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Business Traveller - UK - August 2014

“Services such as Rocketrip that incentivise employees to hunt for deals and spend under budget are set to accelerate the shift towards self-booking and provide a significant threat to the continued relevance and appeal of travel management companies.”
– Harry Segal, Technology & Travel Analyst

This report answers the following questions:

  • What is the future for business travel management companies?
  • How is customer loyalty evolving in the business travel market?

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Table of contents

  1. Introduction

      • Definition
        • Abbreviations
        • Executive Summary

            • The market
              • Market volume down 7.4% in 2014
                • Figure 1: Total business travel market, by volume, 2009-19
                • Figure 2: Total business travel market, by value, 2009-19
              • Underperforming domestic segment will continue to depress wider market
                • Market factors
                  • GTMC figures show transactions increased 2.7% in 2013
                    • In-flight Wi-Fi in Europe could become mainstream by 2016
                      • European roaming charges could be eliminated by 2015
                        • Ryanair and easyJet make moves to attract business travellers
                          • Lufthansa/Turkish Airlines deal could boost travel to the Far East
                            • Hybrid engines and telematics could defuse high pump prices
                              • Jet fuel price remains high but new plans boost fuel efficiency
                                • Rail fares have increased but investments and Wi-Fi could improve travel
                                  • The consumer
                                    • Penetration of overseas trips has grown, despite a contracting market
                                      • Figure 3: Business trips taken in the last 12 months, April 2013 and May 2014
                                    • Use of flights has increased, while personal car use has fallen
                                      • Figure 4: Modes of travel used, April 2013 and May 2014
                                    • 68% of overnight trips booked less than a month in advance
                                      • Figure 5: Booking lead time, May 2014
                                    • Business travellers are twice as likely to have booked themselves
                                      • Figure 6: Booking method, May 2014
                                    • Over two thirds of self-bookers paid using their own money
                                      • Figure 7: Payment method for personal booking, May 2014
                                    • Online is the dominant channel for self-bookings
                                      • Figure 8: Booking channel for personal booking, May 2014
                                    • The share of travel management companies is low
                                      • Figure 9: Booking channel for company booking, May 2014
                                    • Networking opportunities provide support for the market
                                      • Figure 10: Attitudes towards business travel, May 2014
                                    • Facilitating cashback and loyalty points would boost employee morale
                                      • There is demand for gamification and rewards
                                        • What we think
                                        • Issues and Insights

                                            • What is the future for business travel management companies?
                                              • The facts
                                                • The implications
                                                  • How is customer loyalty evolving in the business travel market?
                                                    • The facts
                                                      • The implications
                                                      • Trend Application

                                                          • Click and Connect
                                                            • Moral Brands
                                                              • Mintel futures: Generation Next
                                                              • Market Drivers

                                                                • Key points
                                                                  • GTMC figures show transactions increased 2.7% in 2013
                                                                    • Figure 11: GTMC business travel transactions, 2008-13
                                                                  • In-flight Wi-Fi in Europe could become mainstream by 2016
                                                                    • European roaming charges could be eliminated by 2015
                                                                      • Ryanair and easyJet make moves to attract business travellers
                                                                        • Lufthansa/Turkish Airlines deal could boost travel to the Far East
                                                                          • Figure 12: Top 20 UK trade partners in 2013
                                                                        • Hybrid engines and telematics could defuse high pump prices
                                                                          • Figure 13: Petrol and diesel pump price, January 2010-June 2014
                                                                        • Jet fuel price remains high but new plans boost fuel efficiency
                                                                          • Figure 14: Jet fuel prices, Pound Sterling per gallon, January 2010-May 2014
                                                                        • Rail fares have increased but investments and Wi-Fi could improve travel
                                                                          • Sterling performs well against key business travel destination currencies
                                                                            • Figure 15: Index of Pound Sterling against key business travel destination currencies, January 2012-June 2014
                                                                        • Who’s Innovating?

                                                                          • Key points
                                                                            • Rocketrip rewards employees for spending under budget
                                                                              • Rocketmiles lets users earn air miles for hotel stays
                                                                                • Odyssey and La Compagnie to launch business-only transatlantic services
                                                                                  • CWT and Amex use gamification to boost loyalty and compliance
                                                                                  • Market Size and Forecast

                                                                                    • Key points
                                                                                      • Market volume contracted an estimated 7.4% in 2014
                                                                                        • Figure 16: Volume and value of business trips taken by UK residents, 2009-14
                                                                                        • Figure 17: Volume of business trips taken by UK residents, domestic vs overseas, 2009-14
                                                                                        • Figure 18: Value of business trips taken by UK residents, domestic vs overseas, 2009-14
                                                                                      • Underperforming domestic segment will continue to depress wider market
                                                                                        • Fan charts
                                                                                          • Figure 19: Total business travel market, by volume, 2009-19
                                                                                          • Figure 20: Total business travel market, by value, 2009-19
                                                                                        • Forecast methodology
                                                                                        • Segment Performance

                                                                                          • Key points
                                                                                            • Long-haul market has suffered a less marked decline
                                                                                              • Figure 21: Volume of overseas business trips taken by UK residents, short-haul vs long-haul, 2008-13
                                                                                            • Overseas business trips by sea increased 8.2% in 2013
                                                                                              • Figure 22: Volume of overseas business trips taken by UK residents, by transport method, 2008-13
                                                                                            • France retains its position as the most popular overseas destination
                                                                                              • Figure 23: Top 10 overseas business travel destinations, by volume of trips taken, 2012 and 2013
                                                                                            • Netherlands and Spain were the worst-performing destinations in 2013
                                                                                              • Figure 24: Best- and worst-performing overseas business travel destinations, by volume change, 2012 and 2013
                                                                                            • London and the South East cement their dominance of the domestic market
                                                                                              • Figure 25: Volume of domestic business trips taken by UK residents, by region visited, 2008-13
                                                                                          • Companies and Products

                                                                                              • Carlson Wagonlit Travel
                                                                                                • Background
                                                                                                  • Financial performance
                                                                                                    • Figure 26: Financial performance of Carlson Wagonlit UK Ltd, 2012 and 2013
                                                                                                  • Recent updates
                                                                                                    • Hogg Robinson Group
                                                                                                      • Background
                                                                                                        • Financial performance
                                                                                                          • Figure 27: Financial performance of Hogg Robinson Group PLC, 2013 and 2014
                                                                                                        • Recent updates
                                                                                                          • American Express Global Business Travel
                                                                                                            • Background
                                                                                                              • Financial performance
                                                                                                                • Figure 28: Financial performance of American Express Company, 2012 and 2013
                                                                                                              • Recent updates
                                                                                                                • Capita Travel and Events
                                                                                                                  • Background
                                                                                                                    • Financial performance
                                                                                                                      • Figure 29: Financial performance of Capita Travel and Events, 2011 and 2012
                                                                                                                    • Recent updates
                                                                                                                      • BCD Travel
                                                                                                                        • Background
                                                                                                                          • Financial performance
                                                                                                                            • Figure 30: Financial performance of BCD Travel UK Limited, 2012 and 2013
                                                                                                                          • Recent updates
                                                                                                                          • The Consumer – Business Trips Taken in the Last 12 Months

                                                                                                                            • Key points
                                                                                                                              • Penetration of overseas trips has grown, despite a contracting market
                                                                                                                                • Figure 31: Business trips taken in the last 12 months, April 2013 and May 2014
                                                                                                                              • Market continues to be dominated by men, under-35s, ABs and Londoners
                                                                                                                              • The Consumer – Modes of Travel Used

                                                                                                                                • Key points
                                                                                                                                  • Use of flights has increased, while personal car use has fallen
                                                                                                                                    • Figure 32: Modes of travel used, April 2013 and May 2014
                                                                                                                                  • Improved fuel efficiency could see a resurgence in travel by car
                                                                                                                                  • The Consumer – Booking Lead Time

                                                                                                                                    • Key points
                                                                                                                                      • 68% of overnight trips booked less than a month in advance
                                                                                                                                        • Figure 33: Booking lead time, May 2014
                                                                                                                                      • One to two weeks is the most popular booking window for air travel
                                                                                                                                      • The Consumer – Booking Method

                                                                                                                                        • Key points
                                                                                                                                          • Business travellers are twice as likely to have booked themselves
                                                                                                                                            • Figure 34: Booking method, May 2014
                                                                                                                                          • Over two thirds of self-bookers paid using their own money
                                                                                                                                            • Figure 35: Payment method for personal booking, May 2014
                                                                                                                                          • Online is the dominant channel for self-bookings
                                                                                                                                            • Figure 36: Booking channel for personal booking, May 2014
                                                                                                                                          • The share of travel management companies is low
                                                                                                                                            • Figure 37: Booking channel for company booking, May 2014
                                                                                                                                        • The Consumer – Attitudes towards Business Travel

                                                                                                                                          • Key points
                                                                                                                                            • Networking opportunities provide support for the market
                                                                                                                                              • Figure 38: Attitudes towards business travel, May 2014
                                                                                                                                            • Facilitating cashback and loyalty points would boost employee morale
                                                                                                                                              • Demand for gamification and rewards
                                                                                                                                                • Travellers prefer to relax in transit
                                                                                                                                                • Appendix – Market Size and Forecast

                                                                                                                                                    • Figure 39: Total business travel market, by volume, 2014-19
                                                                                                                                                    • Figure 40: Total business travel market, by value, 2014-19
                                                                                                                                                • Appendix – The Consumer – Business Trips Taken in the Last 12 Months

                                                                                                                                                    • Figure 41: Business trips taken in the last 12 months, May 2014
                                                                                                                                                    • Figure 42: Business trips taken in the last 12 months, by demographics, May 2014
                                                                                                                                                    • Figure 43: Business trips taken in the last 12 months, by demographics, May 2014 (continued)
                                                                                                                                                    • Figure 44: Business trips taken in the last 12 months, by demographics, May 2014 (continued)
                                                                                                                                                • Appendix – The Consumer – Modes of Travel Used

                                                                                                                                                    • Figure 45: Modes of travel used, May 2014
                                                                                                                                                    • Figure 46: Modes of travel used, by demographics, May 2014
                                                                                                                                                    • Figure 47: Modes of travel used, by demographics, May 2014 (continued)
                                                                                                                                                    • Figure 48: Modes of travel used, by demographics, May 2014 (continued)
                                                                                                                                                    • Figure 49: Modes of travel used, by business trips taken in the last 12 months, May 2014
                                                                                                                                                    • Figure 50: Modes of travel used, by business trips taken in the last 12 months, May 2014 (continued)
                                                                                                                                                    • Figure 51: Modes of travel used, by booking lead time, May 2014
                                                                                                                                                • Appendix – The Consumer – Booking Lead Time

                                                                                                                                                    • Figure 52: Booking lead time, May 2014
                                                                                                                                                    • Figure 53: Booking lead time – Any business trip, by demographics, May 2014
                                                                                                                                                    • Figure 54: Booking lead time – Any business trip, by demographics, May 2014 (continued)
                                                                                                                                                    • Figure 55: Booking lead time – Most recent day trip, by demographics, May 2014
                                                                                                                                                    • Figure 56: Booking lead time – Most recent day trip, by demographics, May 2014 (continued)
                                                                                                                                                    • Figure 57: Booking lead time – Most recent overnight trip, by demographics, May 2014
                                                                                                                                                    • Figure 58: Booking lead time – Most recent overnight trip, by demographics, May 2014 (continued)
                                                                                                                                                • Appendix – The Consumer – Booking Method

                                                                                                                                                    • Figure 59: Booking method, May 2014
                                                                                                                                                    • Figure 60: Booking method, by demographics, May 2014
                                                                                                                                                    • Figure 61: Payment method for personal booking, May 2014
                                                                                                                                                    • Figure 62: Payment method for personal booking, by demographics, May 2014
                                                                                                                                                    • Figure 63: Booking channel for personal booking, May 2014
                                                                                                                                                    • Figure 64: Booking channel for personal booking, by demographics, May 2014
                                                                                                                                                    • Figure 65: Booking channel for company booking, May 2014
                                                                                                                                                • Appendix – The Consumer – Attitudes towards Business Travel

                                                                                                                                                    • Figure 66: Attitudes towards business travel, May 2014
                                                                                                                                                    • Figure 67: Attitudes towards business travel, by demographics, May 2014
                                                                                                                                                    • Figure 68: Attitudes towards business travel, by demographics, May 2014 (continued)
                                                                                                                                                    • Figure 69: Attitudes towards business travel, by business trips taken in the last 12 months, May 2014
                                                                                                                                                    • Figure 70: Attitudes towards business travel, by business trips taken in the last 12 months, May 2014 (continued)
                                                                                                                                                    • Figure 71: Attitudes towards business travel, by modes of travel used, May 2014
                                                                                                                                                    • Figure 72: Attitudes towards business travel, by modes of travel used, May 2014 (continued)
                                                                                                                                                    • Figure 73: Attitudes towards business travel, by booking method, May 2014

                                                                                                                                                Companies Covered

                                                                                                                                                • Amazon.com Inc
                                                                                                                                                • American Express Company (The)
                                                                                                                                                • Apple, Inc
                                                                                                                                                • Bank of Montreal
                                                                                                                                                • Barclays Bank plc
                                                                                                                                                • BCD Travel
                                                                                                                                                • BUPA
                                                                                                                                                • Capita Business Travel
                                                                                                                                                • Carlson Wagonlit Travel, Inc.
                                                                                                                                                • Expotel
                                                                                                                                                • First Great Western
                                                                                                                                                • Global Travel Group Plc
                                                                                                                                                • Google, Inc.
                                                                                                                                                • Hogg Robinson plc
                                                                                                                                                • HRG
                                                                                                                                                • InterContinental Hotels Group PLC
                                                                                                                                                • JPMorgan Chase & Co
                                                                                                                                                • Kingfisher Airlines
                                                                                                                                                • London Stock Exchange plc
                                                                                                                                                • Lonsdale
                                                                                                                                                • Macquarie Group
                                                                                                                                                • MasterCard UK
                                                                                                                                                • Microsoft Corporation
                                                                                                                                                • Radisson Hotels & Resorts
                                                                                                                                                • Reuters Group PLC
                                                                                                                                                • Siemens plc
                                                                                                                                                • Sony (UK) Ltd
                                                                                                                                                • Standard Life Assurance Company
                                                                                                                                                • Thomson Holidays
                                                                                                                                                • Travelocity.com L.P.
                                                                                                                                                • Travelport
                                                                                                                                                • Virgin Travel Group

                                                                                                                                                Business Traveller - UK - August 2014

                                                                                                                                                £1,995.00 (Excl.Tax)