WASHINGTON -- Does travel management have any effect on the businesses that use a TMC?
New research from ASTA indicates it does, CEO Zane Kerby said -- to the tune of 20 cents of additional revenue for each $1 spent on managed travel.
Kerby shared those findings during ASTA's Travel Industry Forecast at the National Press Club here on Monday. The Society has been putting an increased focus on corporate travel since earlier this year, when it launched ASTA Corporate in addition to continuing to support its Corporate Advisory Council. ASTA will hold its inaugural Corporate Travel Executive Forum later this week.
The 20-cent figure was determined by global market research and insight firm Rockport Analytics after studying thousands of travel transactions.
"Managed travel is clearly supportive of top-line revenue growth," Kerby said.
During a panel, ASTA board chair Lee Thomas, co-founder of NousTravel in Austin, Texas, said he prefers to think about that metric as a 20% return on investment.
That is often a discussion with prospective clients whose travel is unmanaged, said Jay Ellenby, president of Safe Harbors Travel Group in Bel Air, Md. Safe Harbors has a spreadsheet that it uses to determine exactly what returns a company could get if they moved to a managed travel program.
"It is absolutely stunning," he said.
He provided a simple example: 20% of $1 million is $200,000.
Big savings for companies
Dave Hershberger, president of Prestige Travel in Cincinnati, said he believed that 20% figure would be even higher -- 25% to 30% -- for companies that move from unmanaged travel to a thoughtful travel program.
Take unused air tickets. Prestige will ask prospective clients how they track them, and how many dollars in unused tickets they have.
"They have no idea," he said. "Industry numbers that I've heard on that is anywhere from 7% to 10% of your travel spend could be sitting out there in unused tickets. That's just one category. You take corporate air programs, corporate hotel programs. Following basic travel policy ... it's an easy number to get to 20%."