How Millennials Are Redefining Business Travel

While they’re more inclined to blend work and play, millennials’ embrace of “bleisure” travel doesn’t have to cost employers more.

How Millennials Are Redefining Business Travel
[Photo: Flickr user ChrisDag]

Who says you can’t combine work and play? Not millennials, at least. Recent research suggests they aren’t the strictly utilitarian business trippers their parents tend to be. While traveling for business, millennials are spending more company money than their gen X and baby boomer colleagues. But before your company puts its expense accounts on lockdown, it’s worth first considering how that trend could be an opportunity rather than a threat.

Enter The High Rollers

Although millennials are frugal shoppersby some accounts, they don’t act like it when they’re spending company cash. An Expedia survey found that 37% of 18– to 30-year-old business travelers spend more on room service when their companies are paying, compared to only 21% of business travelers in the 46–65 demographic. Millennial travelers are also more likely to say they’re entitled to earn loyalty points on business trips. Given the option, they might choose their favorite hotel or airline, even when cheaper options are available.

Other researchers have made similar findings. In a Boston Consulting Group (BCG) study, millennial travelers were 60% more likely to report buying flight upgrades like extra legroom and in-flight entertainment during business trips. In fact, BCG found that millennials spend 13% more on airline tickets than non-millennial business travelers. And considering that the researchers estimate that millennials now comprise one-third of all U.S. spending on business flights, that extra chunk of change is nothing to sneeze at.

But contrary to what the numbers might suggest, millennials aren’t necessarily profligate spenders–they’re value hunters. To a millennial, a trendy, $500-per-night hotel that’s been discounted to $250 is a better value than a $225 room at full price. Likewise, a direct flight for $350 may seem like a better value than a connecting flight for $275. They want the best bang for the buck, rather than the cheapest options available.

Lifestyle Design

In other words, millennials prioritize value and experiences, and they bring this mentality to business travel. Unlike gen X and boomer business travelers who hate leaving home and family, millennials are much less tied down. According to a 2014 Pew Research Center report, just 26% of millennials are married, while at the same age, 36% of gen Xers and 48% of baby boomers were hitched. Not coincidentally, an Urban Institute study found that millennial women are having children at a rate that is “by far the slowest pace of any generation of young women in U.S. history.”

As they are less likely to have responsibilities at home, millennials can approach business travel as a lifestyle experience. In their position, why not hack a grueling travel plan to make it more enriching, rewarding, and–yes–pleasurable?

Enter what some in the travel industry are terming “bleisure” travel (to the dismayed groans of others). At first, “bleisure” only referred to business trips that were extended for pleasure. Now the word encompasses leisure experiences that are woven throughout a business trip.

Here’s an example: I recently heard about a millennial business traveler who booked a hotel 40 minutes away from his destination city, in a ski resort town. He wanted to stay near his preferred CrossFit gym, and he liked the luxe vacation town better than the nearby city where business meetings were to be held. The company would cover his rental car and gas anyway.

Bleisure goes beyond extended trips and posh locations. For example, millennial travelers use Tinder, the dating app, to solicit travel advice from locals and find social opportunities. In fact, the social dimension of travel is so important to millennials that hotel chains are redesigning their properties to meet gen Y demands. Marriott (Moxy), Starwood (Aloft), Hilton (Canopy) and even Virgin Atlantic have rolled out new hotel concepts focused on younger travelers, taking a nod from W Hotels and Kimpton. These millennial digs feature stylish interior design, ubiquitous Wi-Fi, social space, shared workspaces, and creative amenities like free bike rentals and happy hours.

Bleisure Versus Budgets

Are millennials taking advantage of their companies? Not maliciously. All the available research suggests that millennials would continue to blend work and play during business trips even if their companies cracked down. And the hospitality industry has shown it’s eager to help them. This isn’t all bad news for employers.

For one thing, bleisure prevents burnout. Whereas long, frequent business trips are usually considered a burden, millennials are turning them into unique experiences, which makes them more willing to travel for work in the first place. And they’ll be more productive, engaged, and loyal in the long run. As more companies do business with global clients, their travel needs will likely expand. As they do, those employers that embrace millennials’ approach to business trips can turn it into a selling point, giving them an edge on recruiting top young talent.

Finally, while millennials are likelier to spend more on certain travel features, they’re willing to consider a wider range of options that can actually reduce the burden on the companies footing the bill. Because they typically avoid the conventional business travel schedule, millennial travelers are more likely to dodge peak prices. And here at my company Rocketrip, we’ve found that millennials know how to be cost sensitive in other ways when presented with the right incentives.

When they travel on their own dime, for instance, they use low-cost options like Airbnb (which, full disclosure, is a Rocketrip partner) and save an average of $110 per night. So when it comes time for company travel, they’re more open to considering a funky, charming Airbnb than a pricier hotel room. Employers that let millennials weigh these options on their own terms, according to value and experience, might even end up saving money.

Dan Ruch cofounded the business travel startup Rocketrip in 2013. He was previously vice president at Tremor Video Europe, a leading provider of technology-driven video ad solutions. Follow him on Twitter at @DanRuch.

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