Advocated for more than a decade and producing some success stories, use of electronic hotel folio data still has not fully taken off in managed travel. As discussed here this week by hotel, corporate card and travel management executives at the Association of Corporate Travel Executives conference, a disconnect remains between developmental needs, customer demand and adoption.
Over the past few years, several hotel companies and corporate card providers aligned to put more robust hotel spend data in the hands of their corporate clients. Most recently, MasterCard International and Intercontinental Hotels Group this month signed a deal covering IHG's North American properties, according to Paul Adler, MasterCard Worldwide vice president of global commerce development.
By electronically receiving the folio detail--room rate, taxes, phone, food, Internet, parking, etc.--companies can more closely analyze their purchases, better negotiate with hotel suppliers, promote adherence to Internal Revenue Service rules on expense reporting and improve travel policy compliance. Meanwhile, business travelers staying at participating properties benefit from pre-populated expense reports, which save processing time, improve accuracy and minimize the reimbursement cycle.
Efficiencies in the expense reporting process also can draw travelers to electronic folio-enabled hotel properties when they make bookings, especially when those properties are highlighted in self-booking systems. This can improve preferred property usage.
So why has adoption lagged? Travel program managers will not invest the time and resources necessary to accept e-folio data feeds unless their card provider and issuing banks can facilitate the transmission and a majority of preferred properties participate in such programs. At the same time, hotel companies may be hesitant to spend the significant sums required for implementation until they see clear demand and commitments from clients.
"I do not think we are hearing too much," said Russell Green, director of corporate sales in EMEA for InterContinental Hotels Group. "We need a business case, and we need it articulated. We also need the return on investment, to know what that will look like in terms of improved compliance, improved market share, more revenue, more room nights, etc."
Hyatt Hotels executive director of sales Kevin Kelly added, "We had a meeting recently with 50 big corporate buyers and a lot of people were interested in it but there was not one hand in the room that went up saying, 'We are really ready to implement this.' When do you really think the rubber is going to meet the road? Has anyone seen [e-folio requirements] in an RFP?"
Randy Jones, director of enterprise accounting services at Marriott International, appeared surprised by Kelly's comments and noted that several hundred of her company's accounts now are receiving e-folio feeds from Marriott and via card companies. "We are getting them in our RFPs," she said, adding that next year she expects "60 percent to 80 percent of spend at global corporations will be funneled into these reports."
"The rubber has met the road in North America," added Adler, who said MasterCard can obtain e-folio data from more than 11,000 properties. "Maybe we are not fully up to speed, but that final gear is the complete integration with the expense management systems. We are not there with all the expense tools yet, but it is something that is being consistently worked on."
Expense management software providers have a key role to play because their products must accept data feeds and present the information via user interfaces as part of automated reporting processes. "When I talk to [expense management] providers, they say they could have done this quicker," Jones said. "It is not that hard, and they heard the demand, but they were not seeing enough adoption."
Evidently, some now are. Extensity this summer released a new version of its expense management software that can "automatically itemize hotel folio details from leading corporate card providers, including American Express, Visa and MasterCard." Concur Technologies is developing similar functionality.
Usage of e-folio is likely to gain momentum as the technology elements fall into place and the benefits for both travelers and their companies become more recognizable. "If you have three hotels in a city, you can bet that [travelers] will pick the one with e-folio because it makes their expense processing so much easier," said Sarah Edwards, EMEA travel consultancy manager for IBM and an account manager for Proctor & Gamble, which outsourced travel management to IBM. "It is a no-brainer."
IBM was one of the first travel buyers to push hotels to transmit e-folio, and has reported tangible savings in terms of both reduced auditing costs and hours spent processing expense reports. It now is looking to replicate that success for Procter & Gamble.