New analysis from the “U.S. Corporate Travel: Market Sizing And Trends” report could be bad news for some of the mobile and electronic payments players hoping to upgrade the corporate expense management industry.
Research released by Phocuswright this week, along with new data from the U.S. Travel Association’s Leading Travel Index, suggest that corporate travel spend is in a slump.
“We did see a nice recovery in the market, but we don’t see it coming back as fast as leisure,” said Phocuswright SVP of Research Lorraine Sileo in response to the report’s findings. “Companies are being a little more conservative in their spending.”
Forecasts from the research group for 2017 suggest that while gross bookings are increasing, the rate of growth has decelerated. Further, the report concluded that the so-called “mobile revolution” in corporate travel and expense management has not yet made as significant an impact on the industry as some may have hoped or expected.
Less than 20 percent of business travelers booked air tickets on a smartphone, for instance; only about one-third booked a hotel room on their mobile device. That’s despite rising instances of corporate travelers researching these travel services on their smartphones.
“We found, on the corporate side, that mobile was bigger on the expense side or just being able to communicate with the traveler; it wasn’t really utilized to a big degree,” concluded Sileo, according to reports by Skift. “Travel management companies that want to become this end-to-end solution need to be able to provide services and integrate more tools that do itinerary management and location-based services.”
“We didn’t see that much innovation at that point, when price-tracking tools, like TripBAM, and peer-to-peer services can really change the marketplace,” the researcher continued.
The findings were presented against the backdrop of the most recent Leading Travel Index, which found that domestic U.S. travel will likely continue to decline over the next six months.
“Even though domestic business travel declined and flagging advance airline bookings from abroad brought the Leading Travel Index down slightly, these number[s] should be measured against the healthy growth seen in previous months,” stated U.S. Travel SVP for Research David Huether.