Time was when managing car spend was pretty straightforward. But today this category is more complex, thanks in large part to the rise of the on-demand economy and the technology that drives it. But it also brings some new and exciting opportunities for Phat Data in your managed travel program.
Long gone are the days of just sourcing a car rental company and going merrily on down the road. We now have to take into consideration the impact of factors such as sharing economy providers like Lyft and Uber, rental car companies that offer hourly rentals, and even chauffeured car services which are getting into on demand technology.
Sure we have always had to deal with car rental, taxis and black car. Back in the good ol’ days, we knew our car rental spend and sourced a supplier for our needs. We also knew our black car spend and – poof! – we could source that too.
But this is a new world; now the data is more volatile and it becomes harder to source. We have to think about ground transportation differently and we need Phat Data to help us.
The great thing about on demand ground transportation in whatever form it takes is that it is convenient and easy to obtain. Travelers love it. Buyers need to love it too – or at least embrace it and leverage the data behind it.
As buyers begin to think about the impact that the on demand services are having on the travel program, they should begin by taking a look at their car rental category. If a traveler is leaving a car in a parking lot all day, does it make more sense for them to hop in a Lyft or Uber, freeing them to hail their rides as they need them? Does it become less expensive than car rental, fuel costs, not to mention all the taxes and fees? Is it safer in a city where the traveler has never been? And do travelers even want to be burdened with the whole car rental process?
Travel buyers should start by looking at their traveler’s rental patterns and then determine whether alternate transportation might be a better option. Sure, buyers have been looking at things like how many miles someone drove on a rental, parking costs, etc., for years. But what’s changed is the availability of convenient alternatives; they just weren’t in the marketplace like they are now.
Sharing DataNow on to the data behind the ride sharing providers. The two prevalent providers in the US are Lyft and Uber; each of them have a business offering and reporting. Buyers should be signing up for these providers’ business programs so they can capture the incredible amount of data these services generate. It is the information about how your travelers are using ride sharing that turns this category into Phat Data.
If, as travel buyers you are taking the data from car rental utilization and comparing that to ride sharing utilization, you may find the perfect blend of when to use a car rental and when to use ride sharing.
Knowing this information can answer the “So What?” question of the impact of ride sharing on your travel program.
Adding this information into your overall data strategy allows you to then re-think the language in your policy for the ground transportation category. Armed with this knowledge, you can provide your travelers with better direction on which service to use and when. This will drive down costs and help to increase compliance.
We can’t forget to add into our strategy the utilization of chauffeur/black car services. Depending on your company’s location and culture you may have a lot of black car services in your program. If it is a big part of your program, these providers are able to deliver some good data as to the who, when and where of your ground transportation.
There may, however, be a piece of the pie that is missing, and that is market dynamics. Are more of your travelers moving to black car services because these providers are becoming less expensive and more convenient? Does this change the traveler’s expectations? Does the choice come down to pricing? Yes, black car may still be less expensive in certain markets than a car rental, but more expensive than a Lyft or Uber. In order to really tell a complete story, buyers need to start considering on demand services and how to capture that data and integrate it into their overall strategy.
In a fiercely competitive marketplace, the influx of on-demand black car options is growing and even legacy providers are hopping on the band wagon, launching their own on-demand apps to counter the ride sharing services. These higher-end on- demand services could have an impact on the managed travel program, especially with the ever-growing focus on the traveler experience.
This isn’t your grandparent’s ground transportation anymore. Technology and convenience combined with cost savings are driving travel buyers to look at new ways to tackle getting from Point A to Point B. Data is becoming more accessible to the both the buyers and the travelers. By taking a holistic look at the different sources of transportation, then using the data gleaned from this exercise to support your strategy and tell your story, you’ll have the tools you need to make an amazing impact on your travel program.
Here are some examples of the types of data that you can incorporate into your analysis: length of car rental, miles driven, cost per mile, distances traveled via ride sharing, number of trips, time of day utilization, position within the organization, number of individuals, parking costs, taxes and fees. Taking data like this and determining the right mix of rentals, taxis, ride sharing and black car will inform and educate your travelers on the most cost effective and efficient means of transportation.
Yes, the category has gotten more complex and buyers are being challenged by travelers, but embracing it and taking a deep dive will be worth the ride. Travel buyers will uncover great opportunities to create a more dynamic ground transportation program that is filled with rich Phat Data.
Jennifer Steinke is manager, corporate travel for Dycom Industries, and an industry thought leader with over 27 years experience managing corporate travel. She holds an MBA plus Certified Corporate Travel Executive (CCTE) and Global Travel Professional (GTP) certifications from GBTA. Jennifer strives to deliver innovative and thought provoking ideas to the corporate travel industry.