Hotel leakage on the rise

What can travel managers do to bring their travelers back on track?

A Phocuswright study shows less than 40% of business travelers are going via their company’s recommended providers when it comes to booking hotels. With more than half of all business travelers booking their trips using a mobile device, some persistent prejudices about booking via preferred partners or travel management companies (TMC’s) remain. To stop this trend, BCD Travel researched the causes and risks of hotel leakage and how travelers can be convinced to stick to their company’s travel program.

Hotel bookings outside the travel program bear several risks

There are many risks when hotel bookings happen outside of the company’s travel program. Losing hotel volume means losing negotiating leverage with preferred suppliers. The impact is impressive: booking through a corporate booking tool or TMC delivers an ROI of up to 24%. When there’s a disconnect between air and hotel bookings, it becomes harder to take care of travelers when a crisis happens. “Beyond these risks, companies also lose control of the day-to-day traveler experience and miss out on business intelligence that could be used to improve the program overall”, says Chris Crowley, Senior Vice President Global Program Management & Commercial Services EMEA. Read more about the risks of rogue hotel bookings.

Travelers want to book their hotels as they do it for holidays

As long as companies fail to understand what specific factors drive hotel program success, they will not be able to turn the tide. Engaging travelers in the program is critical. Travelers demand an environment where a wealth of content and information is readily available, enabling independent decisions. “Over half of today’s travelers grew up in an online world”, explains Chris Crowley. “For them, being online is just a normal part of life. Travelers use the shopping and booking tools that work best for them, and those typically are not included in the corporate booking tool. That’s why BCD Travel developed the hotel booking functionality in TripSource. It is modeled after the tools travelers like to use and offers information and booking possibilities for over 600.000 hotels worldwide.”

7 myths on hotel bookings with TMCs

Based on its research, BCD Travel raises awareness by publishing seven myths about hotel bookings with TMC’s. They are not only aimed at travel managers, but help clarify the advantages of sticking to a business travel company for business travelers. Some examples:

  • Myth 1: Business travel companies can only offer accommodation with hotel chains. TMC’s offer a large selection of accommodation, including everything from houses to hotel chains and independent boutique hotels. In addition to accessing the hotels in the Global Distribution System, they also integrate a variety of hotel booking portal content to find the best accommodation.
  • Myth 2: Online hotel booking portals offer better rates. Those online portals follow their own interests. Many of them pre-select the hotels they choose to display, often ranked by the ones that are most profitable for them. It is also worth checking what additional services are included in the price, such as breakfast or free WiFi.
  • Myth 3: Booking a hotel through a travel agency has no advantages for travelers. TMC’s compare the hotel rates on various booking platforms to offer the best price. They also draw up agreements with many hotels, including additional services such as specific room categories and better payment and cancellation terms. If the travelers’ plans change, which is the case for about half of all travels booked by a TMC, the TMC will change the flight and take care of hotel or car rental booking.

Check out this infographic for all 7 myths on hotel bookings or watch the video below with Chris Crowley giving more background information.

 

 

 

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