With Covid-19 leading to offices closing and meetings and conferences moving online, Sam Ballard asks what the future holds for the business travel industry
Covid-19 has affected every facet of society – but it hasn’t affected every facet equally. From stopping us seeing our families in person, to closing down the pubs, life over the past 12 months has been like something out of a disaster movie – a really long, repetitive disaster movie. If travel is one of the economy’s worst affected sectors – with little to no government support – then business travel is at the sharp end of that downturn, with many companies not even able to benefit from the grants or business rate relief offered to traditional leisure travel agencies. Add to this the proliferation of tools like Zoom and Microsoft Teams, as well as the closure of offices around the world, and you are looking at a series of fundamental societal changes that strike at the heart of the business travel industry. While you can’t recreate a holiday as a virtual experience, the same can’t be said of all meetings. What does all of this mean for the future of the business travel industry?
“We do believe that business travel will resume before the end of this year, but it won’t be until 2022 that we see significant numbers,” explains Clive Wratten, CEO of the Business Travel Association (BTA). “Much depends on the Global Travel Taskforce’s report. For business travel to resume in any capacity, corporates need to have confidence that borders aren’t going to close at a moment’s notice and that testing will be preferred to quarantine.”
Wratten’s BTA submitted a list of proposals to the Global Travel Taskforce that it says would help the business travel sector’s recovery. These include the removal of quarantine requirements for business travellers, the implementation of global standards for testing and health certification and the creation of business travel bilateral corridors. They have also requested that there is a 72-hour window before a country is added to any red list under a traffic light system. These changes will undoubtedly aid the sector’s recovery. However, when it comes to building back better, what do the Travel Management Companies (TMCs) of the future look like?
For Leigh Cowlishaw, global supplier partnership director at The Advantage Travel Partnership, TMCs are seen as a trusted partner during one of the most unstable periods in business travel history. They have an all important duty of care to clients wanting to get back in the air – especially those that are suffering from “employee fatigue” after a year of working from their spare rooms.
She says: “Back in August 2020, market and consumer data company Statista, predicted that as a result of Covid-19 pandemic the global business travel market would see a loss 810.7 billion US dollars, with second and third waves of the virus I suspect this could now be higher, unfortunately.
“Whether a post-Covid world, or we coexist alongside Covid, TMCs are working on delivery of competitive fares and savings, value and assurances aligned to duty of care, coupled with flexible terms, mirroring corporate values. TMCs also have opportunities to reinforce their overall service around travel restrictions, which are likely to remain complex.”
While there is little doubt about the effects of the pandemic on business travel, the question remains about what TMCs can do to bring their businesses back to pre-pandemic levels. Cowlishaw’s reference to “employee fatigue” is a key factor here, with many people longing for the human-to-human contact of actual meetings or the chance encounters at a late-night conference bar that can lead to your next big client.
“Business travel is a broad church and I think the recovery rates will differ enormously for different industrial sectors and use cases,” explains Martin Alcock, owner and director of the Travel Trade Consultancy. “For example, trips related to business-critical functions have generally continued. New business and client meetings are likely to recover much more quickly than travel for internal meetings. Conferences and exhibitions are likely to take much longer given the planning lead times involved.
“Taken together, though, I think you could make a case for an overall structural reduction in business travel of between a fifth and a third as a result of economic contraction and adoption of digital alternatives.”
And this is the crux of the point. The death of business travel has been exaggerated but, perhaps to a greater degree than any other part of travel, it will be forever altered. Why ask your whole sales team to travel 200 miles for a weekly sales meeting if It can be done on Zoom and they don’t have to spend hours on the road? Is your BDM of more use to you in the office rather than on a plane?
While the overall business travel pie may get smaller, there is no doubt that those trips that businesses do elect to take will be seen as far more important. If a trip is seen as a worthwhile investment then firms will want partners who they know and trust with their employees’ welfare. These decisions are unlikely to be taken based on factors like price alone. Personal service, tailored to the needs of each corporate, will be seen as far more important. And that might just be one of the longest lasting legacies of the pandemic.