Pricey tickets hold back leisure, but business travelers getting back on planes

by Tom Johansmeyer on

The past two years have been nothing short of severe for the travel business, especially the airlines. Fortunately, it looks like luck is turning. Barney Harford, President and CEO of Orbitz Worldwide, says that the airline sector appears to be on the mend, at least for business travel. Consumers, on the other hand, aren’t buying back in as aggressively, as high fares are battling with continued economic constraints for wallet share.

The average airfare for domestic travel is up 10 percent, according to Hartford, with international fares surging 17 percent. He notes to CNBC:

“We are seeing … a moderation in the increases in air tickets that we were seeing in perhaps May and June, where we saw some really stronger increases in air tickets,” Harford went on to say. “We’re hopeful that we’ll see an increase in capacity in the airline sector, which will drive some moderation in (the price of) airline tickets.”

Nonetheless, you can still find some bargains out there, according to Hartford. Look for the best values in Caribbean destinations.

[photo by emrank via Flickr]

Business travelers told to be logical with tickets

by Tom Johansmeyer on

In a move that’s shocking because it’s sensible, corporate travel managers are pushing business travelers to make decisions that aren’t stupid. In the past two years, 75 percent of companies in North America have changed their travel policies, with cost-cutting a major motivation. First and business class have become more and more elite in the white collar set, thanks to more restrictive policies, in an effort to put more business travelers in the sky at as low a cost as possible.

But, the need for cost containment isn’t resulting in idiocy. Rather, employees are being told to look for the “lowest logical fare.” Basically, this is “the lowest-priced fare that doesn’t cause travelers to take wildly circuitous routes, cause them to miss important engagements, incur an extra night in a hotel or lose productivity,” reports USA Today.

The report continues:

North American companies, which spent an estimated $48.7 billion on airline tickets in 2009, could save almost $30 billion combined annually if they instituted and enforced stricter travel policies that required non-refundable tickets or the lowest logical fare. That’s according to the survey’s publishers, Egencia and the National Business Travel Association Foundation.

Christophe Peymirat, vice president of global marketing at Egencia, Expedia‘s corporate travel arm, observes, “Based on our research, companies … can save as much as 38% by encouraging travelers to be flexible.” Departure times two hours before or after the desired flight and less-expensive connecting flights (rather than non-stop) are ways this could happen.

Business travelers poised to take fun out of social media tools

by Tom Johansmeyer on

Where are you looking for the latest travel information? Well, if you’re a business traveler, especially with a mid-sized company, you’re probably turning to social media tools. And, that makes more than a little sense, given the reach of platforms such as Facebook and Twitter (the former of which pierced the 500 million-user mark this week).

According to the latest research by American Express Business Travel, the white collar crowd is turning to social media more and more to stay in touch with other travelers and keep up with travel industry developments. This is just the beginning, however. Down the road, many expect to use these online utilities to engage more directly in business, particularly through webcasts, forums and online video.

Basically, businesses will figure out how to put to work what kids have been doing for years. The good news? Since social media tools will become synonymous with work for this population, wasting time on Twitter won’t be fun any more, and the boss will recapture some productivity.
According to Christa Degnan Manning, director, eXpert insights, American Express Business Travel, “As businesses around the globe alter the way they communicate and receive information from clients and prospects, social media has also proven to be a useful and effective tool to share pertinent information with employees and drive change in organizations.”

Half of the respondents to the American Express Business Travel survey indicated that “they use social media to some extent to support travel management today,” and the proportion went up to 59 percent for mid-sized companies (defined as $3 million to $10 million in air volume).

So, why do they use social media tools? Forty-four percent say they want to stay up on the latest travel information, with 43 percent reporting that they can “learn and communicate best practices and reduce business travel costs”. Other priorities include finding preferred vendors and services (42 percent), hunting for travel patters that could result in improved rates or services (34 percent) and encouraging networking among travelers (26 percent).

What’s most horrifying about this research? Well, it’s that social media tools are becoming useful …time to kill that FarmVille account, right?

Top five reasons passengers are getting nastier

by Tom Johansmeyer on

As much as passengers complain about airline employees (and we do), we give them reason to complain about us. And, we complain about each other. There’s clearly no risk of a love-fest breaking out in the gate area, and if you look closely, you can see how the situation will only get worse. There are all kinds of conditions set to make air travel miserable (well … more so), and that means everyone involved will wind up getting a little nastier. Here are the top five reasons why:

1. We have no space, and there will be more of us on the plane: the lack of legroom isn’t exactly new, but everything around it is going to get worse. In the wake of the financial crisis, airlines cut flights to shave expenses and boost revenue per available seat-mile (RASM). This means the odds of having an empty next to you have dropped.

2. There will be more of us in the air, too: the economy is turning the corner, and businesses are starting to spend some money again. Look for more business travelers on the road, which will make flights even more crowded.3. We’re thinking about value: because of economic conditions (including high unemployment), we’re now acutely aware of what every dollar we spend means. A reclining passenger translates to the erosion of a purchase – “That’s my space!” We want as much for our money as possible. So do the people next to us, in front of us and behind us. Elbow room is a zero-sum game: there will be losers.

Want to make the situation worse? The coming increase in passengers will likely bring with it an increase in fares. So, an economic recovery means we’ll effectively be paying more for less. I don’t know who fails to crack a smile over that!

4. Let’s not forget about the service: beyond economic conditions and market drivers (e.g., RASM), there is another airline factor at play. We need to be realistic, here: this industry has a long-standing reputation for delivering abysmal service. Passengers know this and expect an uncomfortable experience, so they get primed for it. Remedying this will take concerted effort by airlines – and it will require years of unrequited love.

5. There’s no shortage of blame, and it’s everywhere: airline employees think passengers are unreasonable, demanding and often inappropriate. Passengers think airline employees feel (and act like they’re) entitled, self-obsessed and controlling to an unwarranted degree. Our zeal to point fingers only makes the situation worse for everyone. Passengers are getting nastier because we expect the worst, and crews expect nastier passengers. We’d all rather win than fix the situation.

[photo by Pink Sherbet Photography via Flickr]

Brit travel abroad plunged: blame the business travelers

by Tom Johansmeyer on

The homes in Britain must be incredibly cozy – because nobody left them. Travel from the UK fell to its lowest levels since the 1970s, thanks to the hangover from the September 2008 financial crisis. The number of people crossing a border dropped 15 percent year-over-year, with only 58.6 million visits abroad taking place.

As usual, the business traveler is stuck with the blame for this. Cell phone-toting, laptop-wielding road warriors in the UK allowed travel to plummet almost 25 percent from 2008 to 2009. Now, it’s not just that travel budgets got a little tighter. You also need to keep in mind that hefty layoffs thinned the herd of potential business travelers.

[photo by Dimitry B via Flickr]