“My company makes me book travel through a corporate travel agency or through a corporate online booking tool. But these days, there is so much cheap travel on the Web. I can go to airline sites, hotel sites, car rental sites, last-minute bargain sites, and even sites that search other search sites. I know where I’m going. I know what I’m doing. Why can’t I just book my own travel? Give me one good reason!”
Here are eight.
Discounts: Unless your company is small, it will have negotiated discounts with travel suppliers. Usually, the only way to access these corporate bargains is via the corporate booking channel. For example, if you book as Joe Citizen on an airline Web site, how can the airline apply your company’s discount? Corporate discounts can run well into double figures.
Booking fees: For complicated travel, you still need the human assistance of a travel agent. The fees charged by your company’s corporate travel agency or travel management company are transparent and low. The fees charged by the retail agent at the shopping mall are less transparent and higher.
The cost of your time: I like surfing around travel Web sites. I like comparing airfares and hotels. I like seeing prices and pictures. Everyone needs a hobby. But it’s not good economic use of my time. You are probably costing your company at least $70 per hour, and perhaps much more. Seeing and comparing a wide range of prices and options on various Web sites can take a long time. From the company’s point of view, it is much better for you to send all your travel requirements to a person or a computer that is programmed to do the job for you, quickly and thoroughly.
Safety: You are traveling on behalf of your company. Your company is legally and morally responsible for your safety. It needs to minimize your personal risk in three ways. First of all, the company needs to prevent you from undertaking risky travel. Second, it needs to know your general whereabouts at any given time. And third, should anything happen, it needs to act first, act quickly and get you home safely. The record of your booking through a travel management company reliably provides the necessary information to your employers. Some of you reading this will someday need emergency assistance in transit.
Company travel policy: The company is paying for your travel and has a right to determine the cost. Some let you go first class all the way. Others watch the dollars. Whichever, it’s the company’s decision, and only with a corporate booking channel can it apply booking filters to minimize non-compliance. Your new sales trainee might think he deserves a Garden Suite at the Ritz, but your CFO probably has other ideas.
Supplier management: The various commercial discounts that your company has in place typically require minimum expenditures or market shares. The only way it can track its performance is with the data collected and sorted via a corporate booking channel. Yes, internal systems and card companies can gather data. But the data needs to be consolidated, and it needs to be rich in travel information, not just transactional information. Also, good data allows the company to add up its “bang for the buck” to get best deals in future negotiations with travel suppliers.
Additional value-adding services: Travel management companies market these heavily. Some of their services you can probably live without. But some are of real value, especially when they are already included in lower travel management company booking fees. Useful services include:
- Tracking of unused tickets and credits, minimizing wastage from unused tickets
- 24/7, multilingual, toll-free international booking
- VIP booking services. Bespoke, exceptional service for top executives. (You’ll get there one day.)
Personalized knowledge and advice: The booking consultant at a travel management company should get to know you personally. Assisted by good software, he should develop a rapport and a familiarity with your preferences and patterns. Also, he should be more experienced than his retail counterpart, and provide you with business-smart travel tips and advice. “You’ll get there quicker via Frankfurt.” “That hotel is $40 more, but you’ll save $80 in taxi fares.” And so on. If this isn’t the case, get a better travel management company.
OK, but there are Web-only bargains that I’ll miss out on.
Yes, there are. There have always been specials and bargains flashing on and off in the retail market that corporate booking processes can miss. Many of these specials are now on the Web. But from your company’s point of view, it is the average cost of all travel that counts. There are two reasons why retail travel agents and websites are unlikely to offer the cheaper option, overall.
Travel management company discounts
First of all, there are discounts that they miss. Travel management companies have buckets of discounted airfares and hotel rates based on their large spend with suppliers. They are particularly competitive for international and business class travel. Rather than pan-flashing specials, they are continuously available discounts.
Better fare and rate searching
Second, one of the key features of a travel management company’s booking software is its capacity to automatically search the market place for best fares and rates, wherever they may be. There are many places to go, and the software is stretching to keep up. But good corporate booking engines are still the best searchers in the market place; better than the retail search engines, and better than you or me clicking around on the net.
OK, but I keep seeing cheaper travel on Web sites
Granted. Sometimes you will find unbeatable bargains on the Net. But the corporate prices might be lower than you think. When travel is booked through a travel management company, you might not see all the discounts. There are two types: negotiated discounts, and commissions that the supplier pays to the travel management company and the company then pays to you. The end cost of corporate-booked travel is often lower than it looks.
But watch this space.
The amount of discounted travel available only on suppliers’ Web sites is growing. Airlines, hotels, and car rental firms are promoting their own Web sites by withholding some lower-priced fares and rates for their Web sites only. You would expect them to since Web-direct is a low-cost distribution channel. And airlines in particular need to manage down costs.
Travel booking is pure information exchange, and so travel lies on the frontal surge of Internet commerce. The domain of the travel management company is getting smaller as pricing gets simpler and as software develops. In the future, your choice will be between a corporate online booking tool, retail online booking tools, and suppliers’ Web sites — no manual travel management company services required. But even then, booking direct on suppliers’ Web sites probably won’t be the best option for you or your company, overall.