Featuring insights from LinkedIn’s Travel and Event team, Advito’s new white paper offers innovative, yet practical approaches to managing traveler demand and behavior and highlights five proven sources of travel cost savings.
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Engaging travelers to influence their decisions is increasingly becoming a standard in travel management programs. More than ever, companies are considering business traveler engagement and satisfaction as valuable investments. Advito’s new white paper, “Achieving breakthrough savings with traveler demand and behavior strategies” shows how new strategies produce high return on travel program performance, while representing a low-risk investment. Besides increasing traveler engagement, these strategies also improve supplier management, leveraging program data.
Managing demand and behavior starts with understanding business travelers’ motives
“Not enough of our clients are adopting newer but proven ways to add value to managed travel,” explains April Bridgeman, Managing Director, Advito. “Influencing travel demand and traveler behavior are great ways to drive that new value. There’s a simple place to start. Start to understand why employees decide to travel, and start a conversation with leadership about whether or not those reasons are the right reasons. For most companies, 30% to 70% of all travel spend is on internal travel. Maybe it’s time to examine whether there’s opportunity to change behavior and point employees to travel alternatives like video conferencing and virtual meetings.”
An important first step for companies is to understand the demand for business travel within their organization. Employees’ motives for traveling are often neither clear, nor documented. Linkedin, an Advito and BCD Travel customer, conducted a traveler survey to map its business travelers’ needs. The survey results provided valuable insights, which allowed the Travel & Event team to break out several types of travelers into focus groups. By segregating the groups, each gave the LinkedIn team (as well as their preferred suppliers) a better understanding of their travelers and greater transparency into the benefits and shortcomings of their program.
Five proven sources of savings
Five categories can present savings opportunities, while ensuring traveler satisfaction and better program compliance:
- Companies save between 2 and 4% on their hotel spend by making additional content accessible online. This extends travelers’ choice of hotels beyond what’s available through the company’s negotiated rates and its global distribution system (GDS).
- According to Advito, it is possible to reduce internal travel by 10% by changing behavior and demand. Qualitative virtual encounters can replace face-to-face meetings thanks to digital collaboration tools.
- Price assurance strategies can generate 1-2% incremental savings on air and hotel spend.
- Dynamic Performance Management enables program improvements through active monitoring of spending. This happens in real-time, outside of the standard sourcing process.
- Dynamic policy allows real-time policy adjustments. Incentives reward travelers who make smart spending decisions. Both techniques are further potential sources of savings: although traveler incentives may not work for all companies, evidence shows that they can drive an incremental 8% – 12% net cost reduction.
Further long-term benefits of these new strategies include achieving sustainability goals through reduced carbon emissions, improving employee retention and acquisition, and getting broader organizational support thanks to work-life balance initiatives.