What's Happening?
A recent study by Trip.Biz, the business travel brand of Trip.com Group, highlights significant challenges in the business travel sector, particularly in the Asia Pacific (APAC) region. The study, titled 'The Invisible Spend in Business Travel,' reveals
that 53% of business travelers book outside approved corporate channels due to missing content, leading to invisible spend and compliance issues. The research indicates that nearly one-third of companies using a corporate online booking tool report that 20% or more of their travel spend occurs outside the approved platform. The APAC region is identified as the most fragmented market, with a high reliance on alternative booking arrangements. This fragmentation is attributed to content gaps and the need for workarounds, such as using local agencies or direct supplier bookings, especially for cross-regional trips.
Why It's Important?
The findings of the Trip.Biz study have significant implications for the business travel industry, particularly in terms of financial management and compliance. Invisible spend, which occurs when travel expenses are not captured within managed programs, poses a risk to cost savings and traveler safety. The study notes that incomplete trip capture affects the ability to manage duty of care and policy compliance, with 91% of travel managers expressing concerns. Additionally, the reliance on alternative booking arrangements in the APAC region complicates efforts to consolidate travel programs across different markets, impacting multinational companies. The study suggests that addressing these challenges requires broader access to integrated content sources and the adoption of artificial intelligence (AI) to optimize travel management.
What's Next?
To address the challenges identified in the study, organizations may need to enhance their travel management systems by integrating more comprehensive content sources, including New Distribution Capability (NDC), low-cost carriers, and local travel inventory. The role of AI is expected to grow in managing travel complexity, optimizing supplier performance, and generating strategic insights from travel data. Companies that can make invisible spend visible are likely to benefit more from these technologies. As the industry evolves, travel managers and finance teams will need to collaborate closely to improve compliance and financial oversight, potentially leading to new strategies and tools for managing business travel more effectively.
