Monday, June 24, 2024

How TMCs are preparing for a post-pandemic travel growth

Travel Management Companies (TMCs) are reinventing themselves and strategising to not only recover, but also to rebuild and grow in a new world of business travel.

In its latest e-book, “Rebuilding Business Travel”,  Amadeus highlights the challenges facing TMCs, the new opportunities emerging in the wake of Covid and practical solutions for recovery and growth.

The report gathered insights from 250 TMC executives around the world, through a quantitative survey and deep-dive interviews on the busines travel industry outlook and recovery strategies for 2022.

New opportunities

Half of the respondents (49 per cent globally, Asia Pacific 57 per cent) believe a shift from unmanaged to managed business travel is underway, partially because of the rising logistical challenges of travel and high chances for disruption, as well as the increased focus on optimizing travel spend.

There is also the renewed emphasis on duty of care as a travel requirement for clients (global 65 per cent, Asia Pacific 68 per cent). The need for companies to reduce risk is expected as TMCs now facilitate more than air travel, with rail, hotel and car bookings included.

TMC executives also see corporations increasingly requesting sustainability services as a central part of their partner offering. They will rely on TMCs to guide them towards greener travel options and expect them to provide emissions data.

Travel patterns are also changing with increase in bleisure trips, fewer trips, longer stays and with a higher spend per trip. Companies are willing to allow direct flights and premium cabins to ensure safety for their staff.

The small and medium enterprise (SME) market has proved more resilient than larger corporations- a new customer segment for TMCs to focus on.

Travel patterns are changing with increase in bleisure trips, fewer trips, longer stays and with a higher spend per trip.

Key challenges

• Staffing and where to find the right people

• Time spent sourcing and relaying reliable Covid-19 travel information, and managing disruptions, at a time when government rules and regulations are constantly changing.

• Technology costs, and accessing full travel content, including NDC, rail, and low-cost carriers.

Strategising for recovery and growth

Technological advancements, such as automating manual tasks and recruiting new skill sets, is cited by 63 per cent of TMCs globally and 71 per cent of in Asia Pacific as the top strategy for the recovery of business travel.

Cost optimization (global 49 per cent, Asia Pacific 63 per cent) is a key solution that TMCs look to for growth. This could be in automating tasks like routine service desk enquiries or offering more self-service tools to clients so they can focus more on the duty of care for travelers.

Diversification to new revenue sources is also a top priority for 69 per cent of TMCs globally and 59 per cent in Asia Pacific. This could involve attracting new types of customers, selling more content  or creating additional services.

As business travelers are looking for more services and content TMCs can look at different technologies to improve customer service including improving mobile apps and messaging tools, virtual payment offerings and self-booking tools with fuller content.

Mieke De Schepper, Amadeus executive vice president and managing director, Asia Pacific, noted that TMCs in Asia Pacific are very optimistic in the recovery of business travel, which is already happening in China’s domestic market.

“But much has changed and Asia Pacific TMCs see clear opportunities in the new world of business travel to also further improve on the past. A great example is the high number who expect more companies to shift from unmanaged to managed business travel. This provides fantastic potential for TMCs to earn more revenue by helping clients with this transformation,” she added.

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