PredictX CEO Keesup Choe believes historical data on traveller demand, supplier prices and traveller behaviour will not be as helpful now as it once was
As the industry continues its recovery and we look for signs of how rapid this might be, it’s only natural that – given my line of business – I turn to data to look for answers.
The problem is, making data-driven predictions is challenging in a crisis where many unknown factors are at play, including office openings, health advice, infection rates, broad-based testing availability, vaccines, government guidelines and traveller confidence.
Even so, travel managers are currently planning and executing strategies for travel in an economy and market before they are entirely sure what it will look like. In addition to the usual changing traveller requirements, buyers will have to navigate many changes.
The post-Covid travel market promises to be unpredictable and supplier management strategies need to take that into account. For example, formal RFPs relying on historical demand will become less effective. Just like after 9/11, historical data is suddenly less relevant.
It will not just be demand that will change. The travel patterns and properties will be different. As the aviation and hotel industry recovers, your company’s preferred routes and hotels may no longer be in service. New pricing models and categories may need to be negotiated as suppliers make changes to their pricing strategies and products.
According to ARC data, the average ticket price in May 2020 was $353 – that’s $158 less than it was in May 2019, mainly due to decreases in demand. Will this decline continue? Will it increase? How much and how often will it change?
Many airlines, especially in the US, have stopped selling the middle seat in order to enforce social distancing so travellers are more comfortable. Right now, each airline has a different policy regarding the middle seat. Due to fluctuating customer demand, it is too early to tell whether this trend will continue. If it does, how much of a premium will these airlines charge? Will it result in another new 'class'?
More than ever, it is important to plan what the supply-demand equation might look like in the future. As always, seek feedback from travellers on how they may book in the future and what areas they need education on, so they feel confident and safe during their trips.
To ensure your preferred routes and cities still stay on the map, communicate these preferences to your suppliers. As travel resumes, be sure to keep tracking travel spend from all sources and share this with both suppliers and stakeholders.
We’re already seeing that booking patterns are changing, with reservations now made even closer to departure. We’re also witnessing changes in supplier choice, with new hygiene standards influencing brand choices. Unsurprisingly, the need to be safe from infection is paramount to travellers.
Covid-19 has quickly and drastically changed the business travel market. The past data we have had on traveller demand, supplier prices and traveller behaviour will not be as helpful now as it was before. As travel returns, however, data on current behaviour will become much more critical – leaving those who have invested in data as the most prepared.
The good news is that this period of uncertainty is only temporary. I believe there is no substitute for face-to-face meetings with valued customers, team members and prospects.
Even the CEO of Zoom predicts that once we return to travel, an explosion of new partnerships will be made. Nothing seals the deal more than a handshake or, in this case, an elbow bump.
Now let’s focus on changing our processes and procedures to adjust to the new normal while working together to help the industry heal. I still predict a bright future for the business travel industry.