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What lies ahead for the corporate travel industry?

31st March 2021

By: Creamer Media Reporter

     

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This article has been supplied as a media statement and is not written by Creamer Media. It may be available only for a limited time on this website.

Business travel as we know is expected to disappear forever – shrinking in the face of ongoing travel restrictions and a trend towards remote working in a world still gripped by the coronavirus.

The GBTA (Global Business Travel Association) predicts that US and European business travel will return to between 75 and 85% of 2019 levels by 2024 (a drop off of between 15 and 25%) while the Middle East and Africa is expected to fare better due to comparatively lower COVID cases than other regions.

In a South African context, Andrew Stark, Flight Centre Managing Director for Middle East and Africa, believes that corporate travel will recover to 60% of pre-pandemic levels by June 2022: “We envision a number of false starts throughout 2021 as the COVID pandemic remains unpredictable but once vaccine programmes take hold, we expect to see recovery improve.”

Bonnie Smith, General Manager of FCM Travel Solutions agrees. “There is no doubt that business travel faces a long road to recovery,” she says. “But it will rebound – especially for multi-national companies who rely on corporate travel programmes to get their teams around the world.” 

For Smith, this is what we can expect on the road to recovery:

1. An increasing appetite for travel

It’s hard to believe, but the first Millennials (who make up three-quarters of the global workforce) turn 40 this year. This is significant because according to MMGY Global, 81% of Millennial business travellers believe that business travel has a positive impact on their job satisfaction.

But while individual travellers may be ready to go, Smith believes that travel managers and decision-makers are still understandably wary. “Corporate travel managers carry the burden of the safety of their team. They need to know that their travellers will be safe, and that they can bring them home quickly should new border closures or travel restrictions impact their trip.”

Smith says international trips now have layers of approval, with two or more signatories needed as companies determine whether trips are absolutely necessary.

“There’s no doubt that business travel is being assessed through a new lens,” says Smith. “Questions like ‘is this meeting really necessary?’, ‘can it be done virtually?’, ‘what are the cost and productivity implications of a mandatory quarantine?’ and ‘will available air routes complicate and extend trips unnecessarily?’ abound. But if TMCs can provide the right support, travellers are ready to hit the road.”

2. Cost per trip vs. volume

While business travel may not rebound to pre-pandemic levels in terms of volume of trips, we may see spend recover through cost per trip.

Smith believes that business trips will become longer as companies insist on bang for their buck – in terms of budget, productivity, intention and outcome.

“There are only so many questions one can ask on a Zoom call,” says Smith. “Many companies are now discovering that junior team members are floundering, missing out on the knowledge gained in the field. From company culture to hard, technical skills, much is learned by osmosis.

“Multinationals are beginning to feel the shortcomings of virtual meetings and training.  Mining, energy or research & development are just a few examples – all need on the job training and development, with mentoring and support critical to an employee’s future success in their role.”

While senior employees have made the switch to a virtual world with relative ease, Smith believes that younger staff still need the opportunity to learn and grow, which often means jumping on a plane to learn the ropes.  

“Companies are going to make 100% sure that there business trips count,” says Smith, “And will work closely with TMCs to establish and manage their travel budgets, source the best deals, approve and justify each trip – and report on the return of investment.”

3. A focus on expertise, technology and duty of care

According to Smith, alongside the safety of travellers, expert advice is paramount at the moment.

“Our clients, want to know that their teams will be safe, but also that we can help them navigate the complexities of travel at the moment,” says Smith. “We’ve noticed that many clients are turning off their online booking platforms, preferring to talk directly to a consultant when it comes to travel decisions.”

Business travel’s recovery will rest on the expertise, level of service and technological support that TMCs bring to the party. For Smith, technology, automation, flexibility and reporting will be key.

 “Clients want to know where their travellers are, how quickly we can bring them home – as well as up-to-the-minute travel information. They need also need to know that that we’ve got a handle on their budget and can generate a real-time report.”

4. A COVID Health Passport

Twenty twenty-one is the year of the vaccine. And although rollout will happen at different speeds around the world, a new report from TripAdvisor suggests vaccinations will be a game-changer in terms of traveller confidence.

Globally, more than three quarters (77%) of leisure travellers surveyed say they will be more likely to travel internationally if they receive the vaccine – and this rises to 86% for domestic travel.

Although this talks to leisure travel in particular, we can assume it’ll have a major influence on international travel too.

“Travel programmes are putting strict policies in place around duty of care, PPE and the like. A vaccine, combined with a digital health passport, will have a massive effect on business travel,” says Smith. “Positive, early signs are there, and we’re feeling confident

Edited by Creamer Media Reporter

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