At a time when companies are cutting travel budgets and grounding business travelers, some corporations are turning to online booking systems, with adoption rates entering into the 80% to 90% range.
At American Express, this trend has increased the number of bookings through the corporate online channel 500% year over year.
The channel accounts for 6% of all corporate travel reservations at American Express, and the company said it expects that percentage to double by the end of the year.
“Travel managers are looking for us to use technology to reduce transaction costs,” said Rich Miller, American Express vice president and general manager of global interactive travel.
Jim Lee, director of global travel services at Honeywell, an American Express client, said the company trimmed $4 million off its travel budget in 2001 because of online booking. Lee added that his travel management bill to American Express was cut in half.
p>The average cost savings on airline tickets booked on Sabre BTS—Honeywell`s online booking system—was 10%. Lee also attributed an 8% reduction in hotel spending to online booking.
Honeywell`s adoption rate for online booking is now at 80%, and the goal is to reach 90% by the end of June.
Lee said the 90% figure is a theoretical maximum because self-booking technology is not advanced enough to provide the best fares for multileg international trips.
But Aetna, which doesn`t travel much internationally, is now at 92% and expects to reach 98% by July, said Jeanne Young, director of strategic sourcing for travel at the Hartford, Conn.-based insurance firm. Young said that as part of the company`s effort to cut travel spending, employees were required to book on Corporate Travel Online—American Express` online booking tool—starting last June.
The company had been using an online booking system since the beginning of 2000, and the adoption rate reached 50% before the mandate. Of the 15,000 travelers at Aetna, only 17 aren`t required to use the self-booking tool.
Like Lee, Young said the firm`s transaction fees were cut in half in 2001. The average airline ticket price dropped 15% year over year.
Before mandating use of the booking tool, both Aetna and Honeywell used incentives to encourage employees to pass up the telephone, such as free travel for travel arrangers who booked the highest percentage of tickets on line.
Honeywell also has used less gentle methods to get employees to switch to online booking.
The firm participates in American Express` Fee Allocator program, in which the transaction fee is a line item on their credit card statement.
In Honeywell`s case, the company chose to make the online booking fee zero and the telephone booking $30, with Honeywell reconciling with American Express after the fact.
Corporations can achieve optimum savings in online booking if the process is automated from start to finish.
When asked what technology clients are requesting to further improve the online booking process, American Express talked about three topics: meetings, Web fares and global deployment.
“We recently had a client advisory board meeting, and 14 out of 15 companies said meetings was a priority,” said Miller.
“They want travelers to be able to register for meetings and book meetings travel [on the same system].”
Corporations also want the ability to search for and book special fares on airline Web sites and online travel agencies, while capturing those segments so they don`t lose travel data booked outside the CRS.
“We are working on a way to incorporate those fares on the online booking systems and with traditional methods of booking.”
Lee said Honeywell wants to implement online booking in other countries.
Miller said the greatest barrier to accomplishing that is supporting different languages.