Healthy Business Travel Climate = Time to Focus on Your Hotel Program

By Suzanne Neufang

Some positive industry metrics have come to light in recent weeks. According to the International Air Transport Association, worldwide air travel demand increased by 9.5 percent year-over-year in March, the fastest monthly pace in the past year. Amadeus reported that first-quarter bookings through the world’s largest Global Distribution System (GDS) rose 3.4 percent in the first quarter, sparked by “better than expected” airline booking growth. Sabre, the dominant GDS in North America, saw its bookings surge by 6 percent. Sabre’s CEO said “Corporate travel continues to improve.”

All of these business travelers need a place to sleep at night! Accordingly, we’re seeing the largest global hotel chains report growth metrics. Marriott’s first quarter net income rose seven percent year over year, with the world’s largest chain adding more than 14,000 rooms to its inventory, including 5,800 outside of the U.S. IHG saw a 4.3 percent increase in revenue-per-available-room, and they added 8,000 rooms to their portfolio in anticipation of more volume.

So what does this mean for procurement leaders keeping their eye on optimizing lodging expenses?

If you managed to source a fair, flat rate with your preferred hotel partner(s) that will run through the entire calendar year or into 2019….good for you. The foresight to lock in rates should serve your program well at a time when demand appears to be on the rise.

If you lean on dynamic pricing or operate your program with percentage discounts based on “best available” rate….now is the best time to get the magnifying glass out and see what options you have. With air travel increasing, positive economic growth in most countries, and consolidation still taking place, hoteliers are likely to take steps to increase their yield and are apt to boost rates in cities with high demand.

Corporate hotel programs can counter these moves by being smart with the volume they offer to hotel suppliers. Keep an eye on the room nights your travelers book at both preferred and non-preferred hotels….these metrics may open avenues to savings if you can steer more travelers to specific brands / properties. You may also find savings by revisiting ancillary items in hotel contracts like breakfast and WiFi, two oft-overlooked items that can drive unnecessary incremental spending.

Finally, if you are among the many hotel programs that are not yet familiar with Continuous Sourcing (42 percent, according to the ACTE Hotel Sourcing White Paper released last month), now is the time to get acquainted with this money-saving option. Early adopters of Continuous Sourcing recorded both savings and increased traveler satisfaction (see below chart). Continuous Sourcing also gives you flexibility for environments just like this one, when you truly need to manage your volume and work closely with your most preferred supplier partners.

                                          Continuous Sourcing Benefits      










ACTE Sourcing White Paper – April 2018

HRS is a leader in leveraging Continuous Sourcing for programs at the forefront of this new approach. Through our development of expedited sourcing techniques, we are redefining hotel procurement and accelerating processes that save companies both time and money. HRS is educating clients about Continuous Sourcing strategies, and putting them to work in cities in the Americas, Europe and Asia-Pacific. Reach out to your regional HRS contact to learn more about how HRS’ broad portfolio of services – including Continuous Sourcing – can help you optimize your program at a time when rates and fees are on the rise.



Reduced Meetings Commissions? Use the Moment to Shine a Light on Your Program

by Abbie Michaelson, VP Meetings & Groups, HRS

30 January 2018

January’s news that Marriott is reducing group and meetings commissions in North America will surely have ripple effects on buyers, suppliers and third parties that support corporate events. That (somewhat obvious) point aside, the moment does offer a “triggering event” for all parties in the meetings arena to take a closer look at the processes they use today. This especially rings true for companies that manage dozens to hundreds of simple meetings, the smaller gatherings that tend to make up the majority of a company’s meeting expenditures.

In reaction to this commission cut…and the likelihood that cuts from other large chains are probably forthcoming… meeting planners and the administrative assistants should consider the following steps:

  • Make sure your cumulative spend reporting is top notch. While blanket statements on commission levels can be made, a motivated hotel salesperson sitting across from a meeting planner with irrefutable spend figures can often deliver something better than the chalk deal. Know the true value of ALL your spend…not just room nights, but F&B, meeting rooms, A/V, etc.
  • Examine your mix of meeting venues. Does your list of preferred providers give you suitable alternatives for the variety of meetings your company holds in your key city centers? This news justifies a thorough look at the options you work with today, factoring in the “negotiability” of each.
  • Stay engaged on industry changes and local property trends. As commission levels fluctuate, big chains consolidate, regional group and independent properties invest in meeting services and cancellation fees get more restrictive…how are you staying on top of the dynamic changes taking place? Are you getting a strategic view as well as necessary local insight? Planners should know the value of their OWN time, and truly consider the merits of outsourcing some or all elements of meetings management in an effort to be more strategic in their everyday activities… and deliver optimal value for the totality of meetings spend across the enterprise. HRS’ meetago service, targeted at simple meeting management, significantly reduces the time planners need to spend on RFPs, hotel negotiations, and reporting.

The altering of an economic equation is not necessarily a bad thing. Meeting planners should take this opportunity to give their programs a fresh look, and perhaps make changes that not only mitigate the negative metrics, but open some doors that can lead to better performance.



A Time to Shine – HRS Clients Earn Significant Travel Industry Awards

by Suzanne Neufang

October 30, 2017

Modern travel management offers travel managers and procurement executives a broad array of avenues to success. As most corporate program leaders know, there are a variety of factors – some controllable, others not – that go into achieving sustainable success. The finest travel managers learn to manage that balance, impacting what they can, translating strategy into action, and driving measurable accomplishments on a recurring basis.

Over the course of the past four months, three HRS clients earned prominent awards for delivering such results for their companies. The spirit of innovation, creativity and traveler centricity runs through each of these programs. These award winners look at travel management challenges through the prism of possibility and good leadership. We at HRS are pleased to be a part of their equation as they strive to better serve both travelers and their company’s financial goals in the effort to optimize corporate travel programs.

Steven Schoen, Siemens – Named Travel Manager of the Year by Business Travel News

Schoen, working with Siemens’ travel team, helped author a revised global travel program, leaning on four strategic enablers – Driving an Ownership Culture, Digitization, Transparency and Simplification.

Siemens’ Steven Schoen accepts BTN’s prestigious Travel Manager of the Year award in Boston during the July 2017 GBTA Conference.










Darragh Ormsby, Google – Recipient of the Association of Corporate Travel Executive’s first Travel CEO Award

Ormsby plays a significant role in Google’s widely-followed travel program, facilitating superior performance in a sprawling program by giving travelers immense flexibility and demonstrating leadership in engagement with suppliers and Google’s C-suite. The program also enables the “giving back” of trip savings to charitable organizations around the world.

Google’s Darragh Ormsby accepts the ACTE Travel CEO Award from ACTE Executive Director Greeley Koch and ACTE President Kurt Knackstedt in London October 2017.







HRS managing director UK Douglas Green (left) and VP Americas Suzanne Neufang with Google’s Darragh Ormsby at the HRS booth at ACTE London in October 2017










Ben Park, Parexel – Named Best Practitioner by Business Travel News

BTN recognized Park for his overhaul of Parexel’s small meetings program, helped in part by HRS’ meetago application. Park implemented an end-to-end concept that works for both Parexel’s preferred hotel suppliers and the admins/event planners that organize the company’s small meetings.

Parexel’s Ben Park accepts a Best Practitioner award from BTN’s David Meyer at GBTA Boston in July 2017












We are thrilled to see our clients get this well-deserved recognition. As our client base grows and more companies register success, we look forward to contributing even more stories like these … so their peers can learn which strategies and tactics can apply to their own programs. In the managed travel ecosystem, peers are usually the most trusted source of new ideas; we congratulate these three programs for their vision and leadership.

Pack Some Patience & Get Prepped for the Interview

New Security Guidelines for Inbound US Travelers Start in Late October

by Suzanne Neufang

On Thursday October 26 air carriers will adopt enhanced screening procedures for flights going to the United States. They are doing so to comply with guidelines issued by the U.S. Transportation Security Administration in June.

Business travelers have proven to be an accommodating lot when it comes adjusting to new security realities. At the end of the day, they really don’t have many options but to prepare smarter and budget more time to get from curbside to the gate.

While the biggest issue is the carry on (or not?) of laptops (be sure to check with your carrier), we’re going to take a moment to consider the (potentially) more interesting part of these new processes…the interview.

When business travelers hear the word “interview,” they typically have a new job or promotion at stake. There’s a whole cottage industry out there, helping corporate climbers of every stripe master the interview. Highlighting strengths, minimizing weaknesses, showcasing collaborative and leadership skills, etc. The goal is always relatively the same: to humbly impress the interviewer.

Travel security interviews? This could be a whole new ballgame, with travelers having to gauge their interviewer quickly and answer questions adroitly. Best to leave your sense of humor in your pocket, be concise and accurate in your answers, and make your way to your increasingly smaller airline seat for the long ride.

That said, the human element promises to bring forth some interesting tales of engagement. People like to tell stories; it will be interesting to see the similarities and differences that airlines come up with as they interview US-bound passengers. Strategies will get developed, and airlines will struggle with the challenge of efficient passenger flow versus security requirements that doubtlessly will leave some travelers feeling inconvenienced.

We encourage all business travelers with a well-worn cliche: pack some patience as the “process” navigates yet another milepost.

Corporate Hotel Programs Need to Stay on Top of New Chain Cancellation Fees to Mitigate Financial Impact

by Suzanne Neufang

August 21, 2017 – The recent announcements by major hotel chains on the expansion of advance cancellation penalties drove a degree of media coverage, but a lack of understanding of the potential cost implications for corporate hotel programs. Off-the-cuff assumptions rarely satisfy CFO queries; travel managers need to have answers ready for their bosses as questions on the impact of these changes are likely as 2018 budgets come into focus.

HRS certainly understands that hotels have every right to maximize their room inventory and generate revenue. That said, optimized supplier-buyer relationships are a priority for hotel chains big and small. Armed with metrics from verifiable travel data, HRS believes travel programs can leverage their relationships and proven performance to mitigate these new fees and help keep the historical free-of-charge cancellation up to 6 pm on the day of arrival in place.

A new study from HRS, together with fresh survey results, provides the first true glimpse at the potential fiscal ramifications of these new policies for multi-national corporate hotel programs. An in-depth analysis of the booking data of our largest corporate customers over the past twelve months – cancellations in particular – leaves no doubt that these new fees could drive millions in new travel-related expenditures. Some takeaways from the study:

  • 17 percent of business trips are cancelled
  • Five percent of those cancellations are within 48 hours of arrival

To provide a concrete example, HRS took a detailed look at metrics potentially impacting a multi-national client that spends $82 million globally on lodging:

  • If all cancellations made by this company in North America within 48 hours of arrival were subject to this charge, the budget impact would be $600,000 USD a year.
  • If all chain hotels globally implement this policy, this same company could see additional costs of up to $2.7 million USD, corresponding to three percent of total booking volume.

As these results show, there is real money at stake. While most of the changes so far impact only North American properties for a few global chains, corporations need to be vigilant on this issue as the traditional RFP season begins in earnest in September. Hoteliers often mimic other industries…once a new revenue stream proves to be sustainable, it’s a good bet that many others will follow suit. And once they see notable revenue from the new policy, it’s certainly conceivable that such policies could extend to properties on other continents.

Travel buyers that outsource to HRS can be assured that this issue will be properly addressed in hotel negotiations – not only to mitigate recent policy expansions, but to wrap in a degree of protection from future fees that some chains are modeling.

The survey of 100 travel managers reveals that most travel buyers value cancellation policy flexibility; we’re confident that hoteliers will respect that never-ending request when it is married with the bulletproof data of “past room nights” that showcase the steady volume of a preferred customer. We encourage travel managers to get their best data, re-state the importance of business traveler flexibility, and work with their preferred hotel supplier partners to prolong historical policies that best serve today’s business traveler.

Become a Data Diva: It Makes all the Difference in Hotel Sourcing Season

by Suzanne Neufang

August 8 – HRS has long advocated that corporate travel managers have irrefutable data before they sit down and cut deals with hotels, whether it’s for a system-wide program or just specific properties in a single destination. As the 2018 RFP season gets underway…and we see mixed economic signals impacting global economies and hotel suppliers…that guidance looks to be spot on.

Here’s the good news; the U.S. economy features a robust stock market (surpassing 22,000 for the first time last week), consistently high monthly new job figures, and an environment where the hospitality segment is hiring more than many other sectors. IATA reported that global air travel grew by 7.9 percent over the first six months of the year: it’s easy to conclude that many of those travelers slept in a hotel during their journey. On the hotel chain front:

But here’s the bad news: TravelClick’s latest report noted that U.S. hotel bookings in the business transient segment are down 3.8 percent for the third quarter, and group occupancy is down more than five percent from last year. Analyst John Hach said that their data “predicts a prolonged decline” in most North American markets. GBTA notes that global business growth is projected to top five percent both this year and next….but all projections come with a caveat tied to the unpredictable political scene in nearly every region on the planet (see GBTA graphic below).

So…what can a travel manager do as they try to shape a relevant lodging forecast for the next six months to a year?

Like many things, the answer lies in staying focused and leveraging irrefutable benchmark and program data, coupled with keen insight on the company’s business goals. Showcase the value which a managed hotel program brings: the ability to drive spend and traffic to preferred properties, and leverage other discounted rates when it makes sense. Take the right steps, and workable metrics can be in reach.

Increase your odds for better outcomes – both in the short term and long term – by working with experts on rate trends, projections, and execution. Don’t underestimate the value of on-the-ground expertise as you consider new markets for your travelers.

Sure, reports and projections drive a lot of headlines. Successful benchmarking, sourcing and ultimate execution, however, is the final proof for lodging program success which every CFO appreciates.

Joint GBTA/HRS Survey Details Frequency of Corporate Hotel Rate Auditing

By Suzanne Neufang

Those of us who have worked in the arena of corporate hotel programs for any length of time in recent history have all participated in debates about the accuracy of hotel rates. Far too often, those conversations revolve around erroneous rates and the scenarios pertaining to why the rates negotiated during RFP season don’t always – or even often! – appear when employees shop for hotels.

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HRS Kicks Off Collaborative Global Series for Corporate Travel Buyers

by Suzanne Neufang

Travel managers and corporate procurement executives are often challenged when it comes to carving time to check the pulse of the industry. In North America, we’re lucky enough to have a number of events (GBTA, ACTE, local BTAs, regional BTN events) that offer educational opportunities to consider fresh trends and hear from our peers on interesting panels. Many global corporate travel observers look at the list of events in North America with a jealous eye, wishing there were more scenarios for travel management professionals on other continents to further their knowledge of best practices and take new tactics back to the home office.

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