To get all the moving parts of a hotel program working right, the devil is in the details
Travelers hold the keys to a successful travel program. But to buy in, they need to understand what it’s for, how it works and why it’s a good for them and the business. However many times travelers stray from the path of compliance, especially when it comes to booking their accommodations.
After all the effort of completing an RFP, a hotel program is put into place to maintain policy. But the devil is in the program details. As many travel buyers know, the issues are perennial, including making sure the right rates are being offered consistently and fending off seemingly attractive – but often misaligned – direct booking rates and loyalty offers.
A recent study found over four in five travel managers surveyed (81 percent) have a mandate in place requiring travelers to book travel through company tools and platforms. Still, according to the survey from the Association of Corporate Travel Executives in conjunction with American Express Global Business Travel, adoption among travelers doesn’t reflect that mandate, and a full 5 percent of respondents admit their program’s adoption rate is currently lower than one in ten.
This indicates despite corporate policies, there are still real challenges for travel managers to promote travel policy adoption. The study revealed less than half (47 percent) of respondents communicate regularly with employees about their booking tools. To engage with travelers about the benefits of their travel program requires ongoing education and enhanced marketing tool kits for travel managers.
All the fine points of a travel policy are irrelevant if all the parties are not aware and up to date on them. Virginie Pouget, global head of consulting for Expedia, says it’s important to include other managers who are in part responsible for a travel budgets in the conversations around compliance. They will be able to define travel priorities and help reduce travel when there’s not a strong business case for the trips.Perennial Policy Problems
One of the biggest reasons travelers book hotels outside booking tools is the perception that they’re getting a better price someplace else, says James Filsinger, CEO of Yapta. Most travelers want to know they are getting the best rates. By using dynamic price tracking solutions like Yapta’s RoomIQ, travel managers have been able to effectively increase traveler compliance.
Without access to all rates in one place, says Wes Bergstrom, vice president-global supplier relations for American Express GBT, travelers will continue to question the value of the travel program. The best way to keep travelers shopping and booking within the program is to offer more options in the tool.
For example, he says, GBT brings in corporate negotiated rates, preferred extras, chain loyalty rates, Booking.com and Expedia content to offer options, save money and keep travelers from challenging the value of the overall travel program.
For the first time, Pouget claims her company is able, with the help of a filter, to stop a non-negotiated rate from showing up in the system to prevent it from being booked. “We also let hotels know the buyer is getting these reports,” she says, “and that elevates everybody’s game.”
Many problems around hotel programs involve the sheer amount of time they take – from the initial RFP process through monitoring rate loading to expense reporting. A lot of effort is being made to deal with that. Steve Reynolds, CEO of TripBAM, says solutions that are not “touchless” use up the majority of savings simply fulfilling the transaction.
On the supplier side, Tamara Laster, head of corporate transient sales for IHG, says traveler preference and behavior will dictate how successful a travel program is. Using loyalty programs not only builds a personal incentive to remain compliant to the program but can lower the overall spend for travel, Laster says.
“We must understand the why and know if they are truly costing the company extra money,” advises Gabe Rizzi, president of Travel Leaders Corporate. An example, he says, would be a married couple in the same company who stay in the same room and upgrade. An expense report shows this costs more, but if you look at the bigger picture, the upgraded room is actually cheaper than two standard rooms. Basically, the TMC needs to understand the data that drives the compliance and educate their client on that.
Peer group benchmarking is critical, says Rizzi. With this feature clients are able to look at other businesses in different industries to see how their hotel spend compares.Countering Pain Points
A business traveler should be able to log on to their booking tool, whether at the office or on their mobile remotely and see a tailored selection of rooms and rates based on their employer’s policy, says Brian Zacker, head of global sales, RoomIt by CWT. So he maintains it’s important to work with TMCs and online booking tools that are investing in improving the digital experience for travelers to promote greater hotel program compliance.
Hotel spend has been a historically challenging area for TMCs, says John Morhous, chief experience officer, FCTG Corporate Brands. Typical traveler behavior is to book an airline ticket first, and a hotel later. Because of that, classic booking tools and efficiencies break down, Morhous says.
The Upside platform, in which the company has invested, leverages technology to gently nudge people to make in-program choices, using an Amazon-like shopping cart functionality for buying travel, so it is easier to add a hotel to the “cart” at a later date.
Pouget argues the biggest pain point for travelers is the expense report. While it’s important to adopt processes that drive savings, the best solutions also drive customer satisfaction. That might mean end to end procure-to-pay systems that make it easier for the traveler.
Jennifer Dzialo, vice president of corporate land product, Flight Centre Travel Group – Americas, says her TMC’s goal is always to make it easier for a traveler to determine what is out-of-policy and what the repercussions are for booking outside policy. For clients that are especially focused on policy adherence, the best option is to leverage the expense process and to consistently report repeat offenders.Travelers Want Some Satisfaction
When you ask your employees to go on the road, it is important to remember satisfaction is different from preference, Dzialo notes. She says as long as travelers feel they are being taken care of, they will generally defer on the exact style of the selected hotel.
Dzialo also points out travel policies are becoming more valuable when recruiting new employees. Thanks to social media, travelers are increasingly savvy and have a heightened awareness of policy standards and best practices.
A hotel becomes a corporate traveler’s “home away from home,” says Rizzi, and a bad hotel experience can impact the success of the business trip. Traveler satisfaction is a critical factor in hotel sourcing. “Understanding travelers’ needs and travel patterns are an important part of the service we provide,” he says.
Amenities count, too. Research from RoomIt and GBTA shows more than three quarters of business travelers prefer to book rates that include multiple amenities, even if the rate is slightly higher. Three quarters also agree purchasing a higher bundled rate would make the expense reimbursement process easier.
Hilton has created an entire department to use data and analytics to drive higher guest satisfaction, as well as to test the effectiveness of the company’s marketing, forecasting and other processes. Dak Liyanearachchi, chief data and analytics officer, says by using tools such as machine learning, his team can monitor millions of reviews, surveys and social media to quickly drive product strategy and even quality assurance. Social media is a powerful indicator of when something is good or bad, he says, and can help steer managers to a problem.
Sometimes, finding a non-traditional property adds to traveler satisfaction. Cara Banasch, vice president-sales for Omni Hotels & Resorts, says more buyers are sourcing the brand as an additional option to large volume suppliers. They recognize while they may want to leverage into consolidated brands, it is sometimes better to offer alternatives.
Similarly, Kenan Simmons, vice president of Small Luxury Hotels, says his network helps keeps travelers within policy by auditing and preventing hotels not in the program from loading rates under preferred rate codes. It also instructs hotels not to make any offers to guests different from those set by a program “as we know the rates established were done carefully and strategically.”
In today’s market, being different can be a positive for travelers – especially in industries like fashion, entertainment – and even finance, adds Joel Rosen, president of GFI Hospitality, which operates boutique and non-traditional properties like the Ace in New York.
Bottom line: a hotel program is a complex machine with many moving parts. There will never be a clear solution to all its issues, but there does seem to be movement toward dealing with perennial problems.BTE INSIGHT
Business Travelers Prefer Digital Bookings
More than three-quarters of business travelers (78 percent) would rather make their hotel reservations digitally, according to new research from CWT. That’s a stronger preference for digital interactions than for booking flights (69 percent) or making arrangements for ground transportation (71 percent). However, travelers are more receptive to speaking to a person face-to-face when checking into their hotel (46 percent) and checking out (51 percent). CWT’s research also shows a significant percentage of travel is still booked through a computer screen – 45 percent in 2019 versus 53 percent in 2018 and 52 percent in 2017. But smartphones are catching up: 41 percent in 2019 versus 34 percent in 2018 and 32 percent in 2017. Tablets rank third with 11 percent, while only 2 percent of business travelers say they get booking help from a person.