Even though travel has slumped in the recession, Hotelzon has seen the number of online bookings rise. Jani Kaskinen, its ceo, tells ABTN how the downturn has made this and other changes to the industry
Like many companies Hotelzon, a hotel and venue booking agency, instigated a cost saving programme last year as the recession began to hit the industry. It expected things to be tough and with the general drop in bookings along with the fall in average daily rates, that is how it has panned out.
But what it did not expect was a rise in the number of bookings made online. Jani Kaskinen, who joined the Finnish company in February as its vp for sales and marketing and its UK ceo but has now become its ceo, said: "Online bookings have increased in the recession. The volume of them has increased for Hotelzon - we have seen a 30-40% growth.
"This increase has counteracted the downturn so we have not been hit as badly as expected."
This is just one development he has seen in the industry since he joined it earlier this year. Three others he has noticed are an increasing use of procurement to buy travel whose approach is different from travel managers, an increasingly professional attitude to managing travel and a greater use of technology.
"It's a big trend among larger companies to put travel under procurement," Mr Kekkonen said. "They categorise travel under different headings: hotels, flights, cars and they are looking to get the best deals in each category. So we find ourselves dealing with the procurement person who looks after hotels.
"This is working for us but it is against the TMCs. Companies are going online to make savings and with a self booking tool, they will also keep control of what is booked as well as having all the reporting. So it suits them," he said.
But he stressed that Hotelzon was not working against TMCs and wished to work with them.
Mr Kaskinen, who joined Hotelzon last February, said his company started noticing the trend away from travel managers in early 2008. "With the larger companies, we find we are dealing with the category manager or procurement director. Traditionally it was the secretary to the ceo or the travel manager.
"But we are not dealing with the travel manager anymore. This is a clear trend in the large corporations. I find it a very good development as my own background is in dealing with procurement people so it is familiar to me. This again is a kind of trend," said Mr Kaskinen who joined Hotelzon from The Customer Value Group.
This is a company which deals in best practice and for Mr Kaskinen that, in travel, is booking online, whether it is a hotel, a flight or a vide conference. The challenge is getting the best deal when you go online.
He believes it can bring major savings, for some companies of up to £200,000 over a three to four year period. As a relative newcomer to travel, he still laments the amount of travel that is still unmanaged although he admits that this is now "rapidly changing."
It is most prevalent in smaller companies. "When you go to these smaller companies, you can find that no one owns the process of managing or booking travel nor is there anyone who has the power to make any changes," he said.
"Many are now choosing to go to a travel agency and use them for their travel, outsourcing it, but that is the only level of control. They are just handing it over to someone else. These corporates don't see the benefit of recruiting someone to do travel. But that is one thing that has vastly changed throughout the year."
He said there are two benefits of using a professional to handle travel: savings and expert knowledge. "The obvious one is the cost savings but it is not all about money. But when booking a hotel, you are getting the opportunities to choose the best option for you. It is having a knowledge of travel, the knowledge of hotels, of flights...this highly specialised knowledge.
"But it is also about getting control of the whole process."
The rise and rise of technology in all aspects of travel is now a given. GDSs have moved some way from just providing CRSs; companies like KDS and Concur, primarily suppliers of expense management systems are spreading their wings and so are companies like Hotelzon.
Here it is enhancements on the basic online booking tool but ones which are aimed directly at the corporate bookers to provide both control and reporting. The latest, Hotelzon Mobile allows travellers on the road to change their hotel bookings and it works with Blackberries and iPhones.
"People who are not in their office can make schedule changes through this. But the changes can be made on the move while the control is still there," he said. As mobile phones become more sophisticated so such tools like Hotelzon Mobile are likely to become easier to use and therefore probably more widespread.
Hotelzon is also working on a new venue finding tool for the meetings industry. This, said Mr Kaskinen, is not one to deal with full scale RFPs but one with a far more specific aim: the ability to find and book small meetings space for groups of up to 50 people.
Hotelzon is also looking to provide technology for people to find venues or hotels with video conferencing facilities available 24/7 to cope with the participants from different time zones. "You can't see these hotels very easily. It is a job to find them," he said.
There was also the added problem of finding hotels in different areas whose technology was compatible. Such standardisation, Mr Kaskinen said, was some way off. But with the use of video conferencing growing - partly because of the restrictions imposed on travel by the recession, this is a market which is increasing.
"This is becoming a bigger part of travel management. It does not mean that meetings and travel are going away. But you are making trips shorter," he said. If people make shorter trip to hotels in different cities which have video conferencing links, rather than all flying longer distances to one hotel as in the past, the cost of the meeting could be halved.
He said he believed the changes made in the industry over the past year would be permanent. "I don't see these trends going back. We don't see anyone that wants to go back. This recession has created opportunities for people to develop their technology.
"I think some of the travel will never come back because people will stay with the new developments. But I think the amount of travel will grow because businesses will grow. I feel optimistic about it as we are in a position to grow in the market. We have our own technology, our own research and development people and we have a long term view."