Business travel has just about reached its pre-pandemic revenue levels. However, the face of business travel is totally transformed with technology shifting the dynamics as the industry responds, says Ryan Haynes, director of Haynes MarComs
![Guest Post: Business travel is back and corporate customers now more demanding than ever](png/28009_c%3d(0%2c0%2c1200%2c799)_w%3d800_h%3d5333920.png)
Guest Post: Business travel is back and corporate customers now more demanding than ever
Business is finally booming again for those in the business travel supply chain. According to the GBTA’s Business Travel Index Outlook report, business travel spend is set to reach $1.4 trillion this year, climbing to $1.8 trillion by 2027. Having fallen to $661 billion due to the pandemic, this is welcome news.
Some said business travel would never recover, since we all discovered the power of video conferencing and virtual catch ups. But it’s worth remembering that business travel is about much more than this. “Travelling for work is not just people travelling for meetings,” said Clive Wratten, chief executive of the British Travel Association (BTA).
“It’s going to fix things, it’s going to play sports. Some things physically have to happen.”
RBH Management has witnessed significant change in the makeup of its corporate business. “The corporate transient market has changed considerably. Transient Corporate shortfalls are however being more than mitigated by project and group business, where increased demand for team meetings and incentives tends to be growing as a result of sustained remote working policies,” comments Andrew Secker, group director of sales at RBH Hospitality Management.
The evolving face of business travel is fascinating, particularly with the growth of bleisure travel. But the rising demand for business travel is not necessarily easy for the industry to handle.
Employee wellness and sustainability shape business trips
“What we’ve learned from Covid is that corporations are thinking about the duty of care and the wellbeing of their employees,” Wratten said. In fact, many businesses are redefining their business travel policies, with sustainability and employee wellness a key focus. “Duty of care is everywhere now,” said Claire Steiner, the UK director of the Global Travel and Tourism Partnership (GTTP).
“That’s a good thing, but you need to have rules in place.”
RBH Hospitality Management has been investing in sustainability credentials, “priorities are already changing and will need to evolve further and faster to meet corporate ESG goals. Our properties at RBH are all targeted against Green Tourism’s third party criteria and the ability to evidence hotel practices to reduce carbon emissions, which will rightly only increase,” said Secker.
Prioritising employee wellbeing and sustainability is also seeing people take longer business trips. Travelzoo is one company that is rethinking the way staff travel for business. “Our policy has changed – we’re travelling less for business and we’re being a lot more economical about how we travel,” said James Clarke, general manager of Travelzoo UK on podcast the Travel Monthly Review Show.
“But instead of visiting our other offices more regularly, we’re staying for longer when we do go, getting more out of each visit and making it more productive,” he said.
Getting more out of fewer but longer trips is as much about sustainability as it is about wellness, and it’s a topic businesses are becoming acutely aware of. According to Trainline Partner Solutions, 52% of businesses have already set targets for reducing their emissions from business travel, and 82% intend to improve support for employees to choose low carbon business travel options.
Tech and supply chains are a help and a hindrance
Technology has been transformational for the travel industry, but the vast diversity of travel tech is also tricky for travel companies to navigate. “Digitalisation is good, and everyone sees that,” Wratten said. “The issue is the real end-to-end solution. It’s rare. Each [solution] has to be fed into a central API or booking tool, and the sheer spread of the tech is difficult. We now need more tech to pull all the tech together!”
Technology is also enabling business travellers to use self booking tools instead of going through agencies. Although this is liberating, it is also causing difficulties for hotels. “Self booking tools are so important now, but properties need to know how they work, said Daniel Simmons, chief commercial officer of HotelREZ. “There is still bias on what the actual person booking sees. If a property or group has preferred partnerships, kickbacks and high commissions on the TMCs, they will be at the top of the list, even on the self booking tools. They also link to online travel agents (OTAs). You have to be really careful with the cost of sale, it’s hard to know what’s coming from where.”
Jon Siberry, group revenue manager of Sarova Hotels, concurs. “We’ve seen a very sudden and very obvious increase in corporate travel through the OTAs. It makes it a bit of a challenge because the whole dynamic of the booking and payment process is completely different. Now we’re having to get involved in virtual credit cards, corporate payments and submitting invoices. This is extra work hotels are not geared up for.”
While RBH Management has been adapting to changes as the market develops, Secker explains: “The evolution of technology is being implemented at all stages of the guest journey. Commercially, with the tools now available, we’re better able to evaluate client contribution to profitability. Our systems can yield the business more effectively and, with dynamic discount pricing, we can ensure our corporate clients always get the best rate. Our ability to recognise our customer's unique preferences is already well-advanced but the opportunity to further enhance this is an exciting one.”
Industry mitigates challenges
Despite challenges, the fact business travel is returning is a huge boost for everyone involved in this vast industry. Occupancy in hotels is now so good in many city hotels that companies such as Travelzoo are helping their clients on campaigns to drive occupancy at the weekend instead. Clarke said: “If you can stay in a London hotel at half the cost at the weekend compared to a weekday, that indicates the return of business travel.”
Needs and priorities might be shifting, but if hotels and other hospitality providers can meet them, there are also plenty of opportunities. A survey by Uber for Business found that 51% of respondents said that meeting their organisations’ Environmental, Social and Governance (ESG) requirements for more sustainable business travel would also push up spending. Adding in bleisure deals, and enabling blended itineraries and objective stacking, also helps business travellers strike a balance while being more productive for their companies.
“Increased expectations are coming from higher up, such as travel managers and booking managers,” said Jeremy Dowdin, head of sales and marketing of Zetter Hotels. But we know with some certainty what business travellers are ultimately looking for; “Corporate guests need a good bed, water pressure, Wi-Fi and breakfast.”
Whatever the future holds for business travel, remembering the basics is just as important.