Hotel, travel agency execs see a rise in corporate travel despite weakening loonie
Taking part in Best Western's Business Travel Summit in Toronto are (left to right): Chris Vukelich, Vice-President, Supplier Relations, Egencia; Dorothy Dowling, Senior Vice-President Sales & Marketing, Best Western International; Ian Race, Senior Vice-President Sales & Account Management, Vision Travel Solutions; and Tony Pollard, President, Hotel Association of Canada.

Hotel, travel agency execs see a rise in corporate travel despite weakening loonie

TORONTO — Do you know what ‘virtual payment’ is? How about ‘bleisure’? The world of business travel is changing rapidly, and new buzz words are just the beginning, according to senior executives taking part in Best Western’s Business Travel Summit in Toronto.

Despite a downturn in the energy and natural resource industries, Ian Race, Senior VP Sales & Account Management for Vision Travel Solutions, says Vision is still projecting an 8% increase in Canadian corporate travel. “The weakening loonie is still not having an adverse effect,” he added. “But there may be a tightening of the belt.” Vision is projecting a further decrease in the Canadian dollar, to 75 cents against the U.S. dollar, he noted.

As travel agents and their clients are already well aware, the decrease in the cost of oil hasn’t lead to the expected decrease in airfares. “Airlines have learned to be disciplined. Capacity is being restrained and demand continues to be high,” said Chris Vukelich, VP, Supplier Relations for Egencia Business Travel (part of Expedia Inc). “The glass half-full view says airlines will take the extra money and reinvest it back in their product and customer experience. The glass half-empty view says they’ll put it in their pockets.”

Tony Pollard, president of the Hotel Association of Canada, said that despite the high cost of flights, the latest HAC survey shows that 38% of respondents intend to take the same number of business trips in 2015 compared to 2014, and 7% said they would take more business trips.

Respondents who said they would be travelling less mentioned the high cost of airfares, and also teleconferencing and videoconferencing as viable alternatives to in-person business meetings. “I’ve heard that noise about teleconferencing and videoconferencing for years but it looks like it’s finally starting to have an impact,” said Pollard.

The HAC survey polled 1,500 people across Canada.

More business people travelling means more hotel nights. Dorothy Dowling, Senior VP Sales & Marketing for Best Western International, said Best Western’s corporate travel business is expected to increase 3% for 2015 “but we’re pushing for 5 – 7%.” Overall Best Western International is seeing record REVPAR, she added.

When it comes to hotel amenities, today’s most frequent business travellers – increasingly, those in the older ranks of the Millennial generation – want WiFi, and they want it to be free, and they want it to work. For years, ‘friendly service’ has topped the HAC survey list of what travellers want in a hotel. In this year’s survey, ‘free WiFi’ finally bumped ‘friendly service’ off the top spot. “Young travellers don’t seem to need as much contact,” said Pollard. “If a hotel doesn’t have free WiFi, then forget it. If you want to annoy a lot of people in a very short time, then don’t offer free WiFi.”

“Managing their travel plans on their phones isn’t a convenience, it’s a necessity for Millennials,” added Vukelich.

Hotels are also seeing more guests book their stay the day of their trip. And increasingly, corporate travellers are tacking a few days on to their business trips for leisure activities, creating the phenomenon known as ‘bleisure’, where travellers combine business and leisure travel in the same trip.

There’s also a trend that Vukelich called “the consumerization of business travel”. “Companies are being challenged by their employees. Employees are asking, why are you making me book this when I can book this other better product for less money?”

The “slavish devotion to negotiating rates all the time is dwindling,” he added.

Vukelich also talked about virtual payment, where every transaction is paid by for a single-use credit card number for just that one transaction. “It cuts down on fraud, and it streamlines reconciliation,” he said.

Not surprisingly, for a company like Egencia, online booking is king. Vukelich said the future for travel agents lies in complex and international itineraries. “Online booking is not expected to shrink. It will grow,” he said.

Dowling added that while Canada was a slower adopter of technology, Best Western is now seeing growth in online bookings in the Canadian market. About half of the company’s volume is booked online. Mobile searches are on the rise too, now accounting for just over half versus desktop searches.

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