Before the internet came along, there were clear divisions between how companies sold to us as private consumers, and as business people. The way we bought their products and services were different too.
Even today, unlike typical online shopping experiences, corporate purchasing tends to be slow and cumbersome. As one CEO pointed out recently, “why isn’t there an app for procurement?” Online shopping is usually quick, simple and frictionless. Consumers receive shopping recommendations, can compare prices, warranties and reviews so their choices are better informed.
By comparison, corporate purchasing is slow, driven by the desire to control spending by reducing user choice. Prices are negotiated in advance without scope for adjustment to account for changing market conditions.
Not any more though. Business travel is being increasingly ‘consumerized’ as travelers look to make choices based on what they want, as opposed to what the company tells them they want. In practice, more employees are booking outside company policy because the range of products available to them within policy are not acceptable to them.
This trend highlights increasing dissatisfaction amongst business travelers with company-approved planning and booking tools. Although 27% of travel managers say they do not mandate a specific company booking tool, of those who do, almost a third – 27.27% say the company’s tools are not as good as those they use for personal vacations.
Truly effective travel programs are now critical to achieving business objectives, from optimizing employee productivity to talent retention. Consequently, travel management companies are under mounting pressure from an increasingly diverse group of customer stakeholders to balance cost, compliance, traveler satisfaction and security.
Add to this mix the popularity of Amazon-style purchasing, and you have a market in which the business traveler of 2019 has unprecedented influence on based on business travel policy and programs. Ironically, the degree of personalization being made available to business travelers is way in excess of that available to them for private purchases.
Thanks to rapidly evolving technology, TMCs have an unprecedented opportunity to deliver truly integrated, traveler‐centric products and services. Consumerization follows mobile, e-commerce and the internet as the fourth phase of industry disruption. The ball now being picked up by TMCs is that of implementing solutions that will enhance the customer experience.
In many respects, business-to-consumer (B2C) marketing is showing the way to better B2B procurement by prioritizing the customer experience. In business travel, adopters will see happier travelers, better compliance and a more strategic approach to spending the company dollars.
The driving force behind the digital consumer revolution is the concept of the customer journey; the different stages through which the consumer interacts with the supplier. Traditional corporate systems were built around complex business processes or obsolete technology.
Whilst travel managers and TMCs work together to ensure that travel programs offer the breadth of product travelers require, delivered using systems that are intuitive, simple and easy to use, employers are having to invest in redesigning their procurement functions.
It’s worth it though – just ask Amazon, Airbnb, or Apple.