Louise Miller On Considerations For Online Booking Tool Selection

From The FieldWhen we at The Company Dime speak with travel managers, online booking tools almost always come up in the conversations. Everyone has an opinion about deficiencies, features and suppliers. Setting a strategy starts with knowing traveler habits and content needs, before getting into how travel management companies support specific tools (or don’t). There are hotel-only specialists to consider, as well as each provider’s mobile capabilities and several other factors. Louise Miller, Areka Consulting’s managing partner in the Americas, lays out questions travel managers should ask as they navigate an evolving market.


With the online booking landscape changing like the weather, putting the right content in front of travelers or their surrogates is undeniably a priority. Aligning that content across various channels — the web, mobile, the TMC’s desktop, the online booking tool and hotel booking tool — is getting more difficult.

When considering the feasibility and value of online booking, the first question should always be about content and what is relevant and accessible to travelers based in each country. In many markets the content is so fragmented that any single online tool may not provide enough coverage for the entire world. Furthermore, many travelers do not see content parity across the managed channels in your program. The agent, the mobile app and the web-based OBT views offer different “top” and “lowest-cost” options for the same request. This erodes credibility and drives travelers to consumer sites.

Having control over what’s displayed to employees can depend on decisions companies make about their supplier relationships.

Louise Miller, Areka Consulting
Louise Miller, managing partner in the Americas for Areka Consulting
Image: Sara Hanna Photography

How do you select from the array of independent online tools that can pair with a variety of TMCs, or some of those TMCs’ proprietary tools? What about the “closed” online travel management platforms that avoid or refuse to support the independent tools? What should buyers consider when navigating this complexity in order to leverage innovation for better travel programs? Is it best for your program to hold separate agreements with online booking providers and TMCs?

Here are some questions for companies with less than $50 million (generally) in annual T&E spending:

• Which preferred suppliers do your travelers use and at what savings levels? The more they already use your preferred airlines, hotels, ground transport providers and booking channels, the less likely they are to spend significant time shopping in unmanaged channels.

• Are travelers “shopping” for business travel and where? What’s the usage of your managed channels versus rogue bookings through unidentified channels? This varies significantly by market. For example, the United States typically has the highest number of hotels booked via managed channels, over 50 percent. In most other markets, it’s rarely above 20 percent. When thinking about your next steps, the baseline or what’s happening today is always critical.

• Is there an opportunity to leverage incumbent payment, expense and travel providers? Do you use a hotel sourcing service that also sells a booking tool? Does your expense provider also offer a booking tool? Does your TMC have mobile booking that is a feasible alternative to the traditional OBT?

• What sorts of policy controls are you looking to preserve or improve? Pre-trip approval (passive or active) can be complex to implement consistently across online and offline channels, and in all countries served by your program. Capabilities vary widely across TMCs, OBTs and hotel-only booking tools. How are your preferred suppliers and other preferences displayed to drive policy compliance?

• How effective and mature is your duty of care program today? If significant numbers of bookings are outside your managed channel(s) then looking at new channels or alternatives to your current channels may be worthwhile. This can be the single biggest driver in securing senior management buy-in to explore new or more booking options. For example, if your online booking tool isn’t attracting travelers to book hotels and you don’t have a mandated policy, offering a separate hotel booking service may make sense for your program. There are independent and TMC-sponsored options, and a growing list of success stories.

• Do you have sufficient visibility into spending to allow for the desired level of program management? If you are happy with the proportion of bookings and spend in your managed channels, then introducing a new solution or replacing the ones you have might present more risk of a disruption than value-add.

For companies with T&E spend greater than $50 million, along with the questions above, consider whether you should own your online booking destiny. Many large programs have made this move. When Areka Consulting looked at the 150 top-spending multinational companies, we found more than one-third held some type of direct contract with an online booking provider.

If your spend is large enough, especially in mature markets, you may be able to negotiate competitive pricing with independent online booking tools on your own rather than relying on your TMC’s reseller program. You also may have more control and transparency with a direct OBT deal.

Booking more hotels through managed channels is a big priority for most companies. It should be a consideration as you evaluate OBTs and other managed channels. Many companies are paying OBT fees for hotel-only reservations when using their TMC reseller agreements and, in some cases, also paying a TMC hotel-only service fee on top. For the past few years, some TMCs and hotel booking agencies (HBAs) have made available free tools and services with content similar to what’s available in your OBT. Another way to avoid paying too much for a hotel-only booking is the direct OBT deal, where sometimes the fee structure is different (bundled with expense versus pay per reservation).

Some companies with less than $50 million in spending have combined booking and expense with one provider. However, system administration and advanced technical support may be challenging in smaller-spend markets. Many TMCs can help with resources and service levels. Some companies opt to go direct in their big-spend markets and stay on TMC reseller deals in smaller-spend markets – or cross-utilize OBT sites across borders.

If your online booking tool is provided by your TMC rather than through a direct contract, make sure you specify in your TMC agreement the controls you want. Actively monitor your TMC to ensure it’s meeting your expectations. Remember that TMCs have significant pull with the independent OBT providers, from whom they secure volume discounts.

Contracting with a TMC that uses a proprietary tool brings simplicity in terms of accountability and cost.

Choose your combinations carefully. Consider what incentive these companies have to work together on your behalf in the foreseeable future. Is your company a supplier to any of the TMCs or online booking providers you are looking at? How will your voice be heard as the booking tool providers and TMCs develop and enhance products?

If you are looking for simplicity, don’t get your hopes up. Hotel bookings may be the best example. The most common options used during the past 10 years have not kept up with consumer-oriented options, thus most programs lose 50 percent to 80 percent of hotel bookings to unmanaged channels. Technology innovation is happening fast, and the online booking landscape will continue to change.


Related
Hotel Content Aggregators Find A Place In Corporate Programs
Evolving Content Needs Highlight Differences Among Self-Booking Tools
Consulting Firm Puts Incumbent Concur Travel To The User Experience Test

Share
Louise Miller

Author: Louise Miller

Louise Miller brings more than 30 years in the travel industry and 20 years in executive leadership to Areka Consulting. Her knowledge and experience include technology, product innovation, commercials and finance, marketing, account management and talent management. Louise started in the airline and car rental industries, then spent more than eight years in buyer roles for aerospace and financial service companies. At BCD Travel for the next 23 years, Louise held executive level positions and reported to the CEO. She earned her Bachelor of Science - Summa Cum Laude from LaRoche College in Pennsylvania. Louise has two adults sons and, with her husband Richard, hosts several international high school and college students from Latin America. Connect with Louise on LinkedIn.

Comments

avatar
  Subscribe  
Notify of