Travel managers for small and midsize companies aired
concerns on a recent BTN Communities call that a squeeze has been underway
among managed travel intermediaries—travel management companies, online travel
agencies and newer single-solution travel-and-expense technology-led
platforms—to shoehorn midsize programs into models that haven’t been optimized
for them.
The following notebook paraphrases the themes of
conversations taking place in BTN’s Small & Midsize Travel Program
Community—a buyer-only group of more than 200 travel managers who meet
quarterly to discuss such issues and who have a dedicated networking group
between online meetups to share best practices, policy nuances and travel
management strategies. BTN hosts these channels but has afforded the community individual
confidentiality so they may speak openly about program challenges and potential
solutions.
Artificial Intelligence-Based Solutions Look Pretty, but
Aren’t Ready for All
Especially for managers of midsize travel programs,
AI-powered platforms aren’t yet sophisticated enough to handle critical program
nuances. While buyers say they are being pushed to adopt automation and
tech-based solutions to power their programs—often because stakeholders want to
achieve the associated cost savings—there remains a percentage of bookings that
still require agent-assisted service, either because they are too complicated from
the outset or because they experience complex disruptions somewhere along the
way.
Midsize buyers agreed that 10 percent to 15 percent of their
bookings fell into this category. Still, they noted that available provider options
were dwindling when it came to service levels that include responsiveness from
experienced travel advisors and account managers but avoids the price point of
what buyers considered a VIP desk.
What they did appreciate about newer tech-driven platforms
was the consumer-style look and feel, and how those systems delivered a mix of
traveler-preferenced suppliers and itinerary choices in a simplified user
interface that still provided policy control. The user experience and improved
self-service of such tools, they said, drove usage of the booking channel.
That’s a major and valuable accomplishment, especially as workforces skew
younger and have higher expectations around workplace tech.
Once travel complexity pushes travelers out of the system,
however, buyers lamented the poorly equipped human assistance that, they said,
sometimes would book out of policy or ignore the availability of unused tickets
or not understand the concept of irregular operations re-accommodation on an
alternate airline when “solving” a problem. In the process, they create a new
problem—and cost the client company money.
White-Glove Service Too Much
Given an option of a VIP desk to handle such bookings, most
buyers said the price tag—estimated by one travel manager at about $150 per
itinerary—would be too cost-prohibitive. Plus, the service level, described by
one buyer to include airport meet-and-greet, luggage assistance and other at-your-service
type amenities, actually would be too high for a rank-and-file traveler. Buyers
who found success with more automated platforms revealed they used a different
level of service—and a totally different service provider—for company
executives who traveled extensively on complex itineraries.
What most buyers said they wanted was access to
knowledgeable human agents and account managers when first-line technology
couldn’t do the job. That occurrence—especially when tied to irregular
operations—is still on the upswing.
While outright flight cancellations in 2024 have been at low
levels, delays have increased, including those of three hours and longer on the
tarmac. Department of Transportation data released on Oct. 21 showed that nine
out of 10 U.S. domestic airlines experienced more delays in the first half of
2024 than in 2023 and other prior years, with 20 percent of all flights
arriving late.
Using VIP service as a net for travel disruptions was a
bridge too far for most travel buyers. They wanted the sophisticated technology
that would attract travelers to self-service, but if they had to make a trade-off—and
some were in active request-for-proposals processes, so they were pressed to
decide—they would opt for the more pedestrian technology experience if it meant
they could have more support from an agency partner in times of complex
operations but still avoid the VIP desk.
Wait for It…
That’s a hard trade when the first hurdle is getting
travelers to use corporate tools in the first place, and the midmarket clearly
recognizes that. If more companies will opt for the automated experience, the
faster such systems will learn and evolve. That’s the hope for midsize buyer,
but not many want to be that pioneer.
One buyer said the narrowing options reflected the reality
that has always challenged the midsize buyer and the service providers for this
segment: the margins just aren’t there to provide nuanced program support for
the midmarket when such programs can require as much nuance and strategy as a
large-market program.
As AI gets more savvy, agencies and technology providers are
rapidly pursuing more automated options. Big players like American Express
Global Business Travel have made major structural decisions based on a vision
of serving the growing midmarket business efficiently via advanced automation
and “AI-augmented” live agent assistance. Navan is aggressively on that hunt.
Direct Travel is on that hunt—as are companies like TravelPerk and Serko, both
of whom have made big investments in the North American market.
The verdict from BTN’s Small & Midmarket Community,
however, is that current technology isn’t quite there yet. And though the
segment may not want to stick its neck out to pilot new offerings, it is eager
to adopt a proven system.