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The Travel Industry Association this month outlined plans for two major research studies to quantify the return on investment of business and leisure travel and meetings as they ask the simplest of questions: "Why do people travel?" By late spring, association executives hope to have preliminary survey results from a major research house with which it plans to contract in January. Expected to also work with a "prominent business school," the association said by March it would release results of a study of chief marketing officers' and front-line employees' views on the bottom-line impact of corporate travel cutbacks.
"We need to be doing the work that we should have done over the past five, 10, 15 years," TIA president and CEO Roger Dow said of the "several hundred thousand-dollar" research initiative. "We have not built the compelling case for the ROI on travel: What happens when one organization pulls their sales people off the road and the other says, 'We're not doing that, we're going to try to pick up marketshare in these tough times.' "
Depending upon the severity of the economic situation, business and leisure travel and meetings and conventions could experience a decline in 2009 of 2 percent to as much as 6 percent, compared with last year, Dow said on a conference call last week with about 500 travel industry representatives. "We have to do something that our industry has never taken the time to do, namely: clearly, conclusively and effectively explain why travel matters."
Such definitive data is important, Dow said, to counter "the real and perceived barriers to travel in today's economic environment" and allow the association to more effectively communicate to national, state and local politicians as they consider legislation that could help or harm the nation's $740 billion travel industry. Some have called for TIA to embark on a massive advertising campaign, as it did after 9/11. However, Dow said, that would "simply fall on deaf ears with a business community that worries about bottomline, bottomline."
TIA board member and National Business Travel Association executive director and COO Bill Connors agrees with the need for data, but to combat the view "that the popular media has portrayed that people who travel or attend meetings are somehow un-American." Connors said there is a need for data to quash the notion that "travel is bad."
TIA's travel researchers know plenty about travel, Dow said. They know that travel "provides 7.7 million jobs," as well as traveler views on sustainability, traveler behavior on how and when they book, how much they spend and where they spend it.
"But as an industry, we need to make a stronger case for 'why?' Why the CFO of the Fortune500 corporation should maintain the travel budget and send equally as many employees to meetings and conventions in the face of the economic belt tightening. Why the family should take the vacation. Why President-elect Obama should embrace travel and, for example, provide tax incentives to spur travel as a means of stimulating the American economy," Dow said.
The research and emphasis on both business travel and meetings, in addition to leisure travel, are all part of the association's new priorities as it completes a merger with the 13-year-old advocacy group Travel Business Roundtable and changes its name to the U.S. Travel Association, all as of Jan. 1. In the new year, the association also plans to debut its first political action committee to raise funds to lobby the new Congress.
The association has long lobbied on Capitol Hill and delivered briefing papers to both presidential candidates earlier this year. Last year it won passage in the U.S. House of the Travel Promotion Act, a bill to create a nonprofit corporation to promote travel and tourism to the United States. But the measure stalled in the U.S. Senate. Officials expect the bill to be reintroduced in the new congressional session.
TIA also has posted all briefing papers and research on numerous travel-related topics--everything from funding of the Federal Aviation Administration, highways and rail systems, to border security, passports, climate change and travel promotion--on a Web site called the Power of Travel.
The initiatives are all part of the repositioning of the 60-year-old trade association to speak as "the voice of America's" travel industry to promote not only inbound tourism, but travel within the United States on behalf of its more than 1,800 members. In addition to the research, the organization also plans to debut a "travel dashboard" to provide members more real-time data about bookings and emerging trends to allow them to shift marketing dollars or staff to capitalize on them. For far too long, TIA and the travel industry have relied on old data to forecast future business plans.
"Year-end 2007 doesn't in any way resemble the year going into 2009," Dow said.
While TIA has often touched on meetings and business travel, Dow acknowledged that previously "we probably shouted leisure and whispered business. Now we're going to shout all three." All three are "part of a three-legged stool" for travel suppliers. "Remove any one of the legs and the stool falls over."
As economic concerns have undermined the stability of this stool, Dow said, association executives during the past two months have talked to many members and other industry associations about the best response.
"This is a different economy than we've seen in a long time in this country," Dow said. "We're all going to figure out how to adapt to it. Nobody has any answers, so we're beginning to lay the bricks and mortar that we probably should have done five to 10 years ago."
Susan Gurley, executive director of the Association of Corporate Travel Executives, agreed with Dow. The "scope of this challenge is of such magnitude that the most innovative strategies will be required to sustain corporate travel programs," she wrote in a letter sent to volunteer ACTE's expertise and resources to the research effort. "Strategies that prove that arbitrary, across-the-board travel cuts can impede corporate growth and stall a company's economic recovery."
The U.S. Travel Association, Dow said, hopes to work with other associations. "We're talking about how we can work together to do even deeper research than each of them has done on their own," he said. Representatives of various meeting organizations, he added, plan to meet in New Orleans next month during a meeting of the Professional Convention Management Association.
While ACTE "welcomes any research-generating endeavor that can enhance the travel experience for the millions of business travelers that visit the United States each year," Gurley said, ACTE already has answered the question of why people travel for business and suggested how that motivation is likely to change in the immediate future.
"Businesses travel to establish relationships and trust that support initial sales, ancillary commercial development and competitive presentation," according to a statement by Gurley provided to Management.travel. But the "traditional method of conducting business is going through a major evolution, associated with a stalled global economy. Attempts to simply cut all travel due to economic concerns, or to arbitrarily replace business travel with electronic means, will ultimately be regarded as short-sighted practices that curtail corporate growth or restrict financial recovery. ACTE has endorsed a formula that converts travel programs into highly cost-effective hybrid policies that free up funds for revenue-producing trips that will sustain corporate growth in difficult times. I believe TIA will find this process will work exceptionally well for sustaining business travel to the United States in 2009 and beyond."
In a separate research project that Connors said would complement TIA's, NBTA in conjunction with Global Insight just began a project to size the business travel industry. American Express has previously sized the business travel industry and the Convention Industry Council sized meetings and conventions, but neither group has updated the data recently.
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