cost, they are profitable. And if if too many people do use the card, they can re-negotiate with the banks and show that they have satisfied customers! Unlike FlyerTalk visitors, not everyone will arrive 6 hours early and visit every PP restaurant possible!

Adding more capacity for end-users makes the PP card more useful (and more reliable), and therefore more valuable for the card issuers, and thus allow PP to build their business.
Priority Pass must think along similar lines to you, hence their continuing to add restaurant options.
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