It’s the one statement that all account managers hear the most, and it’s something most procurement managers or finance directors face when they’ve just appointed their new travel management company (TMC): “My staff find the cheapest deals by surfing the internet.” Now, is there any truth to this remark; is browsing the internet always going to provide you with the cheapest rates every time?
Well the answer is actually yes… and no! Before you sweep your laptop to the ground in a fit of pique, let me explain why.
It’s largely to do with what you perceive as being ‘cheaper’. We all know that on the internet there are innumerable websites/suppliers/promotions etc. So essentially there’s always going to be a time where you can find a ‘cheaper’ deal online (the ‘yes’), whether this is every time though is where the ‘no’ comes in.
Naturally, staff will be the ones booking and travelling the most, experiencing each individual transaction as it happens. For them, finding one cheaper deal out of a handful of individual bookings would result in the above statement being true, but that doesn’t necessarily stack up. Assume you have 5 travellers who have discovered a cheaper hotel rate online and have escalated this forward to you, all of a sudden it feels like they might be right about finding cheaper bookings online. But in all probability, each individual may have made 50 bookings in total and only come to you once about cheaper bookings online. This equates to only 5/250 of bookings where staff members have discovered a ‘cheaper’ deal. Headache starting to fade away yet?
The problem is your staff have actually gone away and trawled the Internet 250 times… Only to be successful 5 times! To make matters worse, they then have to go away and expense the travel manually – something that’s time consuming in itself. Naturally, this time could be spent elsewhere and if completed during work hours, ultimately the resource cost will outweigh the savings made. Furthermore, the best online booking tools now draw in the very same data bookers are trying to find separately e.g. LateRooms or Booking.com, so any discrepancies become smaller and less frequent.
So, on an individual basis surfing the internet can work out cheaper, but let’s take a minute to look at the bigger picture to see how and why individuals straying from using a mandated TMC are usually doing more harm than good.
The foremost consideration is service adoption: If all of your users are using a multitude of options to book travel then do you truly know what your travel spend is? What is being booked? The reasons why? Without this knowledge, we can’t determine the overall scale, we have no way of determining whether a rate is ultimately cheaper or not.
If bookers are finding rates via surfing the Internet, naturally all of your travel will not be consolidated, thereby reducing your leverage to obtain a better corporate rate with the hotels to suit your programme, or route deals for most common flight paths. Having these sorts of rates and route deals protects you against situations where best available rates or flight prices are sporadic and inflated in price, particularly during peak periods and for common locations and routes. If users are booking independently, your ‘buyer power’ is weakened.
Behaviour and policies
As an organisation, how can you understand your bookers’ behaviour and how can your appointed TMC tackle this if they don’t have the information to understand it? TMCs will emphasise that challenging current behaviour is often the way to realise true savings, but if the data isn’t being collected due to rogue bookers, how can your account manager create a comprehensive savings plan or promote the policies which can positively affect your bottom line?
To expand on what was mentioned above, the best online booking tools already have the other booking sites built into their system. Combined with corporate rates, this means you already have many different sources from which to book. If people are still searching online, they’re probably drawing from the same data that’s readily available with their TMC. Overall it’s probably costing more to a company when staff spend working hours wandering the Internet looking for an even cheaper deal.
In short, if out of your 100 travellers, 90 booked with their TMC and 10 of them travelled outside of your TMC’s knowledge but you needed to get hold of everyone instantly, for any reason, which side would take longer to get hold of and send a message to? It would be the 10 (or was it 11?) who have travelled outside of the TMC. Any modern travel management company should offer traveller tracking and traveller alerts, helping you and your travellers stay informed and safe as they travel on business. In emergency situations it’s difficult to put a monetary value on something like this, in fact it’s much more important than pounds and pence – it’s the safety and security of your people that is at risk.
All in all, I would say that if you’re a smaller sized business then maybe finding these cheaper individual deals on the Internet may be more beneficial to you. However, if you’re spending hundreds of thousands or even millions on travel, looking into the bigger picture and utilising the above features as best as possible via a TMC is most certainly the cheapest way to go.