The Business of Travel

rss

The Official Blog of the Global Business Travel Association


U.S. Travel and Tourism Advisory Board at Work

This week, I participated in a Board meeting for the U.S. Travel & Tourism Advisory Board (TTAB).  As you may remember, I was appointed to serve on the TTAB on behalf of GBTA earlier this year.  During the meeting, four subcommittees made recommendations to the Board based on our last few months of research and work.

TTABpic1

As a Data & Statistics Subcommittee co-chair along with chair Dean Runyan of Runyan Associates, we put forward recommendations related to international travel to the United States. A few simple, but critical facts to help understand why this is so important:

  • $890 billion is spent on travel and tourism in the United States
  • Almost 25 percent of this is attributable to international travel
  • This international travel directly supports 1.2 million American jobs

TTABpic2

In order to continue to grow these impressive numbers even further, we need to collectively do a better job of gathering data, measuring our effectiveness and directing our industry’s collective marketing power.

Our subcommittee focused on improving the U.S. Commerce Department’s Survey of International Air Travelers (SIAT). The SIAT is already widely supported as our government and the industry rely on the data from it to tell its story, make decisions and show a return on investment to all of its constituencies. This primary research is vital to all of the States, destination marketing organizations and businesses that are dedicated to and investing in this industry.

With just a modest investment to the SIAT, we could increase the sample size of international travelers surveyed. Our goal is to take it from the current sample of 0.2 percent of international travelers to 1.0 percent. This small leap could make a real difference.

We are hoping to protect the existing $2.0 million that is allocated to the SIAT and invest an additional, modest $1.5 million to further fund the study and test the recommendations to optimize the way we gather this critical data. This improved research and collection of information will allow the U.S. to better promote itself as a prime destination for business and leisure travel.

The outcome will be dramatic in its long term effect to grow not only travel and tourism, but the U.S. economy at large.


Week In Review

We kick off this week’s news highlights with some positive news from a GBTA study released this week showing that most travel managers (72 percent) are satisfied with their salary. Average total compensation rose 6 percent year over year and the study also showed that travel managers enjoy significant benefits.

TotalCompRanges

Late last week Frequent Business Travel reported on United’s changes to their mileage program and their announcement of additional requirements for elite status. In related news, Scott McCartney of The Wall Street Journal’s Middle Seat blog shared how frequent fliers are hunting for loopholes in new mile award programs.

Delta confirmed this week that it will go with Airbus in a big 50-jet order according to USA Today, which also reported that Airbus will deliver its first A350 in mid-December. Also in aviation news this week, The Hill’s Keith Lang says the Federal Aviation Administration is touting its NextGen implementation in Texas.

JetBlue joined the majority of U.S. airlines this week when it announced it will start charging customers to check bags. Southwest remains the last big airline in the U.S. to hold out on this front says USA Today. Just how much do airlines make from ancillary fees like checked bags? Peter Greenberg’s blog breaks it down by airline.

On the hotel front, Hugo Martin of the LA Times reported that more hotels are going green and it’s not just to save water or money. He cites a GBTA study that says the percentage of companies with travel booking policies that either require or recommend that a hotel adopt "sustainability" measures has jumped to 19% in the U.S., up from 11% in 2011.

Amazon is also getting into the hotel game. Skift reports that Amazon.com is poised to launch its own travel service, featuring booking at independent hotels and resorts near major cities.

In other news, GBTA also announced several awards this week that were presented at last week’s GBTA Conference 2014 Berlin. Volvo, Scandic Hotels, Portman and Scania were presented with Project ICARUS bronze trophies as winners of the second European Sustainability Outstanding Achievement Awards. Mark Cuschieri, Executive Director, Global Travel Lead – UBS,  was awarded the 2014 Luoma Award.

That’s a wrap for this week. The Week in Review will take next Friday off, but will be back in two weeks keeping you up to date on all the latest in business travel.


Week In Review

It was a big week for business travel in Europe as GBTA along with German business travel buyer association VDR kicked off Europe’s largest business travel conference in Berlin. The GBTA Foundation released the results of its semi-annual Western Europe business travel forecast there predicting 4.9 percent growth in business travel spending in 2014 followed by another 6.6 percent in 2015. European economies appear to be stabilizing and bouncing back. Also at the conference, GBTA’s Paul Tilstone announced plans to further solidify relations between airlines and travel buyers with the introduction of the Berlin Charter.

Looking to do business in Europe? Travel Daily News shared the most popular business hotels in Europe.

Keeping with the global theme, President Obama this week announced a deal with China to extend visas for short-term business travelers, tourists, and students – a policy CCTV calls a potential boon to the U.S. economy.

Forbes unveiled its list of the 50 most influential CMOs. The award recognizes the accomplishments of the top CMOs around the world, ranked by influence, how widely their opinions travel and how much reaction they generate when they speak. Best Western’s Dorothy Dowling made the list as travel was well represented. In addition to Dorothy, other recipients in the travel industry included Kevin Krone (Southwest), Stephanie Linnartz (Marriott), Andrew Nocella (American Airlines) and Jennine Haas (Avis Budget Group).

Dorothy Dowling of Best Western International

Dorothy Dowling of Best Western International

In aviation news, Time Inc.’s Money magazine reported on Virgin America’s IPO this week calling it the greatest airline you’ve never flown. According to the New York Times, Virgin America raised nearly $306 million, meeting expectations in its initial public offering on Thursday.

In a USA Today interview, outgoing TSA chief John Pistole talks about enhanced security, PreCheck and tips for his successor. USA Today also outlined five myths about TSA.

TSA Administrator Pistole Talks with Mike McCormick at GBTA's 2011 Convention in Denver

TSA Administrator Pistole Talks with Mike McCormick at GBTA's 2011 Convention in Denver

What should you expect from the airports as the holiday season approaches? The LA Times reports that Orbitz is predicting LAX will be the busiest U.S. airport over Thanksgiving followed by O’Hare, JFK, San Francisco International Airport and Boston Logan International. The bottom line whether you’re traveling for business or pleasure around the holidays – you should probably expect increased traffic at the airports.


Technology is Transforming the Role of Travel Managers

Last week, the GBTA Foundation released a study that showed technology is poised to transform the role of Travel Managers within the next three to five years. Currently, Travel Managers find that tactical tasks – managing vendor relationships, developing and monitoring programs and policies, etc. – dominate their current responsibilities. Thanks in part to technology and its streamlining and automating ability, Travel Managers expect their position to shift to a more strategic role.

The study, “A Day in The Life: The Role of Travel Managers,” sponsored by Sabre Travel Network, surveyed more than 700 North American and European Travel Managers and looked at the role of the Travel Manager, the value these managers bring to their organizations and a potential evolution in their role in the near future.

Travel Managers often find themselves pulled in several different directions at once. At present, procurement-related activities dominate their daily responsibilities, including evaluating and negotiating with preferred travel service providers and obtaining and managing contracts with their providers. Travel Managers also are frequently responsible for activities related to managing internal and external stakeholder relationships, developing and monitoring programs and policies, as well as other areas such as evaluating technology solutions and applying business analytics.

SabreBlogPostPic1

Within the next three to five years, Travel Managers expect to see an increasing reliance on technology and, consequently, using data and analytics to make decisions.

This doesn’t surprise us. Technology has transformed many industries already, automating and streamlining processes.

Technology will allow Travel Managers to expand their role and further demonstrate their value. This includes calculating company savings, a task Travel Managers are often asked to do, but currently find to be difficult and ineffective.

Travel managers also expect further globalization of travel programs and an increased focus on safety and security. This stems from our changing society and reacting to it.

SabreBlogPostPic2

As part of the study, Travel Managers were also asked their biggest challenge at their job. The majority responded with “travel policy compliance,” both in ensuring that the travelers follow company policy as well as obtaining senior leadership buy-in for policies. Additional common problems include keeping costs down, managing globalization, using data to direct decision-making, and keeping up with technology advancements available for travel.


Week In Review

The Week in Review keeps you up-to-date on the latest business travel news. We had some technical difficulties on Friday, but we're back today with the latest in business travel news. Check back again this Friday for another wrap-up.

The U.S. tightened security requirements for travelers from Europe and Asia on Monday. According to Reuters, visitors from countries in the Visa Waiver Program must now get approved through an online system. They will need to provide additional information, including other names they use, parents' names, national identification number, contact information, employment information and city of birth.

This week, the GBTA Foundation released two new studies: one on the costs and savings of a managed travel program and the other on the role of a Travel Manager and expected changes. We found that technology was transforming the role of the Travel Manager by automating processes.

If you’re a business traveler looking to keep expenses down, Nancy Trejos of USA Today looked at the creative ways some road warriors are cutting costs. Some are using their own frequent-flier miles, while others are staying at Airbnbs for a fraction of the cost of traditional hotels. The Financial Post’s Kristine Owram reported on a recent survey of Canadian travelers which found that while 90 percent prefer to fly business or first class, 80 percent are actually flying economy.

The savings from using Airbnb and frequent flier miles will come in handy after you’re asked to pay extra for your checked luggage. Ancillary airlines fees – fees for extras, such as food on board and checked luggage – are expected to generate an all-time high of $49.9 billion in revenue worldwide, according to CNBC’s Phil LeBeau. This is a 17.2 percent year-over-year increase. On average, passengers will pay $15.02 per flight in ancillary fees.

Meanwhile, Emirates CEO Tim Clark told Buying Business Travel he expected free onboard Wi-Fi to become standard on full service airlines within a few years. Currently, technical limitations, including speed and bandwidth availability, stand in the way. According to Clark, Emirates is spending more than $20 million USD a year to install and operate in-flight connectivity systems.

Hotels are developing high-tech, “boutique” hotel brands to capture the highly coveted millennial business traveler demographic, who are expected to make up half of all business travelers by the end of the decade. Yahoo’s Sid Lipsey reports that Hilton has announced plans to open a new line of hotels called Canopy. Each location will be uniquely decorated and designed to match their specific neighborhood, offer free Wi-Fi and artisanal breakfasts and allow travelers to use their smartphones as room keys.