Embracing Technology

The traditional travel management company model has had to evolve, largely due to the technological advancement that has changed our lives and changed the way people book and engage in travel.


It’s a different world out there.

The times are changing and they are changing quickly. Technology dominates our lives and it’s technology that is ever evolving, with increased information at our fingertips and trends changing all the time. Throw in some economic uncertainty and increased competition, and you have a challenging environment in which to operate.

That applies to just about every industry, but what does it mean for the travel industry, and specifically those in travel management?

Well, quite simply, the role of a travel manager has become increasingly complex. The influx of online travel agencies and platforms has meant that more and more consumers are opting to be their own travel manager.

The demands of the corporate traveller are becoming more challenging too. Budgets have contracted, yet the travel needs of businesses have largely remained the same. In fact, many travel managers believe the cost of travel is actually increasing.

So, where does that leave the travel management company?

“Defining our value as travel professionals is perhaps the biggest challenge facing TMCs today,” says Euan McNeil, General Manager of FCM Travel Solutions, part of the Flight Centre group in South Africa. “Corporate travel agents were in the past transactional and earned their revenue based on the transactions they performed on behalf of the client – booking a flight or hotel, changing the date of a ticket etc. With the advent of travel technology, customers have become empowered (although not necessary inclined) to conclude some of these transactions themselves. The result is that the transactional part of the job of travel agent has been eroded, and the requirement by customers is thus a more consultative approach. Herein lies the challenge, as TMCs work to define and communicate effectively the consultative value they bring to the end customer and determine what to charge for that value.”

McNeil touches on the essence of the thread that will be explored throughout this piece, as there is no doubt that technological advancement has had the greatest impact on the role that TMCs now play, as it relates to their clients.

“Every TMC is currently under pressure to showcase their value to clients due to enhanced technology available in the market,” says Yasmeen Khan, Head: Business Development, Corporate at Wings Travel. “This requires a consistent approach in terms of managing the clients’ travel spend and demonstrating in various ways the true value of our partnership.”

“Our challenges are the same as most TMCs,” says Bronwyn Humphries, Marketing Co- Ordinator, Harvey World Travel Franchise Support Team. “This would be new competitors in the market as well as online travel agents. There’s also a definite shift to online tools for corporate clients, with corporates more likely to book their own ‘bleisure’ trips, for example, along with cutting their costs.”


“Corporate travel is finally starting to learn lessons from the consumer travel space, mostly because business travellers have been trained by their leisure travel to expect robust booking tools and more control over their trips,” says Andrew Sheivachman, Senior Writer at Skift, an intelligence platform providing media, insights and marketing to key sectors of travel. “The travel management companies that focus the most on improving their traveller-facing technology will win this battle, and improve their clients’ travel experience in the process.”

So, what are TMCs doing to stay ahead of the game and remain relevant? Specifically, what technology and services are they developing to remain of value to their clients? One way is to go the ‘whole hog’ and develop your own tech.

“At Tourvest Travel Services we have developed our own online travel management solution called Travelit, which was developed not just with the customer in mind, but also the travel consultant,” says Claude Vankeirsbilck, Chief Sales & Marketing Officer. “This means our travel consultants work on the same technology platform as our clients, offering full transparency and a more efficient service delivery process. There are weekly product enhancements and developments driven by our own developmental team. This allows TTS to be more competitive, more efficient in service delivery, and ultimately offer more value to our customers, as our technology solution adds value to the customer’s bottom line.”

That’s the key, isn’t it? Adding value by recognising the complementary relationship between the TMC and the technology. It seems almost obvious to say that those TMCs who view technology as a threat are dead in the water. It’s all about embracing the tech out there, identifying which tech complements the TMC’s existing offering, and then rolling it out in a way that provides the customer with that value and ultimately strengthens the supplier-customer relationship.

“One of the biggest challenges is the accessibility that a traveller now has to a range of pricing across various consolidator websites etc,” says Khan. “In order to be ahead of the game, Wings Travel Management has developed its own proprietary technology in order to integrate such developments outside of our normal reservations system, thereby enhancing content and ensuring that we offer the best price to our customers.”

The Wings model is slightly different from other TMC models in that the group favours wholly-owned global offices over franchise agreements, but the benefits of that model extend into the tech space.

“Our Wings globally-owned offices allow us to truly standardise our sales platforms across the globe by giving our clients consistent and reliable data, and offering them access to all our proprietary products,” says Khan. “Wings boasts a reporting tool which is accessible via URL and includes live data with many enhanced features, offering clients a snapshot view of their travel spend, travel patterns and detailed insights into traveller behaviour, allowing a proactive approach in terms of managing their spend.”

Another area where Wings has focused its technological efforts is the increasingly important duty of care space. It recently launched goSecure, a risk management solution for their clientele that allows them to track and communicate directly with their travellers via a mobile application, coupled with the Wings24 emergency contact centre, which manages risk and traveller safety on behalf of Wings’ clients.

For McNeil, the technology has to be complementary, and he believes a lot more thought needs to be given to this area before a TMC rolls out the latest tech. Specifically, he believes there almost needs to be a ‘division of labour’ between what the technology can offer and what the TMC and its staff are best equipped to focus on.

“To remain relevant and viable, it is essential that we use technology to drive automation and improve service for our mutual benefit,” he says. “Non-complex bookings should be automated, freeing up skilled travel professionals to focus on areas in which they can truly add value beyond the transaction, for example in the areas of data analysis, duty of care and supplier negotiations.”

To this end, FCM has developed a chatbot in the United States. It’s called ‘Sam’ and promises the expertise of a skilled FCM consultant available at all times: pre, during, and post-trip. Sam is a travel-savvy chatbot that can assist with all aspects of travel – itineraries, gate changes, driving directions, weather, restaurant recommendations and reservations. There’s also ‘call or SMS my consultant’ functionality, which gives travellers access to a live FCM consultant 24 hours a day for live assistance on the go.

“Every travel programme should have technology that clearly focuses on improving the traveller, travel booker and travel manager’s experience,” says McNeil. “That’s whether it be by improving the booking experience through mobile apps, improving security through better duty of care tools, or maximising spend visibility through enhanced data analytics. As we look to the future, the discussion around artificial intelligence (chat bots, virtual assistants, etc.) is beginning to become common-place internationally – once again to fulfil a certain type of transaction through technology. This in turn helps to improve the level of efficiency for our clients, but also help to enhance the TMC’s ability to leverage their expertise and personalise the customer’s experience through technology.”

While it’s interesting that FCM has delved into the chatbot space with Sam, Humphries of Harvey World Travel makes a telling observation regarding the uptake of technology, as it relates to this group’s clients.

“We offer our own in-house corporate booking tool for clients who require this,” she says. “However, interestingly, in recent months we have seen a shift in business from online travel agents back to the traditional Harvey World Travel Stores.”

So, whilst technology obviously has a huge role to play in travel management going forward, there are going to be instances where travel managers and/or travellers will defer to the consultant for that human touch. How the two elements co-exist is explored further in the chatbot sidebar.


Of course, the threat of, or greater influence of, technology is not the only challenge facing travel management companies.

Spend is down in the corporate space and TMCs are having to fight hard to justify their fees. Again, as is the case with technology, these TMCs are under pressure to ‘show value’ and prove their worth.

“We do find an extraordinary amount of focus on a cost that equates to less than 8% of the overall total costs of a corporate travel programme,” says Vankeirsbilck. “Our focus as TTS is to find value opportunity where we actively encourage clients to focus their attention on the overall cost of their travel programme, rather than just the service fees, by focusing on travel policy adherence, traveller behaviour, travel supplier consolidation, and technology solutions, which will achieve far greater savings on their total cost of travel rather than saving a relatively small amount on service fees. It is imperative for a TMC to add value to a client’s total cost of travel programme, and this is where the true value is derived.”

McNeil agrees that the discussion needs to move away from the transaction fee.

“In the current economic environment, procurement departments are under pressure to drive cost savings, and one of the easiest targets within the travel procurement space is the transaction fee,” he says. “While TMCs could add great value in helping procurement departments derive savings within their travel programme by proactively managing their travel spend, the knee-jerk requirement to cut costs sees corporates appointing TMCs based on the cost of the transaction fee and the result then is a zero-sum game where TMCs are introducing unsustainable pricing levels just to stay in the game. Standard annual increases are becoming harder to pass in an environment where customer expectations from their TMCs are increasing: better service, more expertise and technology. We are increasingly seeing customers wanting commission and override payments without any expectation that their TMC’s service fees would have to increase commensurately.”

Ole Mortensen is a partner in AMM Consulting in Denmark, and he believes that fee structures need to change, if TMCs “want to regain some of the power they’ve lost.”

According to Mortensen, that ‘power’ has decreased substantially because:

– The internet suddenly made the opaque airfare structure transparent

– Customers insisted on working with transparency, showing and selling net fares

– Online booking engines enabled the traveller control over their booking

– Metasearch engines increased transparency

– Low-cost carriers launched new business models

“It has become clear that the business model needs to change to benefit not only the TMC but also the airlines, other vendors and the travel managers,” says Mortensen.

“I still strongly believe in making a retail multi-source structure where customers are forced to compare total price, as it will benefit the travel managers and suppliers in the long run. Travel managers will have a harder time considering and identifying the right supplier and evaluating their offerings and differential advantages. However, competition will force TMCs to develop more products and services.”

In closing, what Mortensen suggests is the following, in terms of “future pricing models”:

– Subscriptions based on the hours a travel manager/company may need for a TMC

– Consulting, including management information and other soft services, at hourly pricing

– If the TMC offers duty of care, a subscription based on number of travellers

– Vendor negotiation per hour

– Concierge arranging VIP and group travel charges reasonable fee structure ensuring profit for the vendor

“Many other services have a similar structure and while it will move focus away from bookings, it will start a much-needed change for the industry,” he says.

Food for thought.


All of this adds up to a challenging environment for TMCs and a difficult one in which to prosper.

As always, those that survive and indeed are successful, are going to be those that embrace the change that technology offers, use it to their advantage, and integrate it in such a way as to remain relevant and of value to their customers.

That will be key to the TMC success of the future.


Almost 60% of corporates say TMCs are ‘good to great’ at helping them manage compliance within their travel policy, according to a recent study conducted by FCM Travel Solutions and the African Business Travel Association (ABTA) among travel buyers in South Africa.

Over 80% of South African corporates polled in the study indicated that their employees rarely or only occasionally booked out of policy and that in most cases, this non-compliance was from senior management.

Achieving compliance at a time when corporate travel is becoming increasingly consumerised requires a more flexible approach, according to ABTA founder Monique Swart.

“Business travellers are demanding personalisation and relying on the same tools they use and travel experiences they have in their personal lives,” she says. “The indication, thus, that over 70% of surveyed corporates’ policies are strict or rigid should raise concerns.”

“The survey also indicated that only 30% of corporates actually consider and cater to the needs of their business travellers regularly and more than half were not concerned about the negative impacts of business travel on their travelling staff and trying to mitigate these. Traveller friction has an impact not only on the staff member, but also their ability to perform to achieve company goals.”

Among those most-cited areas of anxiety for South African business travellers were flight delays, missed flights and perceived poor service from airlines and hotels. Corporates that are aware of the impact of traveller friction say they are looking at ways in which to mitigate the effects, including limiting travel where possible and introducing traveller-centric policies, including ‘bleisure’ and wellness programmes.

The study further showed that among those most desired ancillaries by business travellers in South Africa are seat selection, access to airport lounges and good service, with on-board entertainment and on-board wi-fi being the least-demanded ancillaries.

From a sharing economy perspective, almost 90% of business travellers are using Uber and Airbnb for business travel purposes, according to the study. As many as 40% are doing so without the permission or endorsement of their companies.

Technology in the corporate travel space is clearly important to South African companies.

“The survey found that over 65% of corporates like to use all the technology that is relevant to them,” says Swart. “There is a cost associated with this, however, and with cost savings being one of the key objectives of a company’s travel programme, technology should be used to help with cost cutting efforts.”


FCM has its own travel bot called Sam, an “itinerary management tool on steroids”, according to Euan McNeil, FCM GM for South Africa. Sam has been released in the USA and is expected to be launched early in 2018 in South Africa.

McNeil believes Sam will be how most business travellers interact with their travel programme in the future and explains that corporate travellers can book a car and hotel themselves and complete the booking without having to work with a consultant.

Travel policy will also not be a problem for Sam.

“We will have a generic policy based on best practice in the market,” says McNeil. “Then, if customers want to take their full travel policy and load that into Sam, there will be a level of commercial uplift.”

Ben Lamm, CEO of Conversable, agrees that if successfully integrated with a company’s travel policy, bots will be able to match the user’s preferences and information with the businesses’ requirements around travel.

“To keep track of all travel, most policies require that travel is booked through a specific company or channel,” he says. “Because bots serve as a single access point for multiple sources of information, travellers will be able to access more options from more places, giving them more flexibility within the framework of the travel policy.”

So, is there a ‘shared’ future for TMCs and travel bots?

“Travel bots, such as Sam, have been developed to provide an additional interface for travellers, which will complement but never replace the skills and insights of the TMC,” says McNeil. “The travel expert will always have a key role to play when it comes to managing business travel for large corporations as well as SMEs.”

According to Norm Rose, President of Travel Tech Consulting, travel chatbots could also be deployed to handle redundant questions such as policy questions, baggage fees, customer support, and limited booking capabilities.

“Progressive TMCs could use chatbots to reduce call volumes by answering simple questions about policy or travel options,” he says.

With smartphone adoption nearing 100% and considering that an average business traveller checks their smartphone 34 times a day, it’s not difficult to understand the popularity and attraction a mobile or virtual assistant holds.

The nearly ubiquitous adoption of smartphones by the modern business traveller, says Lamm, means that a digital solution to travel needs is now a business imperative for the corporate travel industry.

The travel bot is the perfect technological answer to address the business traveller’s need and desire to manage their trip on their own, and give them much-needed freedom within framework. TMCs can make use of bots to improve their service to travellers in a format the travellers desire in a cost-effective way.

“If corporations are going to succeed in winning over the largest generation in the world today and improve retention rates within a group that is notorious for changing paths quickly, building in freedom within framework will certainly be a company imperative,” says Lamm.