Online Agencies Get New Clients

Publishing company Knight Ridder and rail carrier CSX are the newest midsize to large corporate accounts for Orbitz For Business and Expedia Corporate Travel, respectively. Both this spring officially are switching over to their online-originating agency partner after years of dedicated-agent relationships with travel management companies. While the results thus far are hard to track, travel buyers for both firms said they have been pleased with the level of customization offered by the vendors and the real-time reporting tools. They anticipate greater savings off transaction fees than airfares and room rates.

With 5,300 travelers, Knight Ridder is launching OFB next week after running a small test beginning one year ago that showed a 20 percent savings on agency fees compared with the incumbent, TraveLeaders. Knight Ridder said that during 2003, one-fifth of travel spending had been going outside of the managed program. As OFB is just becoming the designated agency, travel manager Ellen White said it's too early to say what to expect in terms of compliance. "As we move from the old, comfortable shoe, many may still be making reservations that way," said White, who has served as Knight Ridder's agency account manager beginning with Carlson Wagonlit in 1995. "Clearly, there are points of pain when you make a transition like this, but I think the majority of the individuals understand why we're making the change. With budgets as they are, people even like to research, but here's a tool where you don't have to search many places." She said Orbitz accommodated her need to access Southwest Airlines' Swabiz site by linking to it through the opening OFB page. "They really are listening with both ears," White said.

On CSX's behalf, Expedia Corporate Travel for now is calling to book Southwest. "It's pretty much what we have to do unless Southwest comes to the table," said corporate services director Daniel Burns. "And Southwest isn't the only one. We'd certainly like to see them in the mix with everyone else."

CSX beginning April 1 has required travelers to use Expedia Corporate Travel, without having done a pilot test. "We had a lot of angst about that, as we have moved agencies a couple of times in the past," Burns said. "But actually it went smoother than we thought it would."

The company for more than two years was using a GetThere booking tool along with an unnamed TMC, with a maximum adoption rate of 46 percent. So far in April with ECT, Burns said, "We're at 65 percent online booking even with people still trying to learn, so we're confident that will grow." As for service, Burns said, CSX had no complaints about its prior agency. "It really boils down to economics," he noted. "Transaction cost is really important to us." CSX has about 4,000 frequent travelers and spends $5.8 million annually on air travel in the United States.