My sense that yet another year has flown by reveals something about my age for sure. On the other hand, it is undeniable that industry change came fast in 2019 and has left an indelible mark as we close out the year.
Just a year ago, we were knee deep in NDC speculation. What is this new acronym? Are we really going to have to understand it or will it go the way of so many iterations of disintermediation we’ve seen in the past? What does it mean for my program and will my TMC partners be prepared?
What are all of these new technologies and can they compete? Have the TMC’s become the “old guard” or is Silicon Valley taking a foray into territory it just doesn’t understand?
So, here we find ourselves at yet another unique time in the corporate travel business. The changing demographic of the corporate traveler is no doubt driving long term supplier strategy and massive investment into the future of our business and rightfully so.
Millennials (yes, them again), now represent 35% of the workforce and most are in their 30’s. These guys and girls are middle managers now, heavy travelers, understand the changing world of technology in a way that leaves the rest of us who still use legal pads and ball point pens shaking our heads. If you do any research, you find that these emerging leaders of business enjoy self service, demand technology across all aspects of their lives that simply works, and rejects the idea of business as usual – work should be fulfilling, fun, and collaborative. I see evidence of all of this all of the time at client locations – large workspaces, flexible work environments, and lots of “free stuff” to eat. And if you look a bit more closely, these traits fly directly in the face of corporate travel as most of us know it. Don’t misunderstand, the investment the industry has made across all facets of corporate travel technology and capabilities is overwhelming. Still, not a week goes by where I don’t hear complaints about leading technologies or process being “clunky”, “hard to use”, “not flexible enough” or from a business owner asking me “isn’t there a better way of doing this?”
Prescient (and also self-deprecating) as we are at CapTrav, the writing has been on the wall for years. When we conceptualized CapTrav our goal was to not only add considerable value to existing corporate travel programs but also to respond to these growing client demands. First, we knew CapTrav had to provide a ton of value. When you consider the sheer number of technology offerings available in the corporate travel industry, we knew mind-share would be difficult to come by. By seamlessly capturing corporate travel data no matter the booking source and normalizing that data into truly meaningful information, our clients would gain visibility into all of their program “leakage”. Considering that even well-run corporate travel programs experience between 25-50% leakage across air, car, and hotel bookings, the value to leverage supplier contracts and satisfy potentially costly duty of care/risk requirements is enormous. Second, we knew that CapTrav had to be easy to implement. Today, traditional TMC implementations can take months and, in some cases, years depending on myriad factors including GDPR requirements. CapTrav can be implemented in hours. And third, we knew that we needed to make sure we could capture data typically not part of a corporate travel program – ridesharing, AirBNB, VRBO, and other non-traditional sources that are becoming part of most programs but not included or leveraged as part of the program.
At CapTrav, we are fielding calls from corporate travel managers, category managers, and procurement professionals asking us about this industry change, how to adapt and how to think about program optimization for 2020. We have also received an unprecedented amount of calls from small to mid-sized businesses who have never considered a formal corporate travel program but now believe there may be something for them since CapTrav (and others) has re-positioned the notion of what corporate travel management can really be.
If you’re a corporate travel manager or category manager responsible for travel, your job is getting more difficult. Now more than ever, business owners want to understand the impact travel has on the health of the overall business. Corporate travel is no longer a relationship driven, siloed, spend category. And now, corporate travel category owners must also deal with the fact that their travelers comprise different generations, both of which may have opposing needs. How the business manager deals with satisfying their constituencies will have the ultimate impact on the success of the travel program and in our experience, satisfaction comes as a result of balancing comfort and convenience with fiscal and fiduciary business sense. None of this can really be accomplished without data.
The result of all of this is that corporate travel managers must use the best available tools and technology to help make the best business decisions possible. Some new entrants are focused on a better experience. To a large extent, corporate culture will drive the early adoption of some of these new solutions and we are seeing most clients interested in slowly dipping into these waters. But as corporate travel becomes prolific within organizations in terms of how money is spent and its return on investment, big data is good but better data is critical and is now much more widely available. No matter how great the offering, business owners still have to deal with systemic program issues poised to present even greater problems as NDC takes hold in earnest and as millennials in particular get more exposed to seemingly easier travel options. Measuring program leakage and driving compliance through robust benchmarking will no doubt play an even greater role in how the corporate travel manger identifies both supplier opportunity and use of new technologies. Corporate Risk Management also recognizes potential issues as it relies heavily on traveler data coming out of the TMC of record.
CapTrav has seen a dramatic increase among senior management around these issues among both larger global organizations well versed in traditional corporate travel management and in the SMB space where business owners are being exposed to solutions seemingly hand-crafted for their specific needs. CapTrav provides better data to help organizations make the best possible business decisions given emerging technologies, NDC, and the changing employee demographic. Client questions are getting smarter every day as new technology, capabilities, and a changing management landscape takes hold. How are we benchmarking our program? How do I really know I’m getting the best deals? Do I know where all of my travelers are no matter where or how they book? At the same time, we find ourselves explaining all of these concepts and building business case models for organizations who have never considered a formal corporate travel program.
I fully expect 2020 to fly by in a similar way as this year. And I fully expect even more change. I tell clients nearly every week that even after 20 years in the industry I learn something new every day. And I think it’s for that one reason, I plan on being around another 20 – or until my business partners kick me out!