Business travel has been hit head-on by the COVID crisis. Experts
report that it will never pick up to 2019 levels, and it is commonly said
that Zoom killed business travel. I personally believe that business travel
will recover but with different priorities.
Although video conferencing may replace most internal
meetings, it will mainly replace phone calls, not human interactions. Other
factors, like high-speed trains or corporate approval processes, existed before
the pandemics and have already affected business travel patterns. Also, sustainability
was already on top of the air travel agenda before COVID, and it will remain
there. We must look elsewhere for the future changes in business travel post
pandemic.
Travelers want attention
What used to matter most to business travelers for air
travel was schedule and price and for hotels was location and price. All search
systems were initially designed based on this assumption.
With health and sustainability now on top of the agenda, we
can assume that customers will want to know that airlines care about them. But
will they hold them accountable and require attention at every flight?
Subscribe to our newsletter below
I expect corporate customers, on behalf of travelers, to
require airlines’ attention at three stages: when selecting a preferred
supplier, when planning for a trip and during the trip itself. First, a
preferred supplier should be able to demonstrate its commitments to health and sustainability,
in all the meanings that are relevant to the corporate. For sustainability this
includes, for example, new aircraft in the fleet with lower CO2 emissions or banning
single-use plastics.
Second, when a traveler plans for a trip, the airline will
need to provide all the relevant information and services, e.g. insurance in
case of health-related travel restrictions or CO2 emissions for the flight.
If we include accessibility as well, the display should include wheelchair access for each flight including connections. Third, during the trip, the customer will expect to have a safe, touchless experience.
Mindset shift
This attention to health and sustainability represents a
mindset shift. We thought of air travel as a commodity, highly efficient and
industrialized. But it’s more than that, and the current crisis has proved it. Air
travel is a service that requires attention or care from the carriers.
When people looked for the “Uberization” of air travel, they
thought it meant that pilots would fly their own private aircraft. Actually, Uber
is not only about creating a network effect without owning assets.
It’s also about a mindset shift: would people trust unknown drivers met on the internet to drive them home safely? Uber managed to create a trusted relationship with the right guest experience when meeting with a five-star driver, compared to a ride with a professional taxi skilled at finding a path across town.
The Uberization of air travel is coming from the latter, this mindset shift from not only getting safely from A to B, but also caring about experience, health and environment.
Can airlines deliver on the need for attention?
The next question is about the ability of airlines to deliver. Naturally, there will be inertia, some airlines will remain focus on their traditional operations, they won’t care, and it will probably be okay for some customers.
But I believe that most airlines will care, and some have
already started their “customer-centric” and digital transformation, to be able
to understand each customer’s expectations and deliver accordingly. It’s a
challenge when carrying, and caring for, millions of travelers, but it’s worth
addressing it.
The mindset of airlines who care about customers makes them behave
like retailers. They focus on the ability to provide the right offer at the
right time. It means, for example, that if there is an alternative mode of
transport that meets the customer’s requirements, the airline should connect to
it.
Such airlines will provide detailed and transparent information about the fare and experience, which will ensure that all the sellers and intermediaries can provide the same level of information. Customer-centricity is tested when a decision needs to be made: should an airline keep dealing with a seller that cannot provide the relevant information to the customer? Think about “caching,” where customers don’t see the offer made for them by the airline.
The new travel marketplaces
What if the corporate and the airline agree on the terms of health,
sustainability and care, but cannot implement it, for technical and commercial
reasons related to intermediaries?
If we were to invent and build from scratch a marketplace
today, to connect corporates with travel suppliers, what would it look like?
Forget all you know, unlearn the legacy, just imagine what’s really needed to
make it work.
This marketplace is open to all and completely transparent,
without hidden fees or else. This is called “open-source software.”
The agreements between corporates and travel suppliers, as
well as each booking, or order, are coded into secure and shared databases, and
can be executed automatically, without the need for an intermediary. This is
called “smart contracts.”
Once this new marketplace is in place, many services can be developed
around it. The key benefit is that nothing stops a corporate from accessing any
content from any travel supplier and vice versa.
The future of business travel
Is this science fiction? Not anymore. Several companies have explored the potential of blockchain for travel distribution.
On the payment
side, OTAs like Travala accept payment in cryptocurrencies, and even
UATP
announced a partnership to enable payment in cryptos
. But replacing credit
cards by cheaper and safer payment methods is only the tip of the iceberg.
A company called Winding Tree offers such a travel marketplace.
It provides peer-to-peer connectivity between corporates and travel suppliers.
Access to relevant travel information is direct, shopping is transparent, data
is exchanged directly between two entities only, and settlement can take place
instantly.
Other companies are working on disrupting travel distribution too,
providing identity management, connectivity, payment and settlement options in
one open-source platform.
For a business traveler, the experience will change at the
time of trip planning, having relevant information about health protocols, CO2
emissions, wheelchair access or special allowance granted to the company. The availability
of this information is no longer limited because the OTAs or GDSs don’t benefit
from displaying the relevant information.
Technology enables the display of
this information from all suppliers to all customers at scale.
Indeed, business travel may not get back to 2019 levels if
nothing changes. COVID, work from home and video conference will have some
impact on travel demand. At the same time, other trends are at play, like health,
environment and personalized travel experience.
Information, care and personalization
will restore traveler trust. New travel marketplaces will enable this
personalization of travel to happen.
The recovery of business travel may happen sooner than we think.
This time it will be sustainable and personalized.