The business travel and expense (T&E) management space is one of the most active when it comes to new market entrants and innovations for businesses. In part, that’s because young FinTechs are developing sophisticated tools to help companies track spend on business travel. It’s also because well-established travel companies like Lyft and Airbnb are stepping into the corporate travel space as analysts expect the global corporate T&E market to continue to grow (GBTA analysts estimated corporate spend on travel topped $1.2 trillion in 2015).
Amid this ecosystem of accelerated activity is the travel management company (TMC), which is now tasked with guiding companies through a maze of new services and solutions.
Jim Hartnett, vice president of Global Supplier Management at TMC Carlson Wagonlit Travel (CWT), said that’s not necessarily easy in today’s climate.
“There is so much change happening, and it’s happening fairly quickly,” he said in a recent interview with PYMNTS. “I’m just speaking for myself, but a lot of times I’m not sure which one of these technological advances is going to really be the one that makes a huge difference, or which one is going to work well for the client.”
When it comes to helping businesses adhere to their own corporate travel policies, TMCs are challenged to understand which services can meet their clients’ needs, he added. What he does notice, however, is that the new solutions that seem to be successful are those that can provide a value-added service to the company via data analytics of trip information, spend and more.
“The services that are going to be successful are the ones that improve the customer experience and, while they’re doing that, provide the client with the data and analysis that allow them to monitor and track compliance for their travel programs,” he said.
One company that Hartnett said has proven its worth in corporate travel is ridesharing company Lyft, which recently announced a partnership with Carlson Wagonlit Travel — its first with a travel management company — as Lyft deepens its presence in the corporate travel space.
“We can clearly see that this is a space that’s definitely developing momentum, and that’s apparent even by the growth that Lyft has experienced in the last couple of years,” the executive noted.
Indeed, recent data from corporate travel and expense management company Certify points to Lyft’s ongoing growth in use by corporate customers. Lyft saw a 3 percent increase in business travel use in the third quarter of 2017, Certify said, though the company is still significantly behind its largest ridesharing rival, Uber, which accounts for more than half of ground transport billings among Certify’s business users.
Interestingly, Certify found that Lyft’s 3 percent gain was its largest since the company began tracking such data. Part of Lyft’s success can be attributed to its ability to provide that data analytics corporates need today from their travel suppliers, Hartnett noted.
“Quite frankly, I think in a lot of cases, employees are already using ridesharing services to some degree,” he said, adding that companies have begun to integrate Lyft and similar services into their travel management policies so they can gain access to the data provided by these apps that their employees use anyway.
“Lyft offers clients real-time data, and it enables companies to quantify and monitor Lyft usage and spend,” the executive continued. “There is a reporting aspect to [their services].”
In recent years, Lyft has launched its B2B service, Lyft for Work, Lyft for Business and several integrations and capabilities designed to not only help business travelers use the ridesharing app, but to be able to record and submit spend data from Lyft into existing expense management platforms. Now that the company has begun to partner with travel management companies, it seems the firm is confident in its growth among business travelers.
But not everyone is on board with such services quite yet, said Hartnett.
“From a customer perspective, it’s very easy to use, and a lot of young travelers are getting into the business world, and a majority of these folks are already very comfortable using ridesharing or ride-hailing services,” he explained. It varies, however, in how businesses react to their employees’ use of such solutions, continued Hartnett.
“It depends on the client and what their specific needs are,” he noted. “We’ve got some customers who are asking for it, and we have others who aren’t ready to move forward with it yet, for whatever reason.”
As more sophisticated technologies become available to the corporate traveler, Hartnett said it’s the TMC’s job to help clients understand what could work for their organizations, and what tools may need a bit more time on the market to prove their effectiveness. Lyft is one of those solutions, he said, that’s penetrating the corporate travel market and providing a better experience for travelers, while empowering businesses with data analytics they need to more efficiently spend on travel.
But Lyft’s market entrance in corporate travel is a new one, and even newer is its step into collaborating with travel management companies. Hartnett said that, as more innovations target disruption of corporate travel and expense (T&E), travel management companies and their corporate clients will have to deploy a bit of a wait-and-see strategy to understand which tools should land in corporate travel policies.
“We’re the first travel management company that Lyft has introduced a cooperation with, so I think there is a lot of learning that still has yet to take place,” he said. “But I think we’re diving into some of these relationships where we think it will improve the customer experience, and it will be good for the traveler — and with those benefits, I don’t think you can go wrong.”