Industry observers have watched SAP Concur dominate the corporate travel space since Cliqbook (Concur) took over the reign from GetThere. Today, Concur has an integrated solution for clients across most of the corporate travel supply chain – front end booking to mid-office functions and expense. They are the go-to solution where, in many cases, using the booking tool is dependent on corporate finance’s decision to implement expense and vice versa.
There’s Still Room for Competition
Still, against a $1 trillion global industry, there is room for competition. The size of the industry coupled with the fact that the majority of corporate travel expenditures are not formally managed through a traditional travel management company and companies in the small to mid-market are essentially ignored by travel suppliers has led to massive investment in start-ups. The most significant investments have been made on what amounts to a “better mousetrap” aimed to compete directly with SAP Concur or to carve a niche in the under-served small to mid-market. And while I can’t argue with the investment logic – capturing a very small percent of a very large market yields huge return – it strikes me that there should be more investment in visionary technology that meets this market demand and I have to believe the visionary tools are out there waiting to be discovered.
Concur didn’t just build a better mousetrap – they built a vision. At a time when the TMC community was scrambling to build super PNR technology for fear of GDS disintermediation, Concur bought TripIt (for over $100 million on no revenue, by the way) so that it could provide an itinerary view of all traveler bookings no matter where or how they booked. When industry quality control systems started gathering dust, Concur bought GDSX.
Concur understood the marketability limitations of a booking engine and pivoted to focusing on expense and expense integration to provide a compelling return on investment for Finance departments (who have far more budget than travel departments). Today, Concur leads with expense and has invested millions in TripLink in an effort to more seamlessly integrate with suppliers, further streamlining expense reimbursement and the corporate travel supply chain. In a lot of cases, Concur doesn’t even charge for use of the booking tool anymore as long as you’re an expense client.
Other Booking Engines Available
Ultimately, most of the “better mousetraps” we are seeing in the industry are essentially booking engines. Most are very slick – slicker than Concur. The user experience, use of Artificial Intelligence, gamification, rebates, and bundling certainly strike a chord with many companies. Still, the majority of these tools are booking engines dependent on modifying user behavior through a single booking source in a social and professional environment where betting on user behavior change in a corporate setting is a tough sell. The changing demographics in organizations today along with myriad of booking options including supplier direct websites should drive entrepreneurs (and investors) to build innovative solutions in addition to “better mousetraps”. I’m not seeing the “vision” here and without it, I believe the investment will have to rely on the sheer size of the market.
The corporate travel industry is poised for another “visionary app” a la Concur, a fundamental change in the way businesses procure corporate travel. And while this change may not be readily apparent among well-established large market travel programs, we have to give credit to the millions of dollars being spent in marketing and technology innovation to create a real offering to the under-served small to mid-market. As with anything, there will be winners and losers but ultimately, I think the big investment push coupled with a renewed focus on risk management as a result of the pandemic will provide a wide opening for truly innovative technology and other industry related solutions.
How CapTrav Compares
Certainly, we believe CapTrav is one of these solutions. By marrying TMC compliant bookings along with all bookings no matter the source, we have essentially removed the user behavior requirement, enabled our clients to leverage the bookings of non-compliant travelers with “any-channel” supplier remuneration deals, and provide comprehensive risk management. Beyond that, CapTrav provides a platform to leverage these benefits for the small to mid-market among those clients who are not formally managed by a TMC, essentially enabling us to compete with the “better mousetrap” booking engines in the marketplace.
Humbly, we think this is “visionary” and believe we are only the tip of the iceberg when we ultimately crawl out of our deep industry hole. By most accounts, corporate travel has a ton of pent-up demand. The novelty of video conferencing business meetings and personal work-outs has worn itself thin. People want to travel. Businesses want to get back on the road. And from what I see as a daily industry observer, corporates are open to fundamental change.
Given the change in company demographics, the pandemic which has hit every one of us in the industry, and the massive investments being made in our industry, I’d bet the farm that we haven’t seen the next big thing in corporate travel yet. But, one thing I’m pretty sure of is it won’t be another booking engine.