Corporate card providers are reporting increased interest in
payment products tailored for meeting expenditures, but most corporate planners
still have not adopted payment tools as part of their programs, according to a
recent study.
A Carlson Wagonlit Travel study of 21 companies released
last month said only 10 percent relied on dedicated charge cards for meetings,
while others either had no meetings payment strategy or used what Carlson
Wagonlit Travel considered less optimal payment methods, such as invoices or
payment orders. "Other payment methods provide less transparency and
control, depending on how they are used. For example, companies often use
purchase orders to work with events agencies, which generally means costs are
bundled into a single cost code," CWT said.
CWT said it expects more organizations to adopt meeting
cards, "ideally a single meeting card per meeting or planner," to
collect spending data as procurement professionals increasingly play a role in
meetings management.
Most major corporate card issuers—including American
Express, BMO Financial, Citi, JPMorgan Chase and U.S. Bank—offer some sort of
meeting card product. U.S. Bank reported that it had issued 400 such cards as
of Dec. 31, 2009.
Card suppliers said the economic downturn temporarily might
have slowed meeting card adoption. Visa, for example, launched a new meeting
card in 2008. Rafael de la Vega, head of large and middle market for Visa
Commercial Solutions, said interest in the card started off slowly, as
companies were meeting less and thus had less need for such a product. As
demand has begun to return, interest in the card has picked up considerably, he
said.
"We are pushing the product again in the marketplace,"
de la Vega said. "We are seeing companies opening their T&E budgets
back up, and this is a segment we track closely."
An American Express spokesperson said, "We're seeing
meeting card growth globally. Meetings and events represent a significant
opportunity for companies to save money, so obviously products like a meeting
card can help companies increase their visibility and control over meetings
spending."
American Express in 2008 linked its meeting card product
with technology from meetings tech firm StarCite to create the Meetings360 tool.
Kevin Iwamoto, StarCite's vice president of enterprise strategy, said the
partnership places the payment product as a key piece of a strategic meetings
management program.
Using other forms of payment when procuring meetings could
lead to difficulties, Iwamoto said. For those who use standard travel and
entertainment cards, the spending limits generally are not high enough to cover
such pricey items as guest speakers, he said.
The bigger challenge comes when it's time to reconcile
meeting costs, he said.
"This is when using a procurement card or T&E card
gets messy," Iwamoto said. "The spend that you put on those cards isn't
necessarily attributed back to the meeting ID number."
CWT said organizations could deploy any number of
centralized payment options—from a corporate credit or procurement card to an
electronic payment system—but a meetings card is particularly suited to track
spending, consolidate expenses by supplier for negotiations, apply expenses to
the right cost center, zero in on detailed data points and reconcile spend
against budgets.
"Corporate meeting cards can be particularly effective
when integrated with strategic meetings management tools for detailed,
consolidated data," Carlson Wagonlit said. "Commercial card providers
are expanding their solutions to help meetings and incentive planners with
reporting and reconciliation. They offer, for example, online summaries of
spend per meeting/planner and per supplier, year-over-year trend analysis,
market benchmarking information and automatic data feeds into company financial
systems."
Meeting cards generally come in two forms: a card attached
to a business travel account or standard individual meeting cards with
declining balances, StarCite's Iwamoto said. Cards with declining balances
usually are the preferred choice among meeting professionals, particularly
those responsible for multiple meetings across a company, he said.
"For those power planners, it just makes everything so
much easier," according to Iwamoto. "Each budget for each meeting is
front-loaded on the card, so all they have to do is pop receipts into a
separate envelope for separate meetings."
Jeff Rankin, senior vice president and senior sales and
marketing officer for U.S. Bank's corporate payment systems unit, said planners
also see them as good negotiating tools with hotels. As a result, interest in
the issuer's meeting card product, launched several years ago, has grown
steadily over the past few years, he said.
"If I've got a meeting card, I can go to a Marriott or
a Hilton and remind them that I did 12 meetings with them last year and spent
$180,000," Rankin said. "That way, I can be treated like a $180,000
customer rather than a $10,000 customer 18 times."
Besides better data management, meeting cards can provide
immediate cost savings by cutting out the cost of the multiple purchase orders
otherwise needed to procure meetings, Iwamoto said.
"These can be very cumbersome, time-consuming and
expensive, and you could have as many as seven or eight per meeting,"
Iwamoto said. "You have to issue a card only once."
This story originally
appeared in the August 9, 2010, edition of Business Travel News.