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3rd Annual Sustainable Business Travel Summit
CEOs of three major suppliers debated a range of issues during a session at the GBTA Convention in San Diego, including open booking, the ‘sharing economy’ and the business-leisure divide.Moderator, Philip Wolf, founder of Phocus Wright, opened the session by saying travel and tourism is the world's third largest industry and is responsible for around 9.3 per cent of global GDP.
He asked the panel how the ‘sharing economy’ model - which allows collaborative access to goods and services through technology - might impact business travel.
In response, Michael Batt, founder and chairman of Travel Leaders Group, urged airlines to “give us the opportunity to sell half a seat”.
He proposed selling the middle seat on aircraft to two travellers, so they effectively get half of the seat each.
“Nobody likes touching elbows with people,” he said. “With today’s technology we could tag those travellers we know would pay 50 per cent extra for half a seat.”
“They would be the most profitable seats on the plane for the airlines. They get full fare and there’s less weight on the plane so saving fuel. The cabin crew would be delighted – there’s nobody to serve. Most important thing your traveller would be delighted.”
Steve Singh, CEO of expense specialist Concur, said businesses should be practical and open-minded about the concept as it will be increasingly accepted, citing the success of the Zipcar car-sharing venture.
The panel were asked if it was good practice to view managed travel as a separate ‘silo’ entity from general travel.
Concur’s Singh said: “You’ve got to find a way to merge consumer and managed travel behaviour,” pointing out that since the inception of Trip it (which Concur bought in 2011) two-thirds of trips on the consumer-focused travel organisation tool have been business trips.
Batt, whose Travel Leaders Group generates annual sales of around $18 billion, said: “There’s a huge opportunity, given the technology we now have, to bring in leisure purchasing, and get compelling deals for our corporate travellers for their leisure travel.”
Talking about being at the forefront of change, Best Western CEO David Kong said: “There’s a danger to being at the leading edge, you can get a massive surprise. We find it’s better to observe the trends that take place, and try and envision the future.”
Kong said that the situation of people upgrading their smartphones every two years offers forward-thinking businesses “a built-in market for innovation”.
He also noted a “surprising” trend: “We found that because so many last-minute bookings are being made on smartphones, calls to our central phone reservations office have gone up in last few years. This is a total reverse from the previous trend. It’s because people are clicking the ‘call’ button on the mobile booking site.”
Singh added: “Today, you can’t just do what you do well, you have to incorporate the ability to change - this ability should become a core asset and part of your culture.”
On the subject of open booking, Batt said: “You don’t want a free-for-all. If it’s about bringing in data that should be managed by the corporate or agent, and actually bringing those bookings outside the system into it, then I’m all for it.
“If it’s about accepting the urban legend that millenials are really smart at scouring the internet and they can do a better job than corporate travel managers – I don’t believe that for a minute.”
Kong said that from a supplier’s point of view there were “wins” from more sales via their own websites and loyalty schemes, but expressed concern that this behavior could erode meaningful corporate preferred supplier deals.
Concur’s Singh added: “Open booked transactions are happening all the time, every day, you may not like it but it’s happening. Our view is that we should be able to allow person to book with different brands, but we should bring that information back into the managed travel programme.
“It’s also really important that the corporate rates that a customer negotiates should be upheld and delivered on that booking.”
He said the same applied to bringing outside booking information into the system for traveler tracking and duty of care purposes.
GBTA unveiled research at the convention that predicts a 5.4 per cent year-on-year increase in global business travel spending in 2013, forecasting a total spend of $1.12 trillion. It also forecast annual growth of more than 7 per cent in the years to 2017.