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American Express Global Business Travel released first quarter figures on business travel pricing from its Business Travel Monitor showing the average prices business travelers are paying are higher. In light of this, companies should consider how they are proactively supporting employees in making the best travel purchasing decisions to help them stay within budget as they continue to hit the road.
Q1 2012 Business Travel Monitor Highlights
Prices across all categories of service for trips originating in North America to domestic and international destinations have increased compared to the first quarter of 2011 as companies continue to invest in travel and suppliers effectively manage capacity.
- Average domestic airfares increased 6% in Q1 2012 vs. Q1 2011 to $261
- Average international airfares increased 4% in Q1 2012 vs. Q1 2011 to $1933
- Average domestic hotel rates increased 5% in Q1 2012 vs. Q1 2011 to $157
- Average international hotel rates increased 1% in Q1 2012 vs. Q1 2011 to $240
“Prices rose in the first quarter as companies put travelers on the road to jumpstart 2012 business goals while supply remained relatively tight,” said Christa Degnan Manning, director, EXPERT INSIGHTS Research, American Express Global Business Travel. “To optimize travel budgets in this environment, companies should look at how they are encouraging compliance with corporate travel policies with positive motivators, instead of punishments for non-compliance. Travelers should be rewarded for booking with preferred suppliers and taking cost-saving measures such as advance purchasing in ways that they appreciate. Strategies like these can demonstrate support to travelers throughout their journeys.”
Informed travelers help combat rising prices
Power to help optimize budgets lays more and more in the hands of the traveler. As suppliers maintain a position of strength, companies should re-examine their travel policies to reflect current market conditions and the needs of their travelers. When travelers feel that they are given support and guidance to make appropriate and educated buying decisions, they likely make smarter decisions with their corporate dollars. Helping travelers make smarter decisions include helping to making sure travelers not only know which providers are preferred, but also understand the benefits of using these suppliers over others. Travelers generally want to do what is best for their companies, but need to be clearly and simply told what that means and how they can help.
Theodore is the Co-Founder and Managing Editor of TravelDailyNews Media Network; his responsibilities include business development and planning for TravelDailyNews long-term opportunities.
