L’impact des organisations internes sur les comportements des achats voyages

The impact of internal organisational models on travel purchasing behaviour

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The impact of internal organisational models on travel purchasing behaviour

In 2013, Egencia carried out a study among its clients in Europe and North America in order to analyse the impact of internal travel management organisational models on purchasing behaviour. The results of the study show significant differences between the two continents in terms of how companies manage travel booking. In Europe, two out of three companies centralise their reservations through travel arrangers or internal travel services, while only one out of three companies do so in North America.

This report looks at how these trends can impact companies and the buying behaviour of those responsible for booking business travel.

SOME DEFINITIONS

This study looks at two types of travel bookers:

• Travel arrangers: make more than 50% of reservations for others. • Self Bookers: make the majority of their reservations themselves.

The two organisational models for managing business travel that were examined in this analysis include:

• Centralised: Over 60% of reservations are made by travel arrangers or internal travel services.• Decentralised: Less than 40% of reservations are made by travel arrangers or internal travel services.

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70%70%

40%

WHAT IS THE RIGHT CHOICE FOR COMPANIES?

In Europe, nearly 70% of companies located in only one country including SMEs and large companies centralise their travel bookings with travel arrangers compared to only 40% of multinationals. In the UK, the percentage of companies with centralised booking is overall slightly lower (60%) than the EU average.

Companies with operations in several different countries tend to decentralise their travel purchasing more than companies operating in only one country: the more a company is spread out geographically, the more it decentralises its booking, with more of the travellers booking travel for themselves.

Across the Atlantic, the trend towards decentralised booking is even more pronounced. In North America, 70% of companies based in one market decentralise the management of their business travel and in multinational companies 100% of reservations are made by self-bookers.

Why do European companies centralise the majority of their reservations with travel arrangers? What are the different advantages of the centralised model and the decentralised model?

In Europe, nearly

of companies located in only one country centralise their travel bookings with travel arrangers compared to only

of multinationals.

In North America

of companies decentralise.

70%70%

40%

Centralised vs Decentralised booking: What is the right choice for companies?

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Centralised Model: Travel arrangers at the heart of travel

THE CENTRALISED MODEL PUTS TRAVEL ARRANGERS AT THE HEART OF BUSINESS TRAVEL MANAGEMENT

In Europe, travel arrangers make an average of 64 reservations per year, 7 times more than a self-booker. In the UK, they book 6 times more than a self-booker.

Travel arrangers often make reservations for travellers who do not have direct contact with the travel agency. The result is that 50% of European travellers and 40% of travellers in the UK have no contact with external travel consultants.

The study also shows that as soon as travel arrangers start using Egencia’s online booking tools instead of making arrangements by phone or email, they quickly reach a point where over 80% of the reservations they make are done online.

We also see that travel arrangers have slightly better advanced booking habits than self-bookers, booking travel on average one day sooner than self-bookers. However, travel arrangers make twice as many cancellations compared to self-bookers.

Whether a company centralises its reservations through an arranger or relies on travellers to book for themselves, the mix of air, hotel, train and car reservations made are identical in both models. One difference can be found in the type of rate used in each case. Travel arrangers tend to reserve more “fully flex” flights (refundable and exchangeable without fees) than self-bookers do. Self-bookers reserve 40% fewer “fully flex” tickets than travel arrangers, and 50% more no-cancellation and non-refundable tickets.

Finally, looking at hotel reservations, 75% of those made by travel arrangers are for preferential rates that offer value-added services (Wifi, breakfast, parking).

KEY LESSONS:

First of all, travel arrangers prioritise their choices in order to to meet the expectations of their travellers. Therefore, travel arrangers need flexibility in order to meet a variety of needs: demanding or VIP travellers, complex itineraries, or more simple trips taken on a regular basis. This requires excellent communication on the level of flexibility that travellers are ready to accept.

“ Travel arrangers favour solutions that offer comfort and value-added services to make up for the lack of visibility on the preferences of their travellers.

”

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Centralised Model: Travel arrangers at the heart of travel

This is why arrangers often adopt a Total Cost of Ownership approach (TCO): they choose tickets that may be refunded or modified free of charge in order to avoid losing the entire cost of the ticket due to unexpected changes. This is because they may not always know how flexible their travellers’ plans are. Travel arrangers are often expert buyers and know that advanced booking can save money. They take advantage of this more often than self-bookers and are active in the search for cost-efficient business travel solutions.

Online booking is very popular among travel arrangers. It would seem natural to assume that travel arrangers would delegate the task of searching and booking travel to an external travel agent given the volume of transactions that they handle compared to self-bookers. However, the study shows that online booking tools are quickly adopted when travel arrangers find them to be useful. Since online bookings generate lower fees than agent-assisted transactions, this creates savings on the overall travel spend. Moreover, online booking offers the same control and transparency that leisure travellers enjoy with consumer online travel tools. Although travel arrangers often acquire a professional level of expertise through managing high volumes of transactions, they benefit from the same advantages as self-bookers when using “consumerised” business travel tools.

Travel arrangers offer an added level of service to their travellers by favouring comfort and value-added services such as prepaid hotels, breakfast and free wifi when making purchasing decisions for business travel.

OUR RECOMMENDATIONS:

In a centralised model, we recommend the following best practices for companies and internal travel services. First, travel arrangers are central to travel policy and optimisation strategies for enterprise purchasing. They should be involved in travel policy design because they are an important point of reference for change management, travel policy enforcement and control. Many European companies can leverage the travel arranger’s expertise in travel management, purchasing techniques and the use of online booking tools to improve purchasing performance for business travel.Consumerised booking tools are more easily adopted by both travel arrangers and self-bookers. This can help companies

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consistently communicate their travel policy to both groups and ensure compliance through features such as automatic indicators displayed on non-compliant options and alerts to managers when any non-compliant reservations are made.

Travellers should be encouraged to let their travel arrangers know their preferences, expectations and whether their plans are flexible or not. This may change with each trip, for example, a trip to finalise an important negotiation may require more flexibility than a trip to attend a regular internal meeting. Online tools can help travel arrangers make the best choices by keeping track of the habits and preferences of their travellers. When searching for the best value-added services, travel arrangers need the most robust inventory possible. For more demanding travellers or group events, they may also require access to VIP customer service and meeting and incentives planning.

Whereas travel arrangers are central to a successful managed travel programme, optimising the traveller’s experience is key to getting the most out of a company’s travel spend. However, the traveller who relies on a travel arranger for booking may not have direct access to the travel agency. For this reason, a travel management company should maximise communications between travel arrangers and travellers.

With the right travel management system, traveller arrangers can seamlessly transfer itinerary information to travellers with automatic itinerary updates to the traveller’s electronic diary. The information is available instantly without having to exchange emails or printing out itineraries. During their trip, travellers can use modern mobile applications for last-minute reservations and 24-hr customer service in case travel plans change. These tools can smooth out the business travel experience and help travellers focus on getting the most out of their trip.

Centralised Model: Travel arrangers at the heart of travel

“ 40 % of travellers in the UK have no direct contact with their travel agency. Mobile solutions will help the travel arranger better serve their travellers when they are on the road.

”

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A DECENTRALISED MODEL CAN ENCOURAGE TRAVELLERS TO BE AUTONOMOUS AND RESPONSIBLE WHEN PLANNING AND ORGANISING THEIR TRIP.

In Europe, 30% of companies decentralise their reservations. These companies are mostly multinationals or large companies that have a large number of travellers. In Europe, this represents one out of every two travellers.

“Road Warriors” are travellers that make over three reservations per month. Self-bookers make up 75% of these high-frequency travellers.

Online booking tools are equally popular among self-bookers as they are among travel arrangers. Self-bookers are quick to adopt online booking and use them for over 80% of their reservations.

Concerning buying behaviour, self-bookers cancel two times fewer reservations than travel arrangers and reserve 40% fewer “fully flex” tickets that can be modified or cancelled without fees. They also book 30% more no-cancellations and non-refundable tickets than assistants do.

KEY LESSONS:

The more travellers travel, the more likely they are to be self-bookers. Making efficient, familiar booking tools available to these travellers as part of a managed travel programme can help encourage them to consistently book travel that complies with company policy. These tools can be adopted naturally and quickly and accelerate savings on travel spend. Travellers are completely autonomous to easily and quickly book travel that meets their needs.

Because they know their schedules and imperatives better than a travel arranger might, self-bookers reserve fewer “fully flex” tickets and more restricted fares. They are more able to accept the risk of buying a restricted fare since they can better gauge how flexible their own travel is. They can also make the decision to book a lower standard of hotel if it offers a better location. A travel arranger might not take that risk when

“ Self-bookers cancel half as many reservations as travel arrangers because they are more aware of their schedules and level of flexibility.

Decentralised Model: Autonomous and responsible travellers

”

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Decentralised Model: Autonomous and responsible travellers

they do not know what the traveller’s priorities are.

OUR RECOMMENDATIONS:

When a company operates a decentralised travel purchasing model, its TMC should give travellers freedom and be able to reconcile their expectations in terms of comfort and choice with the company’s requirements for optimising travel spend. Their online booking tools should be easy to use, provide a full array of travel options and integrate seamlessly with customer service.

Training a large number of travellers on new systems and booking tools can be a lengthy and costly process. Therefore, any new travel management tools should be intuitive and easy to use for a rapid and natural adoption. In the case of self-bookers, traveller satisfaction and end-user experience is essential. By using a travel management tool that is pleasing and familiar with what the user already knows and uses to book leisure travel, self-bookers will be encouraged to book within company travel policy, and therefore reduce the cost of their travel.

Providing relevant booking channels (travel consultants, website, mobile applications) and an inventory that offers val-ue-added services to business travellers are also key in a decentralised model.

In order to build traveller loyalty for online booking tools, we also recommend that TMCs provide mobile tools that can act as a personal travel assistant on the road. Modern business travel mobile applications offer quick access to itineraries, travel consultants and last-minute hotel bookings.

“ Access to pertinent booking channels (customer service, online self-booking, mobile apps) and an inventory that offers value-added services are key to the success of a decentralised model.

”

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WILL THE DECENTRALISED MODEL EVENTUALLY PREVAIL?

In North America, 70% of companies decentralise their business travel and among multinationals, this figure reaches 100%.

Does the decentralised North American model offer a vision of the future for Europe? There are three trends that can help evaluate this possibility:

Economic trends: the study shows that the more a company operates in several countries, the more it decentralises its business travel (60% of European multinationals decentralise their spending compared to only 30% of national companies). With globalisation, more and more European companies are developing their activity abroad, which could drive them to adopt a more decentralised purchasing model.

Generational trends*: Since Generation Y travellers make 42% more business trips than the 46-65 year-old group, this generation will likely shape the future of business travel. This generation is in essence “digital” and relies heavily on the Internet for many services, including travel reservations. Their expectations are higher in terms of web services, mobile applications, connection speed and above all personalisation. When they access an online service, they are used to being recognised by name, having access to their preferences and user history, and seeing millions of results filtered and offered up based on this personalised connection. The Y Generation wants control and the ability to make decisions for themselves. They seek autonomy and do not perceive service as coming from someone, but from something. Technology, especially mobile, is the “personal assistant” of this age group. Indeed, more than any other age group, Generation Y travellers use their smartphones to organise and book trips. They also want to be able to manage both personal and professional travel easily. Considering that 54% of them have already extended a business trip for personal travel, it is likely that these booking habits will follow these travellers into the professional sphere.

* Data from the 2013 Egencia/Expedia study “Future of Travel”.

Will the decentralised model eventually prevail?

“ For the Generation Y, service is not receiving help from someone, but from something. For this generation of travellers, their mobile device is their “personal assistant”.

”

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Technology trends*: 75% of business travellers use smartphones for both personal and professional reasons during their trips, and 40% use smartphones or tablets to book travel. The increasing importance of “consumerisation” and “Bring Your Own Device” (BYOD) policies are further evidence of travellers’ expectation of autonomy.

At Egencia, these three trends mean that European companies will be more and more likely to adopt a decentralised model for travel purchasing. TMCs must prepare for the future by offering multi-platform services that provide contextualised, personalised solutions that are available to travellers whether they are on the road or at their desk. These tools must also be fast, flexible and give bookers easy access to a full range of global travel content.

* Data from the 2013 Egencia/Expedia study “Future of Travel”.

Will the decentralised model eventually prevail?

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Conclusion

The centralised model favours personalised assistance to travellers whereas the decentralised model tends toward an optimisation of travel spend. Companies must examine their specific needs in terms of travel management. A centralised model would suit a business where travel arrangements are often complex and travellers require the assistance of a travel arranger because of this complexity. A decentralised model would better suit companies that have higher volumes of standard, simple trips. It may be that one company operates both models. For example, sales teams with remote territories and VIP travellers would rely on a travel arranger to organise their travel, while technical teams that visit the same sites on a regular basis might prefer having the autonomy to book their own travel based on their habits and preferences. As a travel purchasing model, decentralisation is gaining traction in Europe. TMCs must be prepared to help their clients navigate this shift by offering relevant solutions and services to meet the changing needs of travellers as they evolve according to current and future economic, generational and technological trends.

Methodology This study used data from the analysis of transactions for 5,190 Egencia clients from 13 countries: Germany, Belgium, Canada, France, Spain, USA, India, Ireland, Italy, Poland, UK, Switzerland, and Turkey.

About Egencia Egencia is a leading full-service travel management company delivering innovative business travel technology and expert local service to more than 10,000 clients in over 60 countries around the world. As part of the Expedia group (NASDAQ: EXPE), one of the world’s largest travel companies, Egencia provides forward-looking enterprises with the ability to drive compliance and cost savings in their travel programmes, while meeting the needs and the expectations of the modern business traveller. For more information please visit us at www.egencia.co.uk or connect with us on Twitter @Egencia_UK.

© 2014 Egencia, LLC. All rights reserved. Egencia and the Egencia logo are either registered trademarks or trademarks of the Expedia group in the U.S. and/or other countries. Other log-os or product and company names mentioned herein may be the property of their respective owners. CST # 2083922-50. 

Graham Kingsmill, Managing Director of Egencia UK:

“ Whether booking is centralised with a travel arranger or travel service or made directly by the traveller, our online solutions are used for more than 80% of our customers’ transactions. Intuitive tools, designed according to consumer-grade standards for speed and ergonomics give our users a booking experience that is unique in the business travel industry.

”

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