An Inside Look at How Badly the Pandemic Hit Clear at the Start of 2020

Original article was published by Dave Gershgorn on Artificial Intelligence on Medium


The near-total shutdown of air travel during the coronavirus pandemic could have been an existential crisis for Clear, a company best known for ferrying travelers to the front of the airport security line.

But despite massive downturns in the number of people flying, the coronavirus pandemic only had a temporary impact on Clear’s airport business, according to revenue documents obtained by OneZero from airports around the country. And at the same time, Clear has set its eyes on expansion in other areas like health and biometric payments, as OneZero reported on Tuesday.

These documents also detail how the company treated its own frontline workers, promising that their jobs would not be lost and paying for health insurance even while some workers were asked to go on temporary leave.

Clear generates revenue by charging users a $179 annual subscription fee to access its priority security lines in more than 60 airports and sports stadiums across the United States. Some stadiums, like the Seattle Mariners’ T-Mobile Park, have even integrated Clear’s biometric payment system, which allows customers to use only their fingerprint to verify they’re over 21 and pay for a beer. The company says it has more than 5 million members, although that figure also includes its free tier, which allows priority access to sports stadiums.

Clear’s revenue at the Cleveland Hopkins International Airport fell off a cliff in April, falling nearly 45% from $216,885 in March to $121,273 in April.

Clear makes a significant amount of its revenue from airports. It typically shares between 7.5% and 12.5% of its revenue with the airport that generated it — from subscribers who opt in to the program via one of Clear’s kiosks, for example. These agreements can generate millions for individual airports each year: In September 2019, Clear projected that it would pay LAX more than $3 million that year, a figure the company anticipated would grow to $5 million by 2025, according to documents reviewed by OneZero.

But the coronavirus temporarily halted the company’s previous steady growth, at least at some airports, according to revenue documents.

At Cleveland Hopkins International Airport, Clear’s monthly revenue in 2019 rose from March until summer, peaking in the vacation months of June, July, and August, and then slowly fell until January.

But in 2020, Clear’s revenue at the Cleveland Hopkins International Airport fell off a cliff in April, falling nearly 45% from $216,885 in March to $121,273 in April.

In Minneapolis Saint-Paul International Airport, Clear hit the highest revenue it has seen in at least two years in March 2020, totaling $1.1 million. In April, that revenue had plummeted more than 50% to $514,282. In May, that number sank lower to $380,218.

But in the months since, documents suggest that Clear’s revenues have recovered. Revenue at Cleveland Hopkins International Airport as well as the Minneapolis airport began to recover in June, and by July both airports’ revenue was nearly where it was in the same month last year.

The exact cause of the increased enrollments is unclear, as air travel is still way down compared to last year. The Bureau of Transportation Statistics recently reported that 70% fewer air passengers flew in August 2020 compared to 2019.

Clear confirmed to OneZero that the company is seeing an increase in people enrolling in their service again, and credits its “touchless” technology as the reason.

“Clear is one of the only touchless technology identity verification solutions in airports today, and as travelers seek out safe and easy ways to feel confident walking into an airport again, we are seeing enrollments increase,” spokesperson Maria Comella wrote to OneZero in an email.

Clear CEO Caryn Seidman-Becker committed to keeping Clear’s entire workforce employed.

Documents obtained by OneZero also illustrate how Clear is grappling with the responsibility of employing frontline workers around the country.

A bulk of Clear’s employees are so-called ambassadors or the airport-based workers who recruit new members and get them set up at Clear kiosks. Ambassadors are the ones most directly tied to Clear’s revenue, making them the crucial part of the company’s meteoric rise as a staple in America’s major airports.

In an email to employees on March 27, Clear CEO Caryn Seidman-Becker committed to keeping Clear’s entire workforce employed, though some ambassadors would have their hours reduced or temporarily furloughed. Clear confirmed the veracity of the letter obtained by OneZero.

“As air travel slowed in the wake of the pandemic, Clear believed the best way to protect our team was to place a number of ambassadors on a Covid leave of absence plan. This policy has allowed us to preserve the job of each and every full and part-time ambassador, as well as their healthcare, status and standing. Additionally, it gives flexibility to ambassadors without hours to take advantage of Covid related government assistance programs until they come back to Clear,” wrote Comella.

Meanwhile, according to an email to staff obtained by OneZero, Clear committed to pay 100% of health insurance contributions, and pay out a “Care Bonus” to every ambassador. Those who continued working would receive higher commissions and PTO rates. Those whose hours were cut would also receive a bonus when they returned to work, and higher commission rates to make up for the lost commissions during the pandemic.

“In a perfect world we wouldn’t have to change anything, because what’s best for our ambassadors is being able to show up to work at busy airports, assisting travelers and signing up new members,” she wrote to staff.