www.buyingbusinesstravel.com
Open booking
says: “It is natural that travellers want to use these great new tools that are popping up.”
Loss of overview when travellers use these apps is one of the big worries among travel managers – both in terms of management information and of traveller-tracking, where employers must increasingly show their duty-of-care.
Concur sells a service called Trip Link, which allows travel managers to gather information on spend outside the managed programme – though it says it’s not so much an advocate of open booking, but an enabler of it.
MISCONCEIVED THREAT UBS’s Cuschieri says there is a place for open booking, and the perceived threat to managed programmes is misconceived. “While open booking channels may provide certain benefits, it’s important to appreciate that each company is unique, with its own culture, traveller needs, internal processes and supplier leverage. Each of these characteristics needs to be considered when determining if open booking can add value.” He says there is a big difference between managed open booking and unmanaged travel. “Under a managed open booking programme, travellers have guidelines to abide by. The question is how much room to ‘roam’ do you give your travellers? This will be dependent on the organisation’s culture.” Cuschieri says UBS carries out regular rate parity checks with a number of online booking websites. “We believe the current booking medium – online booking tool and agency – works. However, I’m a firm believer that enabling wider content and choice is a good thing, which could work across secondary or infrequent destinations, with the proviso that we can create a link to our corporate online booking tool.” He says that, in essence, the minimum requirement for a travel buyer or manager is the ability to capture data and the ability to track travellers.
OPEN HOTEL BOOKING Open booking of hotels is where it might all begin for some companies. Research by CWT’s
Travel Management Institute found anywhere between 40 per cent and 70 per cent of business hotel room nights are typically booked outside the travel management company (TMC)/online booking tool channel. A rapid growth in web and mobile booking channels for hotels is also playing a role. Many of the new start-up ventures are in the area of hotel bookings, and the table on p80 shows just some of those that have launched in the past two years. Hotel Tonight, which lets you last- minute book hotel rooms on the same
A rapid growth in web and mobile booking channels for hotels is also playing a role
day only, says that business travellers account for half of all their users. Its app – it is a mobile-only platform – has now been downloaded 8 million times. The company’s managing director
for Europe, Heather Leisman, says: “These are typically interrupted business travellers, people whose plans have changed, and they are booking a hotel for that night. “Most of our business travellers are from small businesses and are unmanaged, but this trend away from: ‘You must book through here’, excites
us. We see a huge opportunity for business travel.” Hotel Tonight operates as a marketplace, with hoteliers setting prices themselves, guided by market makers employed by Hotel Tonight, who make suggestions if a price seems out of kilter. “What we typically see is hotels loading discounts of between 20-25 per cent on the price available on their own channels,” says Leisman. The company believes that its mobile- only, limited-availability business model means hotels are willing to offer discounts above what is available through their own websites and the global distribution systems.
SITE LIMITATIONS
Secret Escapes is probably best known for its TV advertising campaign featuring a pretty young woman whispering seductively to the viewer about the amazing deals the site offers. The site now has a huge number of members and can virtually guarantee to sell large numbers of room nights for hotels that sign up.
The site does not actively target business travellers. Co-founder Troy Collins says: “To be honest, our model is such that I would be surprised if anyone can efficiently book business travel. Our sales only last for seven days and we don’t give any indication
OPEN BOOKING ON TRIAL
Consulting firm Sapient has tested the open booking approach, and found that a more managed solution was consistently better
IN 2008, SAPIENT DECIDED to globalise its travel programme. Senior global travel buyer Michelle DeCosta says: "Prior to then, the travel programme was handled separately by each region and had a large component of people doing their bookings in any manner they chose. In building a global programme with a global TMC, we struggled with getting people onboard with a centralised solution. We decided to allow
people to continue book in the manner they chose, and then did an ongoing analysis of bookings in and out of programme. Those in the programme showed a consistent 15-20 per cent in savings over those outside." Despite this, DeCosta
believes open booking can work for companies that don’t have the volumes to support corporate discounts, but gathering data is a challenge. She does see some advantage
to using the new hotel booking sites. "With hotel demand outpacing supply in many areas around the world, locked-in corporate rates are difficult to negotiate and the percentage of rooms made available at the corporate rate is also decreasing. These lodging sites are providing value. We recently had a demo of Trip Bam [a hotel rate tracking service], which could be a game changer in hotel bookings for our people."
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CASE STUDY
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