Spend management

It’s all different now. Business travel. Travel managers’ roles. Traveler experiences. All changed. Your approach must change, too.

New ways of thinking can help transform travel programs. Review supplier partnerships; examine air, hotel, ground and rail programs with a fresh eye; and don’t ignore the data.

Looking deeper into data can answer a few key questions, like: What is my essential travel? Did my traveler purchase behavior change in the wake of changing supplier health & safety protocols and more flexible pricing? Were my travelers compliant with policy changes, travel restrictions, preferred booking channels and preferred suppliers?

New stakeholders may emerge – other business units from HR to IT now have a vested interest in travel. Engage with your internal stakeholders to build a recovery path scenario since travel footprint is always related to company activity. Map the changes that will affect your footprint and factor in other organizational changes that will affect your travel policy. These could include shifting from air to rail travel, and focusing on reducing CO2 emissions, to name a few. A great approach is to use “what if” scenario modeling tools to forecast spend and map out a range of scenarios from conservative to aggressive, based on the speed of recovery and recovery start date. That way, you’re ready to activate your program as soon as the business need arises.

Air programs

In 2020, global air passenger traffic fell by 66% compared to 2019, marking the sharpest traffic decline in aviation history. Domestic markets are already on a steady recovery path. Aside from a handful of leisure destinations, international markets are still struggling due to the inconsistent pace of vaccination from one region or country to another. It’s likely that international air travel recovery will be largely dependent on globally accepted digital vaccine passports.

Many airlines restructured in the pandemic. Only a handful of mergers have been announced so far, but further consolidation can be expected. During this recovery period, airlines will likely operate with smaller networks and reduced schedules for the foreseeable future. Most airlines have been offering new promotional incentives and greater flexibility to help revive air travel and to stay competitive throughout the downturn. Post-pandemic, travelers can likely expect higher fares and fewer options.

How can you prepare for the new air industry landscape?

Start with assessing the level of risk with both preferred and non-preferred carriers. Look at risk of grounding, their cash availability, government support, and network impact due to border closures and safety regulations.

During this period of slow recovery, some preferred suppliers may no longer have the capacity to fully cover travel needs in certain markets. You’ll need to adapt your travel program and potentially seek alternative suppliers. Using a tool like Advito’s Air Fare Predictor will enable you to monitor the evolution of bookable flights, seat capacity changes, and future pricing points on a daily basis.

As you craft your ramp up strategy, align your global travel footprint with the changed industry landscape to secure optimal coverage and competitive pricing as the program is gradually rebuilt. This will require ongoing negotiation with suppliers to protect your top routes from volatile or uncompetitive pricing.

Beyond savings, you can ask airline partners how they can contribute to mutual success by being easy to do business with. If necessary, add additional negotiation points around refunds, credits and vouchers – and advocate for fuel surcharge and distribution surcharge termination. Review health and safety measures to help travelers gain trust in air travel, and most importantly, do not use the traditional air RFP process. Agility will be a key factor to success for travel programs in a post-COVID-19 world.

Hotel programs

The hotel industry has certainly changed as a result of COVID-19 and, in some ways, permanently. Heightened cleanliness protocols may be here to stay. As we get back to travel, it’s important to retain our former context while integrating the new.

A good place to set the stage on where to start is the topic of traveler safety and duty of care. If you let this topic guide your strategy, you will not only successfully get back to travel but you’ll evolve your hotel program management in the process.

Duty of care can only be provided if your travelers book their hotels in channels to which you have visibility. It’s more important than ever to make those booking channels intuitive to use, with modern visuals and full of the great content they expect to see.

With that comes an efficient way for your travelers to assess the cleanliness and safety protocols available at the hotel and in the destination to which they are traveling.

For managed hotel programs:

  • Rollovers from 2020 to 2021 will be expiring again and the amount of travel that comes back by Q3/Q4 will dictate what approaches will be taken for 2022 programs.
  • We’re hopeful that meaningful analysis and right-sizing of hotel programs will take place. Depending on anticipated future travel levels, most client programs will be in a position to consolidate down to fewer hotels.
  • Regardless of what eventually happens with the negotiated program, the advice we gave a year ago still stands - now is still an ideal time to get your tools ready for the return to travel.
  • Update your OBT and add rate targets.
  • Devise your Health, Safety and Duty of Care Strategy.
  • When building your timeline to refresh your negotiated program, launch when you have a clear picture of what volumes you will have next year.
  • Most important - don’t think of the RFP process as a traditional approach. Be dynamic with your requests. It’s not just about sourcing anymore, be active in your hotel category management on an on-going basis

Top hotel concerns for business travelers

Surveyed business travelers said they’re most concerned about cleanliness, touchless check-ins and mask protocols at hotels.

Source: BCD Travel Research & Intelligence online survey of 1,260 business travelers, May 2020.

Enhanced cleaning

Online check-in and digital room keys

Face masks for guests and employees

Build Back Traveler Confidence with StaySafe

The best option to drive traveler trust in your hotel program is to use a third-party provider to certify that hotels are taking measures to ensure the health and safety of their guests.

We’ve partnered with StaySafe Hospitality to provide a self-assessment tool and StayClean Certification for hotels to demonstrate the measures they’re taking and compare them against international and regulatory standards. StaySafe has reviewed each stage of the hotel guest life cycle to create a thorough assessment of hotel practices across the property and organization.

The assessment and certification framework also covers hotel employee health & safety requirements to protect hotel employees from contracting COVID-19 or other potential viruses.

Read the fact sheet to learn more about how the assessment and how it works.

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Ground transportation program

Business travelers are changing their habits. Instead of taking public transportation, they are opting for rental cars or personal vehicles. Many are opting to use ground transportation on routes they’d normally fly.

When considering your ground strategy, you can anticipate a substantial increase in volume, which in turn will increase your leverage to negotiate with suppliers. While rates may be negotiable, duty of care and health and wellness are not. All suppliers – including any ground transportation – need to be thoroughly vetted. Review safety protocols and develop a process to verify them for every trip. Each risk factor should be reviewed in this analysis. Is your supplier financially stable? How often are drivers being tested for COVID-19? What do travelers need to feel safe?

For expanded coverage on ground, see the recently published

"Ground Insights"

article from Advito.

When considering your ground strategy, you can anticipate a substantial increase in volume, which in turn will increase your leverage to negotiate with suppliers. While rates may be negotiable, duty of care and health and wellness are not. All suppliers – including any ground transportation – need to be thoroughly vetted. Review safety protocols and develop a process to verify them for every trip. Each risk factor should be reviewed in this analysis. Is your supplier financially stable? How often are drivers being tested for COVID-19? What do travelers need to feel safe?

Webinar

In conversation with National Enterprise on the road ahead

New patterns in ground transportation have emerged during the pandemic. Travelers are willing to drive longer distances, and they desire low-touch and contactless experiences.

Learn how business models have adjusted to changing traveler behaviors; the positive impact safety protocols have had on innovation; and how you and your travelers can prepare for what’s to come.

Rail

Business travelers’ tolerance for taking longer train trips has increased since the onset of the pandemic. Combined with expanding corporate sustainability initiatives, and the rapid growth of rail networks globally, we expect high-speed rail (HSR) to play a larger role in business travel programs.

Advito, BCD’s consulting arm, has launched a new rail practice to help travel managers maximize the benefits of HSR in their travel programs. Taking a multimodal approach by integrating air and rail will identify missed savings opportunities and put pressure on air suppliers to provide better deals. It will also capture opportunities for more sustainable travel by identifying routes where travelers can switch to rail to reduce carbon emissions.

  • Attractive fares and convenience In general, HSR pricing is competitive. Adopting a multimodal approach will increase competition in your program – particularly for short-haul domestic and regional trips – and create leverage to negotiate better deals from airline suppliers to drive down overall spend.
  • Sustainability Rail is generally considered the “greenest” way to travel. Integrating rail options in your supplier mix will go a long way in contributing to your organization’s overall sustainability initiatives.
  • On-board experience Travelers perceive a number of experiential benefits, such as easier social distancing, freedom to walk around, and quiet cabins with fewer disruptions. Rail travel also brings another big benefit to travelers – increased productivity time. On a short-haul trip (under 1,000 km), productivity time represents two-thirds of the total trip duration (vs. one-third with a plane and one-fifth with a car).

Webinar

Step up your game: Supplier changes & Sourcing trends

The travel supplier landscape has changed, and buying priorities have shifted, revealing new requirements, risks and opportunities. Learn how to engage with both new and established suppliers; consider what additional factors should be examined in evaluating air, hotel and car categories; and understand how trends like virtual work and the rise in popularity of travel by car affect sourcing.

What you can do

Spend management checklist

What BCD Travel is doing

Offering flexible rates on hotel bookings to accommodate trip changes

Working with travel managers to review supplier programs and make meaningful changes

Increasing cashflow with various reclaim and refund options

Consolidating information into clear actionable insights

Communicating supplier health and safety policies and requirements

Health and safety measures have top priority for travelers throughout their journeys. Incorporating these into sourcing strategies is key to building confidence.

—Jorge Cruz

Executive Vice President, Global Sales and Marketing, BCD Travel

Travel policy

How to prepare your travelers for when travel returns

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