2012: Travel Management Indentity Crisis

Buzzwords in travel management in 2012 included Google, Concur Open Booking, fragmentation, direct booking and manifesto. All of these words, and the concepts behind them, contributed to an overall identity crisis across travel management that had travel agencies, travel buyers, travel associations and pretty much everyone on the defensive.

What was the value of travel management?

Even a Global Business Travel Association survey of more than 1,700 travelers published in May found that unmanaged travelers were spending less and having a better experience than managed travelers. Those results were so dire that the association decided by the end of the year to try for a re-do as doubt about the role of managed programs proliferated.

Indeed, BTN had its own role in firing the flames around the debate. It could be argued that our editorial award recognizing Google’s Michael Tangney at the end of 2010 as European Travel Manager of the Year planted the seeds of doubt.

In a nutshell, the award pointed to Google’s ‘open booking’ strategy and unorthodox, spending cap-oriented policy that allowed travelers to book where they wanted and with their personally preferred supplier as long as the travel met the spending caps. If the traveler did better than the spending cap, they were able to donate the difference to the charity of their choice.

By 2012, BTN editorials were highlighting the similarities of Google’s program to those considered more traditional: “Google still uses many of the core tools of a legacy travel program. It negotiates with suppliers. It uses a travel management company, Carlson Wagonlit Travel. It has a corporate card, though its use is not mandated,” noted an article by then lodging editor Michael B. Baker (now executive editor).

The industry fixation on this program, however, combined with a number of other watershed moments in the industry.

The first, perhaps, was the ongoing legal battle between American Airlines and Sabre, which hinged on—among other issues—the airline’s initiatives to establish direct connects with travel management companies and technologies as it bridled against the limitations traditional global distribution technologies were putting on its ability to build offers for and connect more closely with the client through its product offering and ancillary services. It was impossible for AA to adequately display its full content offerings through the GDS, but the GDS was insisting on content parity in all channels or it would bias displays against AA, as it had temporarily done in early 2011 prior to a court injunction forced it to restore full access to AA content. The deal finally was worked out in October 2012 with a sudden denouement reached outside of court and finalized by the court on Oct 31.

The content disruption associated with that fight by 2012 had turned travel buyers wise to the fact—as if they had not been already—that content provided via the GDS would be subject in some parts to the tech limitations and even whims of GDSs as well as decisions by suppliers whether to place their content in the GDS. As such, it would never be complete and the push toward direct connect and direct bookings was making the situation more untenable. Travelers were booking out of policy and out of channel, and the next question travel buyers would need to answer from their executives was “what are you doing about it?” And no response seemed adequate.

At the same time, technology companies had moved to capture off channel bookings and wrap those bookings back into travel management reporting via itinerary management apps and other strategies.

In what eventually became the ultimate flex on this strategy, Concur began to leverage its 2011 acquisition of mobile itinerary management app TripIt to capture off-channel bookings (flaw: they needed to be forwarded by the traveler), which the technology could parse and integrate into both the booking but also into Concur reporting. The process was the technology foundation for what Concur would call its “Open Booking Initiative.”

In its infancy, Concur Open Booking was supported by none other than the BTN award-winning Michael Tangney at Google and a handful of other travel buyers forging what sounded like a “lighter touch” style of travel management that put travelers at the center of decision-making in terms of the tools they wanted to use to book travel and the suppliers they wanted to use at the prices that met budget requirements—or spending caps, if those were in place.

Concur wasn’t the only company looking to facilitate a book-where-you-want style of travel management. French travel and expense technology company KDS was looking to roll out Maverick as an off-channel data capture option. KDS rolled out quickly via a partnership with browser plug-in provider ProcureApp. Texas-based GDSX was going down the same road of off-channel data capture, with a product called TripLink. (Concur within a year would acquire GDSX and TRX simultaneously—and would take over the TripLink moniker for its own solution that we still know and use in the industry today.)

What could be wrong with providing that additional visibility into off-channel bookings?

Travel management companies and GDSs felt there was plenty wrong with it, and not least the prospect of reduced volume and revenue coming through the indirect channel. They railed at Concur for side-stepping the service and duty of care that TMCs afforded their clients. Concur’s response was that the company was looking to provide visibility into what was already happening, not to push travelers out of the channel.

TMC executives—in both BTN interviews and opinion pieces—decried the approach or dismissed it, saying it sounded nice but their clients weren’t fixated on a Google-style strategy. They, instead, were fixated on delivering on the objectives of the travel program to their companies.

Those TMCs didn’t speak for everyone, though. A group of a dozen buyers were intrigued—not only with the Concur Open Booking idea and technology foundation, but also with how TMCs could open up their services and support. With the support of alternative distribution channel Farelogix and the under the guidance of then-Kessel Run consultant Tom Wilkinson the travel buyers penned what they called the Corporate Travel Manifesto (link to The Beat, requires subscription), which called for seven points of change in the industry. Here’s what they were then—how would you change them for today? And, have we solved any?

1. The authors argue that there is a "shift in traveler buying expectations driven by technological innovation and a growing comfort with self-servicing." They note that "adapting to this change is critical," even if companies adapt in different ways, contingent on their size, culture and industry.
2. "Constant innovation in booking tools and interfaces make inflexible platforms unrealistic." To cope, companies either can modernize their tools or "extend access to new channels and content," while devising ways to keep the latter within a managed travel framework.
3. The relationship between the corporate client and the travel management company "must change to meet the unique needs of individual corporations." The authors argue that TMCs not only need to sell things like ancillaries and provide access to content, but also "to service travelers no matter where bookings are made," even if it's outside of the channels they provide.
4. Companies need transparency, and that means the ability to comparison shop "regardless of channel, including ancillaries." Complete access to content "to all supplier products and services" is also key, the authors argue. Increasingly important is the "support personalization based on traveler/loyalty status and corporate relationship."
5. “A corporate-driven 'Big Data' repository is essential." That means aggregated data "from all sources related to all corporate trips and travelers," including booking, card, expense and vendor data. They also want better analytics, data mining and "real-time access for QC, reporting, and analysis."
6. The authors claim that "relating all the data elements of individual trips is a best practice." They want to understand the full per-trip cost across their organizations.
7.  "Supplier post-booking/reservation processes (exchange, refund, discount, etc.) need to be decoupled from booking channels, simplified and reallocated back to the corporation/traveler." That, the authors argue, would allow "companies to calculate and manage the overall spend across multiple channels." Similarly, "corporate rates should apply regardless of source."

Thanks to BTN portfolio mate The Beat for supplying those salient points. The original manifesto is no longer on the BTN website, but if anyone has a copy, you know where to send it. I'd love to post as a resource for this archive series. ([email protected]). Enjoy the 2012 timeline. 

[Update: This article was corrected to reflect the correct time frame that AA content was not fully accessible via Sabre. It was January 2011, not the "first quarter of 2011." It has also been updated with a link to the original Corporate Travel Manifesto courtesy of one of the original creators of that piece Jennifer Steinke, now travel manager for Moderna.]

JANUARY

Bob Crandall and Gordon Bethune are the first inductees into The BTN Group Hall of Fame.

EU’s Emissions Trading Scheme prompts fare hike among North American and European carriers: Delta, Air Canada, Air France-KLM, Alitalia, American Airlines, British Airways, Luftansa, United and US Airways. OAG predicts more incremental price increases and IATA estimates the 2021 cost of ETS at €900 million.

Active Network acquires StarCite and makes plans to integrate technology. The transaction is valued at $57.7 million.

British Airways Heathrow presence projected to swell as parent IAG buys BMI from Lufthansa for about £172.5 million.

MARCH

BTN research reports about half of companies provide travelers with mobile expense reporting capabilities, but policies that touch on mobile booking or other mobile app use are not common. Travelers are most interested in mobile disruption alerts and mobile itinerary management capabilities.

Booking tool providers continue to improve mobile capabilities, and particularly focus on better mobile flight bookings. Concur, GetThere and KDS all say they are increasing usage on existing capabilities. Concur and GetThere tout TripIt and TripCase, respectively, for usage.

U.S. Customs and Border Protection makes permanent the Global Entry program.

Some members of European Parliament object to U.S.-EU deal on transferring passenger name records. A proposal to refer the deal to the European Court of Justice was voted down in April, when the deal ultimately passed.

A dozen buyers encourage innovation with a “corporate travel manifesto;” the document is the outcome of a buyer conference hosted by Farelogix, but participants deny any industry agenda driven by the alternative distribution provider.

Travel management benchmarking firm Runzheimer plans gamification system that rewards clients’ employees for booking lowest-cost travel.

U.K. TMC Portman Travel announces corporate carbon emissions data initiative for clients.

HRG unveils a “single view of all forecast and committed travel spend” and allows users to locate personnel and recognize high-risk situations.

APRIL

American Airlines and Travelport extend full-content deal amid legal wrangling. This is the second short-term extension forged in the past year by AA and Travelport amid ongoing legal battles.

IHG announces the development of an upscale hotel brand specifically targeting Chinese travelers, Hualuxe Hotels and Resorts, with plans for properties in more than 100 cities.

IATA calls out the rising demand for business travel—and its premium spend in particular—in an optimistic outlook that notes an uptick in confidence across some of the world’s largest economies. It also, however, points to the specter of rising oil and jet fuel prices that was likely to shrink margins for airlines.

BTN expense survey notes increased scrutiny of expense reporting, including reviewing and tightening policies; increased auditing; and upgraded expense reporting tools and reimbursement systems.

Maritz acquires Experient from private equity firm and majority stakeholder Riverside Co. Plans to keep it as a distinct meetings entity that targets associations and tradeshows as opposed to corporate client accounts handled within Maritz Travel.

MAY

With the onset of mobile technologies and personalization, the concept of traveler centricity enters the managed travel vernacular. BTN profiles IT consulting firm Cognizant as one company pursuing “associate delight” as the best lever for compliance to its new travel program.

GBTA introduces a suite of centralized services to benefit local chapters, but they come at a cost of $70 per member and 20 percent of gross revenues. At least 31 local chapters were  not on board, particularly with the 20 percent revenue requirement. By June, the plan is scrapped, but the fallout isn’t over.

CWT develops traveler scorecard based on a “stress index” that aims to aggregate individual traveler data to benchmark nights away and miles flown and what suppliers they’ve used. The move is a precursor to “adaptive travel policies” to replace the one-size-fits-all approach and introduces the concept of “the hidden cost of travel,” on employee productivity and mental stress.

BCD Travel details CSR efforts in rport to UN Global Compact policy initiatives for businesses that are committed to aligning operations and strategy against 10 principles for human rights, labor, environment and anti-corruption.

KDS, NuTravel and Serko launched a global online booking alliance wherein they shared sales leads and offered mutual multinational clients integrated data, broader content and consolidated contracts.

SAP releases cloud-based Travel OnDemand, which provides mobile and desktop access to expense reporting and travel bookings via SAP’s GetThere partnership. The cloud version is part of a larger BusinessbyDesign rollout.

CWT plans a new cost estimator called Meetings Optimizer and a small meetings booking tool for groups of fewer than 25 attendees.

Sabre readies virtual meetings booking tech with partners Tata Communications, Cisco, Regus and Glowpoint and other virtual meetings providers.

Amadeus One and Travelport Universal Desktop “mutli-GDS” agency technologies which would allow agencies to book on multiple GDSs through single desktop interface face criticism from the industry on slipping timelines and not-quite-baked functionality. Sabre calls the concept “overblown.” 

JUNE

Concur scores E-gov Travel Service $1.4 billion contract for online booking, expense management and related services. The choice of an approved TMC, however, is up to the individual agency. Carlson Wagonlit Travel, the incumbent on the contract, requested a “formal debriefing” from the GSA.

Texas court grants extension in American Airlines state antitrust suit against Sabre.

Spirit Airlines sees to apply revenue management to baggage fees, according to high-demand and low-demand times.

Association of Corporate Travel Executives executive director Ron Dileo leaves ACTE to join AirPlus International as CEO.

Barcelona-based Accelya comes under fire for potentially—and unwittingly—disclosing corporate air volume data in a report called eSmash that can identify air spend transacted through a single agency; and therefore air volume and routes for companies with implant or corporate travel department program structure could be exposed.

Global Business Travel Association report determines that stricter travel programs mean less happy, less ‘successful’ travelers.

White House Office of Management and Budget instruct federal agencies to cut fiscal year 2013 travel expenses by 30 percent and introduce new meetings policies.

HRG looks to change its services to integrate travel, expense and serve data—in an attempt to compete with platform providers like Concur and KDS.

Concur by June 2012 lays the groundwork for what it eventually would call TripLink (after acquiring GDSX and TRX in July 2013)) by leveraging TripIt Pro to push off-channel travel bookings into Concur Travel and Expense. The company also says it is initiating conversations with airlines to enable “open bookings” that would give corporate clients the ability to enforce policy and apply discounts to direct bookings. Some TMCs see the move as trying to cut them out of the managed travel picture.

South American carriers Lan and Tam merge.

JULY

American Express plans to issue chip-based cards in the United States as part of a ‘roadmap to advance EMV chip-based contact, contactless and mobile payment.’ This follows similar Mastercard, Visa and Discover announcements.

Air France plans to cut more than 5,100 jobs and restructure certain operations as part of an effort to rapidly regain break-even financial results. The carrier announces an investment plan in premium seating.

Swiss and Austrian Airlines plan to join Luftansa-ANA joint venture; regulatory approval and official onboarding date is April 2013.

Egencia reports average air and lodging prices rise 6 percent in North America.

GE’s famously consolidated global travel program makes exceptions to policy to contend with local content; it also reveals that it uses a collection of local TMCs and GDSs in certain regions to ensure access to regional suppliers and services.

Georgia BTA ends its exclusive affiliation with the Global Business Travel Association; the decision was prompted by GBTA’s Chapter of the Future project. GBTA responds by hiring lawyers for breach of contract.

US Airways launches bag-fee reports for corporate clients; not to be outdone, Delta will begin broader ancillary fee reporting for corporate clients called SkyPartner reports in August.

Tetra Laval is one of the first companies in the world to develop a mobile app for its own travel program.

TRX buys native mobile expense app Nexspense to speed development of its own tool Truexpense.

Meetings management platform Cvent makes its first-ever acquisitions of Seed Labs and CrowdCompass, both are mobile apps.

Travel automation provider GDSX unveiled TripLink, a new offering designed to capture data on purchases made outside traditional corporate channels and pushing records into existing travel agency workflows.

KDS partners with ProcureApp, a browser plug-in that, places pop-up messages on travel websites for travelers that try to book directly. The messaging can direct the travelers back to the approved channel or capture the booking. KDS uses it to launch its Maverick module.

AUGUST

Sabre’sPrism buy raises data privacy concerns among travel buyers and airlines begin to question their position with the GDS as Sabre becomes stronger, with a lock on airline data.

Concur’s open booking initiative attracts Google, Salesforce and suppliers, according to Concur co-founder and COO Rajeev Singh.

Mastercard partners with Rearden’s Deem booking tool for SME travel booking and expense site.

SEPTEMBER

Judge let’s American Airlines antitrust suit against Sabre proceed.

TCG Consulting acquires Consulting Strategies as its principle Mark Walton moved to Orbitz for Business as a strategy and account management vice president.

Mobile intinerary management supplier Worldmate upgrades it hotel price-monitoring application

OCTOBER

Travel and Transport in October bought Ultramar Travel in an all-cash transaction.

American Airlines and Sabre reach sudden settlement to close the most tumultuous period in their intertwined history (AA once owned Sabre). The settlement assures travel managers that AA content will be available in Sabre “for multiple years,” calls for Sabre to “display American’s content in an unbiased manner,” and enables AA to “continue to pursue its direct connect initiative.”

Visa, along with 13 banks, forge a new partnership for multinational T&E cards designed to provide global consistency and data.

NOVEMBER

CWT buys Worldmate intinerary management mobile app.

BTN publishes metrics from Amadeus, Travelport, American Express and a number of airlines that predict a slowdown in business travel for the coming year.

The Association of Corporate Travel Executives names Greeley Koch as its next executive director.

Mobile technology spurs duty of care traveler tracking trend, but companies look at how to limit privacy concerns as travelers become a dot on a GPS map.

EU court upholds airline passenger compensation regulations that a flight delay of more than three hours entitles passengers to the same compensation as those whose flights were canceled.

CWT partners with Vinivi to roll out client-specific hotel review technology within a secure, company-specific site.”

Travel Leaders acquires ProTravel with the intention to merge it with New York-based Tzell Travel Group, focusing on high-end unmanaged corporate travel.

Mobile messaging and traveler assistance tech provider ConTgo closes in on connecting two enterprise clients to its app via an API, rather than using an off-the-shelf version.

The EU stops the clock on emissions scheme for flights originating from or departing to countries outside the union.

DECEMBER

U.S. President Barack Obama orders U.S. airlines not to participate in EU Emissions Trading Scheme, reserving emissions negotiations with the EU as official government business.

HRG financial performance is impacted by clients’ declining travel activity. The company reported revenue down 10 percent for the first six months of its fiscal year. The company referred to belt tightening as a first line of margin recovery. Meanwhile, the company projected that its technology business could surpass its travel services business within 5 years. That did not happen. American Express Global Business Travel announced in January 2018 that it would acquire HRG.

Delta Air Lines and Virgin Atlantic plan within the next 12 months to launch a full integrated transatlantic joint venture through which they would align schedules, share revenue, connect corporate sales, etc. The JV would fill a significant gap for Delta at Heathrow. With a $49 million investment in the London-based carrier, Delta picked up three seats on the Virgin Atlantic board of directors.

Carlson Wagonlit announces it will use WorldMate to capture off-channel spending for corporate clients, with email parsing technology that captures such bookings and integrates it into an itinerary. 

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Elizabeth West is the editorial director of the BTN Group. She has reported on the business travel and meetings industries for 24 years. Beth was editor-in-chief of Meeting News from 2006 to 2008 and director of content solutions for ProMedia Travel from 2008 to 2011, when ProMedia was acquired by Northstar Travel Media and merged with BTN. She became editor-in-chief of BTN in 2015 and editorial director of the BTN Group in 2019. 

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