Tom Wilkinson

President, TRW Travel Consulting, LLC

www.managedtravel.net

Online Strategies for

Travel Programs

Presented to:

PAMPI and PHL BTA Joint Education Institute

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Presentation Goal

Premise: The ‘online strategy’ of most corporate travel programs follows the trend in the travel industry itself -

Implement an OLBT gradually with limited usage Discover the value and ride the wave towards

adoption rates over 50% Look to extend the success in online booking to

other areas of corporate purchasing

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Humble beginnings …

Significant skepticism about online booking

– Technical difficulties

– Travelers and arrangers didn’t want to become agents

– Travel Managers concerned about loss of control introducing new applications always challenging

– Agencies (TMCs) felt they had to re-build every PNR and of course feared loss of market share

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Humble beginnings…

Initial online rates were very small– 5% - 10% considered successful– 30% adoption was ‘best in class’– no standard definition of adoption or success

(fish stories)

Most agencies ‘surcharged’ online booking– $40 + $5– online booking tools were an optional choice for techies

Online tools created ITMCs to overturn agency pricing paradigm

– reflect the lower labor component of online booking and fulfillment

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Humble beginnings…

Integrate with Travel Agencies

Integrate with Travel Programs

Controlled by Travel Managers

Initial focus for OLBT’s ….

Success despite questions from traditionalists…

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Drivers of Success

Agency transaction fees fell– Lower agency fees for ‘touchless’ and ‘light touch’ trx– average about 1/3 – ½ of ‘agent initiated’ fees– TMCs realized their margins could be higher with online trx

Visual Guilt– travelers make better decisions when they have more

information– online booking analogous to ‘parallel’ vs. ‘serial’ interface

Drivers of Success

Travel policy Adoption programs

– started by online tools– now offered by agencies

Online culture; youth culture Industry success

– “if they can do it why can’t we?”

Training (?)Third time’s the charm… !

Drivers of Success

Document aggregated savings in agency transaction fees

Document lower ATP’s online vs. offline– same city pairs

Best Practice: Send reports with total documented savings to executives

– and cost center managers

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Success for Online Booking

All transactions now seen as ‘eligible’ – Mid office processing systems can manage almost any booking – Typical ‘efficiency’ rates over 90%

Online adoption has skyrocketed– Higher ‘all inclusive’ adoption is key metric for many travel programs

Leading online tools report average online adoption over 70% – TMC’s report 80%+ adoption rates

starting at 30% - 50% common– ITMC have guaranteed minimum adoption of 75%– Smaller companies can book 100% online

End of story …………. ?

Mid-Office Differentiation vs. Leisure Booking Tools

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Online Booking Tool

Leisure - Unmanaged

Ticket

Mid-Office Differentiation vs. Leisure Booking Tools

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Online Booking Tool

Corporate/Managed

Passenger

Name Record

TMC

Mid - Office

Back-Office

Ticket• Profile Integration• Priority Preferred Vendors• Rules Based Policy Pre-trip Disapproval

Mid-Office Differentiation vs. Leisure Booking Tools

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Online Booking Tool

Corporate/Managed

Passenger

Name Record

TMC

Mid-Office• Profile Integration• Priority Preferred Vendors• Rules Based Policy

Mid-Office Differentiation vs. Leisure Booking Tools

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Online Booking Tool

Corporate/Managed

Passenger

Name Record

TMC

Mid-Office

• Pass/Fail tests (fare threshold)• Complex International• QC (supplemental policy review

• Profile Integration• Priority Preferred Vendors• Rules Based Policy

Integration of online and ‘offline’ bookings

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Online Booking Tool

Corporate/Managed

PNR

TMC

Mid - Office

Back-Office

Ticket

‘Offline’

CorporateTravel Counselor

Reporting Where to call for help?

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OLBT’s: The Leading Edge

Managed online ‘workflow’ methodology

Online booking methodology extended – meetings management– online marketplaces for travel and ‘travel-ish’ services: video

conferencing, limos, dining, events, shipping

Integration of reservations, meetings management, expense reimbursement, and vendor payments

– closing the loop

Building on the success…

Expanding the Model

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Logical temporal progression but what is the value in fusing the data?

What is the ‘mid-office’ process necessary?

Expense Management

Is it worth all the integration necessary?

Proprietary to Rearden Commerce

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Expanding the ModelExpanding the Model

Building on Success

Remember the lessons

1. It takes time

2. Convince the vendors they will profit

3. Need a policy push

4. Document savings.