The document discusses trends in business travel based on a survey of 1,400 frequent business travelers in 14 countries. It finds that 91% expect to maintain or increase their level of business travel in the coming year, despite economic uncertainties. However, it also notes that the business travel industry is undergoing significant changes, with traditional relationships between suppliers and clients coming under pressure. Companies are increasingly moving to online booking tools to gain cost savings of 15-20% on flights. While airlines are trying to resist this shift, the widespread availability of technology that extracts the best fares is making companies' move to online booking difficult for airlines to counteract.
Discover Mathura And Vrindavan A Spritual Journey.pdf
NYT_Clip_Business Travel 10 08 02
1. BUSINESS TRAVEL: ON THE ROAD; Deep Change Ahead f... http://www.nytimes.com/2002/10/08/business/business-travel-o...
October 8, 2002
BUSINESS TRAVEL: ON THE ROAD; Deep Change Ahead for
Corporations
By Joe Sharkey
SOUTH BEACH is looking a little anxious and tapped out these days -- sort of like a Bourbon Street with better shoes and
haircuts. So it was probably an appropriate spot for a gaggle of travel professionals and writers to gather last week to gaze at
the horizon and speculate.
With a hurricane churning through the Gulf of Mexico far across the cloud-hugged Everglades to the west, while blue skies
and blazing sun bathed the ocean to the east, you could pick up conflicting signals depending on which horizon you were
gazing at. But still, some useful and clear trends seemed to emerge at the two-day gathering, the American Express Global
Corporate Travel Press Forum, which drew business-travel writers from a dozen countries, including a contingent from
China, where business travel is rapidly growing.
Here is the most important highlight that came from these sessions:
Despite souring economies in the United States and elsewhere and despite lingering uncertainty about terrorism, airline-
service deterioration and the so-called airport hassle factor, 91 percent of world business travelers say they expect either to
maintain current travel levels or increase them next year, according to a new American Express International Traveler
Survey.
While some travel companies -- especially some online travel-booking sites -- are notorious for publishing giddily optimistic
surveys based on notoriously unreliable user-generated replies, the American Express survey's methodology looks sound.
Conducted by an independent market research firm, the survey was based on telephone interviews with 1,400 frequent
business travelers -- 100 each in 14 countries in North and South America, Europe and Asia.
''True road warriors, those who travel across the globe, are not slowing down,'' said Mark Webb, the senior vice president for
global business partnerships, who manages the travel and credit card relationships with American Express's top 47
multinational companies.
They are, however, drastically changing some of the ways they arrange and conduct their trips both domestically and around
the world. ''It does appear that a revolution is under way,'' Mr. Webb said.
Obviously, a new terrorism catastrophe or a war in Iraq, will negate predictions of a resumption of robust travel. Right now,
the revolution driving that resumption is being waged on several fronts, and I'll explore some of them more fully in future
columns. But the main forces are gathered on the field where airline prices are set. Everyone I spoke with here agreed that
casualties are going to continue piling up before this industry settles into a new, working model.
''The business-travel industry is currently in a greater state of flux than at any time in my 26-year experience in this
business,'' said Charles Petruccelli, the president of American Express Global Travel Services, which operates the company's
worldwide corporate travel and foreign exchange businesses.
The travel industry was long known for its cozy, cordial business relationships among suppliers, distributors and clients. No
more, he said. ''Traditional relationships are under pressure, and the structure is buckling under the strain,'' he added.
One clear indication of how certain relationships are buckling, a phenomenon that has been addressed in this column
frequently the last 18 months, is the sharp growth in so-called interactive travel booking for business travel. This is a system
in which you arrange all of your own business travel directly on your company's internal travel-booking engine, which is
managed by a third party like American Express, Navigant International or others to squeeze every possible cost-saving and
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negotiated-discount advantage from travel spending, which is one of the biggest controllable corporate expense.
This process typically is automated in a manner that puts pressure on often reluctant employees to adhere to corporate travel
policies, which are partly set based on discounts negotiated for volume use with preferred airlines, hotels and other suppliers.
American Express has been rapidly expanding its operations, called Global E-Fulfillment Centers, to handle these kinds of
bookings, which are now being used by more than 1,400 of its corporate clients. The largest such operation, near Miami,
employs about 250 travel counselors and is open around the clock to handle technical problems and to assist the relatively
small percentage of corporate online users who have extraordinary travel itineraries or needs.
By largely eliminating the personal interaction of travel agent and client and allowing clients to make their own bookings in
a controlled environment, companies routinely save 15 to 20 percent on airline ticket costs.
One of those companies, Motorola, which spent $102 million on plane tickets in 2001, began requiring its employees to use
the internal online booking system for domestic travel last January, said Pam Borgeson, the corporate travel manager.
With 90 percent of bookings done internal and online, travel savings for the first half of 2002 were $4.7 million over 2001,
she said. Much of that came from the greater use of cheaper advance-purchase nonrefundable tickets, which can be more
readily found, booked and managed using online reservations systems designed to extract the best fares under whatever
specific conditions the company requires for its employees.
It does not matter that the airlines are trying mightily to resist this trend, she said. No matter how the airlines try to force
corporate nonrefundable users back into the full-fare category, the technology now available to company travel buyers makes
it a lost cause, she said.
''I don't know any travel manager who is going to pull back and say we're going to start buying full-fare tickets because that's
what the airlines want us to do,'' she said.
Drawing (Chris Gash)
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