Exclusive Study Results: Buyer Focus In U.S. On Compliance, In Europe On Cost

U.S. travel buyers diverge sharply in practice and attitude from their European counterparts, according to the 2007 AirPlus International Travel Management Study, to be released next week.

The survey of 100 buyers in each of nine European countries and 100 buyers in the United States shows American companies are more fearful of price rises, largely because they have the highest expectation of growth in trip numbers too. They also have more compliant policies and automated travel programs than do Europeans.

However, perhaps the most striking transatlantic contrast is in the question that asked buyers to identify their top travel management priority: All nine European countries ranked reducing cost in first place, but U.S. buyers' number-one priority was travel policy compliance.

"This could well be driven by Sarbanes-Oxley and increasingly by the growing importance of traveler tracking," said Richard Crum, president and CEO of AirPlus International U.S. operations. "It may also suggest that other markets have more work to do on reducing costs, whereas U.S. companies have done most of what they can in this area and are moving on to managing cost through improving policy."

"This also suggests it is getting harder to negotiate in the U.S. The introduction of 'simplified' fares reduced some of the opportunities for negotiation in the domestic air market and it is tough to get anywhere with suppliers in the hotel market," Crum said.

Also notable is that seven of the nine European countries rank "optimal support of those traveling on business" as their second priority. In the United States, this is ranked last out of five.

According to the second annual survey, 82 percent of U.S. buyers expect their travel costs to increase, up from 53 percent in 2006. This compares with an average of 50 percent for all 10 countries. Eighty-eight percent of U.S. buyers expect to see air travel increases, up from 66 percent in 2006, while the average for all 10 countries is 55 percent.

U.S. buyers also have the highest proportion that expects the number of trips to increase-61 percent, against a poll-wide average of 48 percent. Last year, the U.S. figure was 51 percent.

When segmented by volume, there is evidence that U.S. corporate buyers with budgets between 625,000 and $10 million are rapidly closing the gap on their larger compatriots in best-practice adoption. One example is the adoption of travel policies that cover all aspects of travel spend. For medium spenders, this has jumped from 82 percent to 95 percent since 2006. "Larger companies are always going to have an advantage but certainly the midmarket is catching up very quickly," said Crum. "The new technology tools being developed for them by card providers, travel management companies and booking tool providers are helping that."

Adoption of automation generally is faster in the United States than across the Atlantic. According to the survey, for example, most European companies still want paper invoices only, where the proportion of U.S. companies that wants paper invoices only is 21 percent.