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2016, a challenging year for business travel buyers

The pressure on buying more for less seems to have lessened for 2016. 44 per cent of buyers will arrange more trips this year, a drop of 6 per cent on 2015, and 19 per cent will arrange fewer trips compared to 14 per cent last year.

The results of the sixth annual Business Travel Show forecast suggest 2016 could be a challenging year for buyers with budgets increasing at a slower rate, half of buyers worrying about rising travel costs and compliance, new distribution methods and traveller wellbeing causing concern.

It’s not doom and gloom for everyone, however, as almost one third (29 per cent) of buyers will have more money to spend in 2016, this compares to 32 per cent in 2015. At the same time, a quarter expect budgets to drop, a 5 per cent increase on 2015.

The pressure on buying more for less seems to have lessened for 2016. 44 per cent of buyers will arrange more trips this year, a drop of 6 per cent on 2015, and 19 per cent will arrange fewer trips compared to 14 per cent last year.

Airline spend
76 per cent of buyers will have the same or more to spend on airline travel in 2016. For one third, budgets will increase, the same as in 2015. One quarter (24 per cent) expect budgets to shrink. Last year, just one fifth had less to spend.

  • The use of low cost carries remains unchanged at 86 per cent.
  • In 2015, 26% booked more low cost flights, this year it rises to 27 per cent.
  • The number of buyers booking fewer business class flights increased again, from 38 per cent in 2015 to 42 per cent this year.
  • The number of buyers operating no time threshold for business flights dropped slightly from 33 per cent to 28 per cent.

Accomodation spend
One third of buyers will have more to spend on accommodation in 2016, the same as last year. The use of budget hotels dropped slightly. They now account for fewer than 25 per cent of bookings for three quarters (78 per cent) of buyers; down from 70 per cent in 2015.   

Top issues facing buyers
More than half of buyers (51 per cent) worry that travel costs will rise this year, which explains why cutting costs is their number one concern (moving up five spots since last year’s top 20). The following were given in response to an open question: What will be the biggest issue facing you as a buyer in 2016?

 

2015/2016

2014/2015

2013/2014

  1.  

Cutting costs while maintaining quality

Airline pricing – increases, lack of transparency and negotiation concerns

NDC

  1.  

Increasing compliance

Controlling costs and managing spend

Travel management 2.0

  1.  

GDS content

Compliance and enforcing policy adherence

Data

  1.  

Risk management vs costs savings

Increased hotel rates

Sustainability

  1.  

Increasing hotel rates

Traveller safety

Meetings management

  1.  

Airline pricing

Cost savings

Mobile apps

  1.  

Supplier negotiations

Ancillary fees

Technological developments

  1.  

Securing value for money

The role of the TMC

Free Wi-Fi in hotels and on airlines

  1.  

Online adoption/booking

Online adoption

CSR

  1.  

Mobile apps

Cost increases

Terrorism

  1.  

Data and how to use it

Balancing traveller needs while staying within budget

Gamification

  1.  

Russia

Online vs TMC pricing

Relaxation of policy

  1.  

Changing traveller profiles

Sustainability

Airline bankruptcy

  1.  

Global purchasing responsibility

GDS content

Integration of social and travel tools

  1.  

Cost increases

Supplier consolidation

Ancillary fees

  1.  

Supplier consolidation

Mobile technology & solutions

Airline consolidation

  1.  

NDC

Airline consolidation

Risk management

  1.  

Discovering new destinations

Availability and variety of low cost leisure tools

Virtual meetings

  1.  

Last minute bookings

The move towards traveller management

Fuel increases

  1.  

Stakeholder management

Stakeholder management

Less reliance on TMCs

Buyers were also asked how they plan to change the way they manage travel this year:

1

Increasing use of online booking

53%

2

Increasing compliance

31%

3

Changing relationship with TMC

22%

4

Improved focus on traveller wellbeing and communication

9%

5

Use of data

9%

The Business Travel Show takes place at Olympia Grand in London on 24-25 February 2016. It is Europe’s leading event for corporate travel buyers.

Co-Founder & Chief Editor - TravelDailyNews Media Network | Website | + Posts

Vicky is the co-founder of TravelDailyNews Media Network where she is the Editor-in Chief. She is also responsible for the daily operation and the financial policy. She holds a Bachelor's degree in Tourism Business Administration from the Technical University of Athens and a Master in Business Administration (MBA) from the University of Wales.

She has many years of both academic and industrial experience within the travel industry. She has written/edited numerous articles in various tourism magazines.

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