2017 Modern Travel Booking

Report

October 26, 2017

TABLE OF CONTENTS

Introduction

Business travel is key to initiating and fostering client relationships, and is becoming more common as the global business community becomes more widespread, intersectional, and competitive. Some companies spend millions of dollars on travel and expenses each year with the ultimate goal of increasing company revenue and success. However, if travel spend is mismanaged, organizations jeopardize their ability to achieve their goals. Without proper management and transparency, business travel can become both a resource drain and a potential risk to an organization’s financial health and competitive positioning. One way that companies try to improve control over travel spend is by implementing stronger guidelines over how employees book travel. Traditionally, many organizations have outsourced the management and spend of their travel activity to travel management companies (TMCs). However, with the increase of online options and changing expectations among consumers and businesses alike, these service providers are not as relevant to the business traveler as they once were.

Today’s digital, global business age necessitates a different approach in order to truly optimize travel spend. This involves leveraging the most advanced travel booking systems, which support business travelers and streamline travel booking without sacrificing any control over the booking process. These systems are online booking tools (OBTs), which provide companies with spend data and control beyond what they can gain under an informal, unregulated booking process.

This report is for companies looking for a leading booking tool that will enable them to fully control and optimize their travel spend. The report aims to serve at least two types of companies—those that are managing their travel booking and spend through a completely manual process, and those that rely on a TMC for the majority of their travel spend management but wish to leverage an additional booking tool to improve the process This report presents recent trends in booking management among North American organizations, as well as an overview of booking solutions and best practices for using these tools.

The Modern Travel Booking Process

In order to highlight the benefits of modern booking tools and their impact on business capabilities, the following content explores three main components of modern travel booking, ticketing, and purchasing—the TMC, the corporate card, and the use of online booking tools. This content is based on data from Levvel Research’s recent travel and expense management survey, which was conducted across several hundred organizations from a variety of industries and market segments.

The Use of the Travel Management Company

A TMC typically offers a variety of services that support the day-to-day operations of a company’s travel program. Internally, TMCs consult and work to maintain the company’s travel policies, manage travel and expense data, and perform duty of care on travelling employees. Externally, TMCs negotiate with travel vendors (e.g., air, hotel, venue, and ground transportation), oversee corporate loyalty and frequent flyer memberships, and manage payment-related functions, such as credit card management. TMCs leverage Global Distribution Systems (GDS) to meet their clients’ booking and ticketing requirements, sourcing these items at competitive prices and reducing overall travel spend. TMCs also connect with and provide assistance for many travel and expense management (TEM) solutions.

The TMC was once more than enough for the average organization. However, in the last few decades, innovation and shifting consumer behaviors have caused some businesses to change their approach to travel management. Companies and their employees now have greater access to travel services and innumerable booking options, particularly with the introduction of consumer-facing online booking tools. For the sake of time, convenience, and sometimes cost, many companies have taken part or all of the booking process into their own hands. Levvel Research identifies this trend as a decrease in dependency on third-party services and an increase of internal autonomy, both of which are largely congruent with greater access to travel options via the internet.

Figure 1 shows that while over half of companies are still using a TMC to manage travel booking, 17 percent are using a booking tool, and 29 percent leave booking to their employees’ discretion. Unfortunately, in the transition from fully managed corporate travel to more autonomous methods, some companies sacrifice control in the booking process

Figure 1

__Most Organizations Use a TMC to Manage Travel Booking__
“In general, how do your organization’s employees book corporate travel?”
Figure 2

__Larger Organizations Are More Likely to Use TMCs__
“In general, how do your organization’s employees book corporate travel?” & “What is your organization’s annual revenue in the most recent 12-month reporting period?”

because travel purchasing does not always occur within the company’s own travel management system. This prevents companies from gaining complete control over spend and access to travel data, and it also creates disruptions for the expense reporting process downstream.

Figure 2 shows that larger companies are much more likely to use a TMC than those in the lower middle market (LMM) and small enterprises. This is partly due to a lack of resources among smaller companies to enlist the services of a TMC. It also speaks to larger companies’ greater travel and expense (T&E) budgets and costs. Managing such high T&E spend requires a great amount of control and visibility, which a TMC is well able to provide. As smaller organizations pass on TMCs, they are much more likely to book travel using manual, uncontrolled methods, which creates many issues in cost control and data visibility.

Levvel Research sees the proper way to manage travel spend as a balance between traditional and modern methods. If leveraged correctly, modern booking tools offer companies a great deal of control over travel spend. These tools can be integrated with TMC services to improve the value of their offerings, and they can also be leveraged alone by smaller organizations to bring much needed regulation to their booking process.

The Use of Corporate Cards for Travel Spend

Another key tactic that many companies use to control employee travel spend is the use of corporate travel cards. These cards, tied directly to company resources, provide detailed data on employees’ purchasing. They also reduce

Figure 3

One-Half of Organizations Report Mandatory Use of Corporate Travel Cards
“What is your organization’s policy regarding corporate travel cards?”

the risk of faulty reporting and maverick or fraudulent employee spend. Levvel’s research indicates that corporate cards are prevalent among North American organizations for travel purchasing. In fact, most companies have a policy in place that requires employees to use them for travel-related expenses, see Figure 3.

There is also a relationship between company card policies and organization size, see Figure 4. Company cards are more prevalent in larger organizations, which may be due to the difficulty in monitoring expenses and reimbursements across a greater number of travelers. On the other hand, optional corporate card use is more prevalent in middle market companies, whereas employees in lower market organizations are typically required to use a personal card for booking and purchases.

Figure 4

Corporate Card Use Varies by Company Size
“What is your organization’s policy regarding corporate travel cards?” & “What is your organization’s annual revenue in the most recent 12-month reporting period?”

One of the great advantages of corporate cards is their compatibility with online booking tools, with which they can be integrated and set up to include the company’s policy controls. Corporate cards are particularly useful when companies are not using a TMC or do not have firm rules regarding booking methods, as the cards give companies access to travel data they would otherwise miss out on. Levvel Research suggests mandating corporate cards for travel purchasing as much as possible, and leveraging the cards with an OBT to create a more streamlined, controlled booking process.

The Use of Online Booking Tools

Companies that have adopted OBTs as their primary booking method cite several benefits in their travel and expense management. The top benefits are increased visibility into costs, a reduction in time spent by employees on travel bookings, and a reduction in overspending by employees, see Figure 5.

Figure 5

__Most Organizations Report Increased Visibility into Spend After Adopting an OBT__
“Which of the following benefits do you feel your organization achieves from using your booking solution?”

Despite these benefits, many organizations still have not adopted a booking tool. Research shows that the top barrier to adoption is a belief that there will be no ROI, followed by a lack of understanding of available solutions, see Figure 6.

Figure 6

__Most Organizations Hesitate to Adopt an OBT Because of a Belief That There Will Be No ROI__
“What is the primary reason your organization does not use an online booking tool?”

The following section serves to combat some of the barriers to OBT adoption. It demonstrates the ways booking tools reduce costs in travel booking, and it highlights the features and services provided by OBTs.

How Booking Tools Work

Online booking tools streamline employees’ travel planning by connecting them to a variety of items and services at competitive prices. Leading tools offer more data across different purchasing variables, and enable companies to execute data-driven decisions to optimize spend. OBTs can also track compliance with travel policies and help oversee employee safety by providing a comprehensive look into booking practices and itineraries. Below are some reasons to consider adopting an online booking tool.

Travel Policy Compliance

Companies can establish business rules, configuring OBTs to their specific needs and travel policies. They can also configure the system to flag out-of-policy bookings and to refuse bookings that are not compliant with travel policies. Many tools also permit companies to highlight preferred vendors, and can prompt employees with reminders about specific travel policies.

Duty of Care

Companies have the responsibility of knowing an employee’s status and location when they are traveling for business-related reasons, termed a duty of care. OBTs provide a centralized booking platform where traveler details can help alert companies to their whereabouts in the event of a crisis or travel risk, such as in the cases of political instability or civil unrest. In addition, if the traveler has purchased their travel itinerary through their company’s OBT, their company can contact them in the case of more common circumstances, such as bad weather.

Reporting and Analytics Capabilities

OBTs capture data for each booking across a wide range of variables. This means that companies have better insight into patterns and trends, and it also benefits accounting departments by providing a comprehensive look into spend. OBTs’ data capture capabilities also play an important role in supplier negotiations, as trackable travel volume can yield higher discounts from suppliers.

Employee Satisfaction and Customization

Because business travel can have such a great impact on an employee’s productivity and satisfaction, it is important that the travel booking process is as simplified and optimized as possible. Leading booking tools are easy to use and offer search results and travel options that best meet the employee’s needs and preferences. This improves the employee’s business trip—and consequently, their productivity.

Using Booking Tools

When adopting an OBT, it is important that organizations leverage best practice management techniques. One technique is to mandate that employees use the tool for all travel booking. This requires eliminating circumstances in which employees would be driven to book outside of the proper channel. For example, sometimes employees may go directly to the source of a travel-related item (e.g. the website of their preferred airline) to make the booking. This means the traveler’s company will not have direct access to the booking information. Without the proper mandates in place, companies miss out not only on savings that come with centralizing purchasing processes, but also on valuable spend data with which they can improve their current state.

Another consideration in booking tool management is choosing the right tool for both current and future needs. For example, if an organization is using a TMC, it should evaluate an OBT tool that can integrate well with the TMC’s services and platform. In another example, if a company is using or plans to adopt a TEM software, it should ensure the booking tool can integrate with the solution.

In all, the greatest way to achieve optimal travel booking is to take a controlled and modern approach. The following profiles feature a few modern travel booking providers that Levvel Research has identified as leaders in the market. These profiles serve to give brief examples of modern booking tools for organizations considering adoption.

Online Booking Tool Providers

Amadeus

One of the oldest and most trusted travel services providers on the market, Amadeus is the product of a collaboration between Air France, Iberia, Lufthansa, and SAS. In 1987, these companies teamed up to create a global distribution system that would connect TMCs with travel agencies and consumers. Today, this distribution system is one of the largest travel aggregators in the world, and provides search, pricing, booking, ticketing, and other processing services. The company operates in 190 markets and reports over 15,000 employees. Amadeus also offers a set of business IT solutions for travel companies, helping them automate processes such as reservations, inventory management, and departure control. Its primary business tool is the Amadeus Altéa Customer Management System (CMS).

Concur

Founded in 1993, Concur is one of the oldest and largest providers in the travel technology space, and it is one of the first TEM providers to offer its own native booking tool within its full TEM solution. This allows its TEM users to access everything within a single application, from pre-trip approval to booking to expense reporting. Concur also offers a unique “app store”, for which it has partnered with numerous bolt-on applications that enhance the solution and improve control over booking. Concur also offers a way to capture out-of-system bookings with its TripLink tool. Concur’s solution is the first to integrate with rail providers, Uber, AirBnB, and many eReceipt providers such as Starbucks and various hotel chains. Concur was acquired by ERP giant SAP in 2014, but will continue to operate as Concur for the foreseeable future.

Deem

Deem, Inc. was founded in 1999 as Rearden Commerce. The company focuses on supplying a tech-forward platform to business travelers, with functionality that suits the needs of different users within the travel and expense process. Deem reports over 50,000 corporate customers in 61 countries, and the solution supports 15 languages. Deem’s most recent travel booking release, the Deem Work Fource platform, offers modules and functionality for four different parties within the T&E process—business travelers, travel managers, TMCs, and suppliers. For the business traveler and the travel manager, Deem offers the Road Work and Clock Work modules, which provide tools for travel booking and employee compliance management. The Book Work module is designed for travel management companies, while Deem Net Work is for suppliers. Deem also offers functionality around expense report management with Deem Expense.

Egencia

Egencia LLC, a division of Expedia formerly known as Expedia Corporate Travel, Inc., is one of the leading providers of corporate travel booking services. Founded in 2002, the company’s strength and appeal lies in its booking tools. However, it continues to broaden its product suite to support the entire expense management lifecycle, and provides many additional service solutions, including agent services, VIP executive travel, account management, implementations, groups and meetings, and consulting. The company’s most recent release, Egencia Advantage, offers services designed to support business travelers throughout their entire journey, with tools including airport lounge access, traveler risk management, and travel visa services. Egencia provides services in more than 65 countries. In 2016, Egencia absorbed Orbitz for Business.

KDS

KDS is a France-based company with over twenty years of experience in the travel booking space. The company offers both travel booking and expense management solutions, but is known primarily for the strength of its online booking tool. Its most recent product addition is Neo, a cloud-based tool released in 2013. Neo allows business users to search and book travel itineraries in a more holistic manner, rather than booking each component individually. Features include a calendar-based view of travel itineraries, live street views, map overlays, and itinerary timelines by travel steps, (i.e. depending on mode of transport and option selected). In 2015, KDS released a mobile application, Neo Move, for iOS and WatchOS in order to broaden Neo’s support capabilities. In 2016, KDS was acquired by American Express Global Business Travel (GBT), which will leverage the KDS platform to expands its traveler-focused technology services.

nuTravel

nuTravel was founded in 2002 as an online tool primarily supporting airline booking. Today, the company offers custom-developed booking platforms to over 8,000 companies for a variety of travel booking needs. nuTravel offers platform-agnostic capabilities in merchandising and retail. nuTravel was recently acquired by TEM software provider Certify. nuTravel’s booking technology will serve as the foundation for a new offering, Certify Enterprise Travel, which will give Certify’s client base access to a greater range of travel vendors.

Sabre

Sabre Holdings Corporation, formerly known as Sabre Group Holdings, Inc., was originally founded in 1960 by American Airlines as a computerized reservation system. In 1976, it was adopted by its first travel agency, and has since expanded to support airline, hotel, and car rental reservations. Today, it is one of the leading travel GDS services in North America. Over the years, Sabre has helped to create software for online travel agencies, corporate booking tools, revenue management, and web and mobile itinerary tools. It is also the original parent company of Travelocity, which it sold to Expedia in 2015. Sabre offers several travel services, including those for TMCs, suppliers, and government entities. Its corporate business travel management product, Get There, is based upon its travel reservation system and is used in over 100 countries.

Serko

Serko was originally founded in 1994 as Interactive Technologies Limited (ITL), which offered technology to helped travel agents streamline booking. Today,the company provides a leading travel booking platform for corporate business travelers and travel managers, and has expanded its offerings to include expense management. Its primary travel booking tool, Serko Online, integrates with many major expense management solutions and GDSs. This allows users to book flights, accommodations, and cars from a broad set of travel providers, with built- in policy controls. Although Serko’s greatest presence is within the Australasia market, it serves customers in more than 25 countries.

The Final Step: Optimizing Travel Data Management

Using a booking automation tool is a best practice for any company trying to manage a large amount of employee travel spend. However, even with the best intentions and a leading booking solution, some travel-related spend can fall outside the booking solution’s control. It can be difficult for all the parties—from the corporation to the expense management tool to the TMC—to manage all activity and booking data in one system, particularly when larger companies and a large amount of data are involved. One way to fix this problem is to take a holistic approach to travel booking and expense management with a supplementary tool, such as a booking data aggregation solution. This tool fills in the gaps between booking and reporting, bringing companies more control over and insight into travel spend management. The following profile and case studies illustrate one such tool, Traxo CONNECT, which works with corporations, TMCs, and TEM software providers to facilitate more security and visibility in employees booking activity.

Traxo for Holistic Travel Booking Control

Traxo was founded in 2008, primarily as a consumer-facing application that assisted with itinerary management. The company shifted to a B2B model after identifying a need among organizations for a tool that enabled them to better manage their travel booking data. Today, Traxo offers a dynamic, unique solution that handles data aggregation and travel itinerary processing.

Many companies face a problem in controlling booking activity, as business travelers often book some or all of their business travel outside of their organization’s official channel. For example, an employee may book a flight through a sanctioned TMC or TEM system, but go to another site or platform to book their hotel. Some employees do this because of familiarity, convenience, or a belief that they can save money. Whatever the reasons, these off-channel bookings can create issues for the TMCs, TEM providers, and the organizations and employees themselves. In these instances, the agency in charge of managing travel spend has no visibility into the booking data, as it occurred outside of the official system. In addition, if hotel reservations are booked outside of the system, a travel agency may not be able to locate their employees in the case of emergency, which can compromise a company’s duty of care liability. Traxo’s solution, Traxo CONNECT, solves these problems by aggregating allbooking and spend data processed outside of a controlled T&E environment and software. Traxo CONNECT then integrates the data with the proper system for cohesive, consolidated T&E data management and reporting.

In a typical process, Traxo pre-populates expense reports with the aggregated travel expense details, eliminating the need for business travelers to track down the information from different sources and type it into their expense reports. Traxo’s API integration enables it to feed this data into other third-party systems, such as a booking tool, a TEM solution, a risk management or duty of care service, a TMC, or a reporting tool.

There are three different ways in which Traxo CONNECT aggregates and processes data. One is through its email parsing solution. Traxo provides clients with a private, custom-branded email to which business travelers can forward all travel itineraries that were created outside of an official channel. The data from these itineraries is extracted and integrated with the proper TEM or TMC solution.

Another way Traxo aggregates data is through direct supplier integrations. For example, Traxo CONNECT integrates directly with United Airlines. If a business traveler books a flight directly on United’s website instead of the proper system, they can check a box on United’s booking form and United will send the details of the booking to Traxo. Traxo CONNECT will parse, structure, and normalize the booking data and send it back to the appropriate TMC or TEM solution. Traxo’s other direct supplier integrations include Lufthansa and Booking.com for Business.

Traxo’s third service, which was recently launched, is Traxo FILTER, which allows clients to set up filtering rules within their own email server. Traxo FILTER matches incoming travel booking confirmation emails and hotel folio emails against these settings, as well as against a list of over 5,000 email addresses from travel-related vendors. These confirmation and folio emails are automatically sent to Traxo CONNECT for processing and integration with clients’ systems. Traxo FILTER eliminates the need for an employee to forward a booking confirmation or manually enter the data into the TEM tool.

Because managing travel booking data is a problem across the TEM space, Traxo seeks to support many types of travel-booking related processes and entities. The following case studies, featuring real Traxo clients, illustrate the work Traxo has done with a leading expense management provider and a leading technology platform for booking and managing travel, respectively.

Case Study 1: An Expense Management Provider

Chrome River is a leading provider of travel and expense management technology. The company offers many leading features for controlling the travel and expense management process, from travel plan approval workflow support to reimbursement. However, despite Chrome River’s competitive solution, the company recently identified an area in its functionality that it wanted to upgrade from competitive to leading—the way in which clients managed hotel folios during expense report creation. Although users could forward hotels folios to the Chrome River solution, in order to accurately report hotel receipts in their expense reports, they had to break the folios down by each line item.

In order to streamline this process for users, Chrome River decided to engage with Traxo. Chrome River now uses the Traxo FOLIO solution within its expense management application to capture, structure, and standardize the itemized detail included on hotel folios that travelers receive upon checkout. This occurs when Chrome River’s business users forward a hotel folio email or PDF to Chrome River. The Chrome River solution uses the Traxo FOLIO service to parse the data and automatically import it into the user’s expense report for that trip. This in turn enables Chrome River to associate specific line item charges (e.g., minibar or room service charge) into a master category (e.g., Meals), which provides Chrome River’s clients with a much more granular view of their true travel spend.

Automating this process greatly benefits Chrome River’s end users, who no longer have to manually enter all the itemized details into their expense report. This improves overall usability by making the expense process much faster and more user-friendly, while simultaneously increasing the accuracy of the data.

Case Study 2: A Travel Technology Platform Client

NexTravel is an all-in-one travel management platform that allows companies to book, manage, and track employee travel through an easy-to-use interface. The platforms allow travelers to create profiles, enter travel preferences and loyalty rewards programs, and search for flights, hotels and rental cars, while managers are given tools to create policies, prevent excessive spend, and track trips employees have booked. In general, companies turn to NexTravel to achieve more simplicity, control, and visibility in managing their travel spend.

As is common in corporate travel booking, companies using NexTravel often have employees occasionally that book travel directly from the item providers, such as the hotels and airlines. This behavior prevented NexTravel from fully meeting one of their clients’ top goals—to gain a holistic view into all their travel activity and travel spend. In order to meet this goal and improve the value of their platform, NexTravel engaged with Traxo in 2016.

Today, NexTravel forwards clients’ receipts from off-channel bookings to the Traxo platform, where Traxo parses the receipt details and submits them back to the NexTravel platform. This interaction provides NexTravel’s clients with all of their travel data, regardless of where bookings occur. As a result, NexTravel clients have a full picture of their travel program, as well as the ability to analyze travel data and improve travel management processes.

About Levvel Research

Levvel Research, formerly PayStream Advisors, is a research and advisory firm that operates within the IT consulting company, Levvel. Levvel Research is focused on many areas of innovative technology, including business process automation, DevOps, emerging payment technologies, full-stack software development, mobile application development, cloud infrastructure, and content publishing automation. Levvel Research’s team of experts provide targeted research content to address the changing technology and business process needs of competitive organizations across a range of verticals. In short, Levvel Research is dedicated to maximizing returns and minimizing risks associated with technology investment. Levvel Research’s reports, white papers, webinars, and tools are available free of charge at www.levvel.io

Authored By

Anna Barnett

Research Senior Manager

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Anna Barnett
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Anna Barnett is a Research Senior Manager for Levvel Research. She manages Levvel's team of analysts and all research content delivery, and helps lead research development strategy for the firm's many technology focus areas. Anna joined Levvel through the acquisition of PayStream Advisors, and for the past several years has served as an expert in several facets of business process automation software. She also covers digital transformation trends and technology, including around DevOps strategy, design systems, application development, and cloud migration. Anna has extensive experience in research-based analytical writing and editing, as well as sales and marketing content creation.

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