Jnews is about news!

Execs Weigh in on Corp. Travel Trends at Phocuswright Conference

Execs Weigh in on Corp. Travel Trends at Phocuswright Conference
Execs Weigh in on Corp. Travel Trends at Phocuswright Conference

As travel industry luminaries and investors gathered in Phoenix this week for the annual Phocuswright Conference, key issues for corporate travel frequently took center stage, including challenges as travel rebounds, a hopeful prediction on New Distribution Capability adoption and the need for corporate travel managers to take the lead on sustainable booking behavior.

Large Corporates Hitting Walls in Price Negotiations

Large corporate travel programs have been surprised by difficulties as they return to the negotiating table with suppliers, Flight Centre Travel Group chief experience officer John Morhous said during a session focused on corporate travel.

“They have an expectation that they have a large spending power and can negotiate big discounts, but they’re just not materializing in today’s world because capacity is constrained and the world is different,” he said. “It’s been difficult navigating that water, which is why you see the SME side rebounding a bit faster.”

While large client “spends are way down,” they still have “sky high” expectations in terms of service, Morhous said. CWT EVP and chief growth officer Belinda Hindmarsh said meeting service needs has “been tough,” but added that “there’s never been a time that the value of the TMC has been higher.”

“If you think about the complexity of travel today and all the changes, someone has to guide travelers to understand how to get from Point A to B, and often it’s not just A to B anymore,” Hindmarsh said. “Trips are getting a lot more complex, and there’s a lot more need for safety and security.”

Sabre Predicts ‘Much More’ NDC Adoption

Sabre Corp. president Kurt Ekert sees higher levels of New Distribution Capability adoption on the horizon as “the technology is finally catching up with some of the aspirations of the last 15 to 20 years,” he said in an interview at the conference.

As frustration with slow NDC adoption levels has grown in recent years, Ekert noted that in the early years of NDC, about a decade ago, the focus was on “the physicality of airline distribution,” putting content through an API interface, but that was only part of the equation.

“What’s been missing, for this to work, if you think about the shopping, booking and post-booking automation flows that a [travel management company] or an [online travel agency] or a corporation needs, that stuff had not been addresses in scale,” Ekert said. “That’s fundamentally the reason it hasn’t been adopted broadly, but we’re solving those things, so whether it’s EDIFACT or an API, the user experience efficiency with corporate travel will be commensurate with what it was before.”

Ekert said he expects “much more” adoption of NDC, though “it requires the corporations, the TMC or OTA, some technology intermediary like us and the airline all to align their interest in terms of how this gets done.”

Searching for Sustainability

Machine learning and artificial intelligence will be the key to driving travelers to make more sustainable booking decisions, Travelport chief product and technology officer Tom Kershaw said.

Travelers in surveys sometimes say they would be willing to pay more for more sustainable travel options, but they still predominantly go for the cheapest and shortest option and ignore sustainability data in the search, Kershaw said. When sustainability scores are supplied, travelers often don’t understand what they mean.

“We’ve seen take up from sustainable travel go from 0 to 4 percent, and then it’s just flat,” Kershaw said.

The key, Kershaw said, will be in search weightings, which still are heavily reliant on price. Emissions data should be one of the “branders” in searches influencing where they appear, driven by artificial intelligence and machine learning. Pushing for that largely will fall on travel managers’ shoulders, he added.

“I tend to discount end travelers when it comes to this,” Kershaw said. “Corporate travel managers are going to drive sustainability. They control the budget, and they have corporate goals to achieve.”

Hotel Service Expectations Evolve

As hotels continue to grapple with labor shortages, service at hotels is returning to a “different but consistent” level, Marriott global officer for global sales, distribution and revenue management Drew Pinto said during a hotels panel at the show.

Pinto acknowledged a “big mismatch” between what travelers were paying in rates and service levels at hotels in the spring, when demand was surging back amid inflation while many hotels were still short-staffed. Today, however, the experience has improved, he said.

“We’ve bulked staffing up,” Pinto said. “We’ve reinstated all of our [food and beverage] requirements. We put our brand standards audits back in, so we’re holding hotels accountable.”

Housekeeping remains one of the most affected areas in terms of service. An American Hotel & Lodging Association survey of about 200 hoteliers in recent months indicated that 87 percent are experiencing a staffing shortage, and more than 40 percent said housekeeping was the biggest challenge in terms of staffing.

Choice Hotels International chief commercial officer Robert McDowell said the company has worked with its franchisees to create “housekeeping on demand,” and the key is to set guest expectations from the beginning. At check-in, for example, guests can know whether to expect housekeeping every one, two or three days. At higher-tier brands such as Cambria, guests are informed about housekeeping regularity by text, with the option to also make special requests by text, he said.

Pinto, who said Marriott has instated housekeeping standards related to the different tiers across its brands, said the company has gotten more creative in its hiring practices, such as offering shared shifts or flexible work hours, to combat the labor shortage. When asked about housekeeping potentially being a revenue opportunity for hotels, however, he gave a direct no.

“We’re not charging for housekeeping, despite many requests,” Pinto said.

Innovation Winners Announced

Honorees in Phocuswright’s Innovation Launch & Summit competitions this year included:

  • Swayed, a software that maps customer journeys at hotels using location, behavioral and transactional data from their devices to allow hotels to better target sales and services to guests, was named most innovative startup of the year as well as the Thayer Ventures Award winner.
  • Nectar, a financing solution for property owners in the short-term rental industry, was the People’s Choice Award winner as well as runner-up for most innovative startup of the year.
  • Tripscout’s @Hotel brand, a hotel booking platform within Instagram, was the People’s Choice Award winner among the Launch entries.
  • Celitech, which enables travel companies to sell co-branded international cellular data plans as an ancillary service, was the runner-up for the Launch People’s Choice Award.

Leave a Reply

Your email address will not be published. Required fields are marked *