B2B Payments

Lola On Moving Beyond A Consumer-Like Experience In Corporate Travel

For corporate purchasers, offering the “consumer-like experience” has become the gold standard for FinTechs developing ways for businesses and their employees to more easily buy goods and services. It’s a trend dominating the B2B eCommerce and eProcurement world, but those segments of business spend are far from the only areas where consumer purchasing behavior is influencing the business space.

In corporate travel booking, employees, often left to book and pay for their own business travel, are ushering in their experiences as individual travelers into the office.

Mike Volpe, CEO of corporate travel booking site Lola.com, told PYMNTS in a recent interview that the pursuit of the consumer-like experience can trip up organizations — especially in the middle market — but also guide their strategies for a better travel and expense (T&E) strategy.

“Individual employees are having a stronger and stronger voice in purchase decisions [in the enterprise],” he explained. “Ten years ago, the finance department would buy whatever tool they wanted and force employees to use it.”

Today’s current market climate of minimal unemployment and competitive hiring environment make employee satisfaction even more crucial to employers, and the way companies handle their employees’ travel needs is no exception.

But there’s a gap in the market, Volpe said, particularly for smaller- and middle-market firms. Without agile and user-friendly solutions to book business travel, employees — ever in pursuit of solutions that mirror the same processes they have in their personal lives — will simply turn to consumer sites like Kayak and Expedia to book business travel.

That opens the door for loads of wasted spend, according to Volpe. Employees are more susceptible to booking unnecessarily expensive travel plans, like first-class airfare or fancy hotels.

Beyond The Consumer-Like Experience

He emphasized that it is critical for any B2B travel booking platform to provide a consumer-like experience for employees booking their own travel. But beyond simply mimicking a consumer portal, these solutions have to elevate the experience even higher to address the middle-market’s more sophisticated travel booking needs.

Volpe offered the example of consumer travel booking platforms that automatically show flight options with layovers. Business travel sites must prioritize direct flights, he said, because timeliness is essential.

“Not only can you not jeopardize [the end-user experience], it is essential,” he said, adding that if a business platform offers a poor experience, employees will revert back to those consumer solutions that fail to tailor to the unique needs of a business traveler.

The consumer travel space certainly has an influence on Lola, particularly as its co-founder is Kayak Co-Founder Paul M. English. But the company now aims to surpass the consumer booking travel experience to address the underserved middle market.

By offering employees a consumer-like experience, and offering their employers tools that address their needs, organizations can promote adoption of B2B travel booking tools that enable firms to enforce their business policies, preventing employees from wasting company money.

The ability for B2B travel booking portals to gain further traction in the market will have additional impacts on the broader corporate travel and expense management space, too, said Volpe.

Middle-market firms will increasingly recognize the cost-saving potential of adopting a business travel booking solution tailored to their needs, he said, predicting that as service providers focus on the end-user experience coupled with more sophisticated needs for a business client, technologies like on-demand traveler support and mobile chat communication tools will become increasingly important to this market.

“I predict in a few years there will be almost zero interactions with vendors in the T&E space that will take place by phone or by email,” he said. “It will be conversationally chat-based.”

Further, Volpe said he expects the growing adoption of these tools to have broader impacts on businesses’ T&E strategies overall, most notably in the shift away from forcing employees to front the bill.

“I believe the world is moving to a place where the whole process of reimbursing the employee goes away,” he said. “I think that will come about because with these tools, companies have more say in what’s being purchased in the first place.”

Today, he said, the reliance on consumer portals and employees’ unmonitored ability to book extra-expensive travel means businesses can be reluctant to hand a company card to their workers. When platforms can automatically adhere to company policy without compromising user experience, businesses will be more confident to allow employees to make purchases with corporate cash.

“If you give companies the right amount of control, and people aren’t buying first class tickets, companies are more willing to use their money,” added Volpe. “It’s less of a burden on the employee to carry that credit, and the whole process of reimbursement goes away.”

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New PYMNTS Report: The CFO’s Guide To Digitizing B2B Payments – August 2020 

The CFO’s Guide To Digitizing B2B Payments, a PYMNTS and Comdata collaboration, examines how companies are updating their AP approaches to protect their cash flows, support their vendors and enable their financial departments to operate remotely.

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