Business Travel Tech Talk London, 16 October,
Business Travel Awards Europe, 30 October, JW
3rd Annual Business Travel Intelligence Summit
THE WRITING WAS ON THE WALL WHEN LONDON UNDERGROUND CLOSED its last ticket office in December – call it what you will, but paperless, contactless and mobile ticketing is the way ahead, and not just within the capital.
What began with the Oyster Card in London is slowly spreading to the nation’s railways. Some, like Southern, have introduced smart cards, but while these are aimed at everyday travellers, it’s the business travel world that is leading the rail ticket revolution towards mobile devices.
Just as air passengers now expect mobile boarding passes, so business travellers are increasingly being offered mobile ticketing when travelling by train. It’s something their travel managers are driving, because tickets bought centrally mean you have much more control over what is being spent and it’s easier to track where your staff are.
The need for change is evident, given the growing usage of our railways. Booking engine Evolvi Rail Systems estimates that total trade rail bookings amounted to £250 million a decade ago, but that it and main competitor Trainline alone now manage close to £950 million. High-speed services and wifi mean that for domestic trips such as London-Manchester, train, rather than plane, is the preferred choice.
If there is any starting point for the death of the orange ticket, it will surely be the corporate travel world. It’s already underway at Virgin Trains, which earlier this year became the first franchised rail operator to offer mobile ticketing across all ticket types and all journeys.
The concept is similar to that used by the airlines: passengers get a barcoded electronic ticket on their mobile device (known as an ‘m-ticket’) if they purchase through a travel management company (TMC).
Meanwhile, Cross Country now offers ‘Advance on the Day’ discounted tickets through TMCs, using Evolvi’s platform, which can be fulfilled as m-tickets.
All well and good, but don’t expect paper tickets to disappear any time soon. Following privatisation, our railways are a disparate set of companies all doing their own thing. If there is one area where state ownership would score over privatisation, it is surely having a common approach to technology. Moreover, it is easy to introduce the electronic gates needed to read them at the 27 or so major airports in the UK, but another thing to have them spread across thousands of train stations.
The Rail Delivery Group (RDG), which speaks for the railway system as a whole, is currently overseeing a pilot scheme covering more than 230 stations in the north of England, Scotland and the Midlands that lets people switch between different train operators’ services on a single journey using m-tickets. Until now, m-tickets have been limited for use only on one specific train operator’s services. That’s the good news, but the bad news is that the RDG only says it wants m-ticketing available nationwide “as soon as possible”, and adds that this “could be” within three years.
The view from the corporate travel world is sceptical as to when this will actually happen. “I wouldn’t like to put a timescale on it,” says Jon Reeve, Evolvi’s trade relations director. “So many operators are impacted by franchise length and other issues associated with investment. It’s different in the airline world because IATA guides it and you have global investment. I think we’ll still be using orange tickets for the next two- to-five years because they are currently the only ticketing that will get you from anywhere to anywhere.” That’s not to mention the further difficulties created once you factor in pan-European rail travel.
There’s a long way to go, but in the latter case, there have been strides made here as well, with booking tools, such as the Amadeus Air-Rail Display, effectively acting as a global distribution system (GDS) for both rail and air within Europe, offering fare comparisons between the two. As yet, however, it only works for point-to-point journeys.
On the buying side, having rail purchase data at your fingertips should make it easier to control spend, and to ensure compliance and pre-trip authorisation. Furthermore, having a booking tool that mirrors those used in the airline world allows you to compile accurate data on specific spend, which is a valuable bargaining tool when seeking deals with train operators.
Reeve says buyers generally ask for three basic things from their rail booking systems: trip authorisation; approval around a price point; and flexibility around compliance. This latter request means things can get complicated, such as instances when advance first class tickets are cheaper than standard second class fares because the lower fare category has sold out. Having overrides built into booking systems for this and other occurrences, such as travellers who purchase an advance ticket for the outward journey but a flexible ticket for the return leg, in case of a meeting overrun, is a necessity. Attribution is another issue, with buyers needing data relating to the costs of, for example, a specific project.
Requirements like these mean it’s all a lot harder than in the airline world, particularly when it comes to traveller tracking and duty-of-care. GDSs mean that corporates know when an employee has boarded a flight, but having a flexible rail ticket and taking the 09.30 train instead of the 09.00 leaves no such trace. Mobile ticketing will go a long way to alleviate this.
Trainline’s European director for business, Alidad Moghaddam, says mobile is “the hot topic”. “In 2016, it’s a bit strange that you have to queue and use a paper ticket. Mobile brings the industry up to speed with other modes of transport like air. Where customers have the option to use it, they are choosing it over paper.”
Moghaddam adds that mobile ticketing creates another incentive to buy through the purchasing platform and that this drives more compliance. It also, he believes, demystifies the sometimes mind-boggling ticketing permutations and encourages more responsible spending.
This is a key concern of buyers who see a lot of cash disappear out of the door when the most expensive tickets are bought unnecessarily, as one buyer from the insurance industry who wishes to remain anonymous, points out. “Our staff buy their rail travel in a very responsible manner in the main, but there is still quite a high level of buying fully-flexible tickets when advance tickets would work as well.”
It’s a familiar refrain to Daniel Lloyd, Diversity Travel’s operations manager. Currently, 28 per cent of Diversity’s rail tickets are mobile, which means there are considerable savings to be made for buyers in future when this proportion increases and greater control can be exercised. Lloyd adds that, meanwhile, consultants need to be more creative, offering advance tickets and persuading clients that a later or earlier train home will provide big savings.
“The main issues are that people leave it too late to buy and they have the perception that if there’s an app on their phone that they can do it themselves,” he says. “If they’re comfortable with doing that, they then ask why they need to switch to a TMC and give them that control – there’s a sense of ‘I know better’. There needs to be a re-education of the traveller.”
Moghaddam says he is “optimistic” that universal mobile ticketing will become the norm within a few years, but it’s not just the task of persuading 22 train operating companies to agree common standards, there’s also the issue that this might not be top of their list of priorities.
On the coalface of travel buying, there are sceptics. “Lots of people think they want mobile tickets because they don’t have to print or get TODs [tickets on departure] at the station,” says Kate Wimpeney, business development director at Redfern, which specialises in government contracts. “The reality is that at the moment, mobile is only applicable to advance tickets.” Indeed, research for the Office of Rail Regulation found that mobile ticketing was only available on 35 per cent of journeys.
Wimpeney clearly believes it is a case of the cart before the horse. “I sit on an old diesel train with no wifi, that’s too hot or too cold, with no hot drinks available, with replacement buses because the tracks are falling apart and I don’t for one second think mobile ticketing is coming any time soon.”
She concedes, however, that in some quarters, the aspiration is there, not least from the Association of Train Operating Companies (ATOC), which, Wimpeney says, receives “boxes” of unused tickets from Redfern each month for refunds. The ability to do this electronically will be one driver of change. Nevertheless, apart from more accurate tracking, she is sceptical of what mobile really offers. “The paper ticket really is the only obstacle – everything else, you can do on your phone or iPad.”
Ask a buyer what’s on their wish list, however, and the answer is emphatic: mobile. As our insurance buyer says: “We are very hopeful that mobile ticketing is very nearly here. We are seeing mobile ticketing with other travel sectors and the demand for all business travel requirements to be available in a mobile format is growing.” He is realistic, however, believing that the option for other methods, including the paper ticket, will remain for “a good while”.
Meanwhile, one final recent advance in technology is perhaps one of the most welcome. Late last year, Virgin Trains became the first rail company to give automatic cash refunds to passengers for delays of more than 30 minutes. This only applies to those on the West Coast mainline who book advance tickets through its website or mobile app, but it’s a start. Others please take note.