Usage of vacation time in the United States has been falling despite research that shows a rested employee is a productive one. When they do make plans, co-workers sometimes bug travel professionals with questions about vacations. They don’t always have answers. A couple of companies born from business travel management are looking to help.
A brand-new spinoff of Ovation Corporate Travel, Skylark is working to draw to its online luxury travel model VIPs who work for Ovation’s business clients and beyond. Not about luxury per se, Employee Travel Specials is a more established firm, part-owned by Travel and Transport. It works with corporate clients directly, particularly on weekend and leisure hotel discounts.
The basic idea is that whether they are rich or super-rich, businesspeople are attractive clients for travel suppliers. By offering private access to special rates — within the corporation’s firewall as with Employee Travel Specials or though a members-only site like Skylark’s — suppliers can discount their vacation products without diluting publicly available rates.
The notion of travel as an employee benefit isn’t new. With the client’s permission, TMCs sometimes waive vacation booking fees or make special rates available to employees. Perks firms like Next Jump and TicketsatWork have been around for years, offering discounts at Disney and the like.
Many companies don’t allow employees to book leisure through the main corporate travel apparatus. Travel buyers are reluctant to get too involved with vacation planning. One fear is that an employee or executive suffers a bad experience on vacation and blames the employer or its service provider. Another concern is bandwidth; travel managers have enough to do. Pointing colleagues to a partner’s leisure services or to a special rate program is about as far as it goes.
“You’re the face, name and authority on travel for your company,” said Cindy Novak, global travel director at Kiewit Corporation. “I don’t have the resources to handle all leisure questions, but I want to offer a good employee benefit.”
“We walk a very fine line with the liability,” said Nova Chemicals senior buyer Mary Taylor. “Legal counsel says, ‘We don’t want that liability. We don’t want you recommending a supplier and then something happens.’ So we’re cautious.”
Employees Travel Special
Nova and Kiewit both use Employee Travel Specials, which via corporate intranets books private leisure rates at more than 60,000 hotels. It charges clients nothing; suppliers pay 10 percent. Founder and lodging industry veteran Sean McCurdy said the company has more than 2,000 clients, most in North America. Setup takes one day. Its portal uses Travelport on the back end. It also books at online consumer sites if there’s a deal to be found, though McCurdy said service issues sometimes arise in those cases.
More than half of the business goes to Employee Travel Specials’ preferred suppliers, which typically commit to a certain percentage off the best available rate and include a valuable amenity or two. McCurdy is proud to report that more than 30 percent of users come back again.
McCurdy about five years ago brought the idea to Travel and Transport, which invested and helped form the company. Employee Travel Specials works with other TMCs as well, including The Travel Team.
Travel and Transport president and CEO Kevin O’Malley said Employee Travel Specials booked 17 rooms in its first month. Now, O’Malley said, each month it’s doing several thousand bookings and more than $1 million in volume.
“Being a big corporate travel agency, it’s hard to find the best ways to navigate in the B2C space,” said O’Malley. “Generally speaking, a proactive approach by the TMC going after the leisure side of a client’s business has always been somewhat taboo. Sometimes you can offer it, but they have to want it and come to you; you can’t market to them. Some clients don’t want their people bothered with it, or they’re concerned they may have a bad experience. There still is some of that.”
Skylark CEO Paul Tumpowsky said these concerns are among the reasons his company is utilizing Ovation’s 24/7 support. He also acknowledged the issue of stress on the travel manager’s time. Tumpowsky described three other challenges to the concept: corporate travel systems are not set up to handle vacations; the business traveler is not always the booker; and the employee is not always the family decision-maker.
He said Skylark is different from similar initiatives in that it’s blending online and offline using proprietary technology. For $400 a year, members access its services by phone, app or web. Skylark is not installing pages on client intranets.
“Where people start, with inspiration, it’s rarely at the corporate intranet,” said Tumpowsky. “Maybe that’s one of the eight to 24 browser windows that get cross-referenced.”
Skylark is offering clients special rates on air travel as well as lodging and “hundreds” of other luxury services. “Every major airline is giving us incredible net deals on business- and first-class airfare,” said Skylark chairman Paul Metselaar, also Ovation’s chairman, founder and CEO. “I raised two rounds of seed capital funding and we’ll try to raise a Series A by year-end.”
Leverage In Leisure?
O’Malley said corporate buyers sometimes try to leverage leisure volume in supplier relationships. “We collect the booking data, report it to the corporation and they can see where their employees are spending some leisure travel dollars,” he said. “It’s not a big enough amount that it will change the course of negotiations, but it’s another thing to throw on the table.”
Informatica global travel manager Rick Wakida said airlines typically aren’t interested, but hotel and car companies usually don’t mind or even encourage it.
At Kiewit, Novak said employees are allowed to book negotiated corporate rates for their leisure trips, and that’s included in discussions with hotels. However, many of the negotiated programs are in locations that are not particularly appealing for vacations. That’s where Employee Travel Specials offers a nice supplement.
Nova’s Taylor said she doesn’t see much benefit to negotiations, mainly due to her company’s particular travel patterns. As an employee perk, though, “We have had a lot of good feedback and people are happy” with Employee Travel Specials.
Whether using such a third party or the TMC’s leisure desk, Wakida advised travel managers to “make it very clear that it’s a personal trip and they’re using a leisure [service], not the group doing business travel. It’s totally separate, personal, and their responsibility.”