Just this past month I have had so many enquiries from travel businesses and tour operators that traditionally focus on business travel who are now wishing to make the switch to more leisure travel and in-destination experiences for B2C. Driven by the devastating after-effects of the pandemic, B2B travel is now seen by some as a dead end, so the question for others who focus on business travel is… should you switch or at least add a B2C element?
First, let’s take a look at what is currently happening in the business travel sector.
First let me say that there will always be business travel as it is a necessity for some professionals to meet in person and to make connections; people need to visit factories and to simply get to work in far away destinations But we are seeing a massive shift in how frequent these trips will be. Business travel for the likes of sales and potentially conferences will be much less frequent, with companies choosing the ones that are absolutely necessary… more on this later.
Many CEOs have already come out to say that business travel as we know it is a thing of the past, including Greg Hayes — SEO of jet-engine maker Raytheon Technologies who said, “About 30 per cent of normal commercial air traffic is corporate-related but only half of that is likely mandatory.” [see article here - www.straitstimes.com/business/economy/forever-changed-ceos-are-dooming-business-travel-maybe-for-good]. Having saved billions from slashed travel budgets during the pandemic with only a marginal impact on operations, many companies will be hard pressed to explain why they’d return to their old ways.
Even at the small scale end of the business sector, my own business included, we have done everything to cut unnecessary costs. TMA has given up offices permanently and now all work remotely for example, and we’re unlikely to go back as I would prefer that money was used to hire extra team members. Even companies who do return to an office are now providing more flexible ways of working as this flexibility has worked for the last 2 years.
We have all seen the benefits of Zoom calls, chatting over Slack, without the need to leave your home. This is now ingrained into our psyche and is not going to change any time soon. It is these factors that business-focused tourism companies have to seriously look at. Will it still be a viable sector to do business in?
Like I said earlier, we will always have business travel, but those monthly trips that businesses may have done in the past will now only happen 2-3 times a year… If it is deemed absolutely necessary. You have to remember that no matter the size of your business, 2 years of lost revenue is still going to hurt and it may take another 5 years for some of these businesses to get back to 2019 levels. So something has to give.
As I write this article, the BBC has just released a survey (www.bbc.co.uk/news/business-58559179) that, in the UK at least, 79% of senior business leaders said that it’s likely that people will never return to offices at the same rate as before the pandemic. This means more people working from home because these businesses realise that doing so, conducting Zoom calls etc has not affected their output. If anything it has actually increased. All this will have a massive impact on business travel… but it also creates opportunities.
While businesses are more likely to travel less as a whole, the same can not be said for their employees. Because working from home has become normal, so too will working from anywhere.
Employees now have the option to work from any destination they wish as they are not restricted to the confines of an office. This means that there is a massive opportunity to tap into the digital nomad era as these same workers will still wish to experience new destinations. So although they may be working from anywhere, marketing to them could still take a B2C angle.
TUI has recently capitalised on this by offering all-inclusive ‘workation’ packages. (www.travelgossip.co.uk/latestnews/working-from-home-move-your-office-to-an-all-inclusive-resort-urges-tui)
Accommodation businesses, AirBNB,s etc, will all do amazing trade in this sector, but operators should also do well if you get your messaging right. Maybe you can create ‘Digital Nomad Tours’ focused on this particular niche, either as an in-destination tour provider for this particular traveller or by offering multi-destination travelling with a ‘take your desk anywhere’ twist!
Business retreats is also a sector I can see growing rapidly. Although businesses may travel less often and to cater to those who work from home, and have done, more often than not, taking their staff on a retreat to allow them to come together, bond, and learn will become more commonplace. For those already selling to business travellers, this gives you an opportunity to use existing products in a slightly different way.
One sector that may have an opportunity, eventually, is the events sector. Although business travel will be less common and more focused when it does occur, more businesses may choose very important events for their teams to attend, so they can still meet their customers and partners all at the one time, in the one place, replacing the regular trips they may have done in the past. The increased rarity of these kinds of events will add significantly more importance to them, which may increase what businesses are willing to pay — but this is just an educated guess.
Let me know what you think. Are you making the switch? Do you see business travel going back? Love to hear your thoughts.
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Comments
I haven't been on a plane for 1.5 years! And here's a good use case for remote business building... we created and launched Travel Massive's new community platform (that you're reading this post on) with a 100% remote team, based in Tasmania, Bulgaria, and Melbourne.
Perhaps as travel re-opens we can take Travel Massive on a giant co-working road trip to visit everyone in the community... would that be business travel? 🤔
That the future of business travel. That and business get-aways with their teams once per year, but gone are the more regular trips I feel.
What can be digitalised, will be, and "more of less" is the future. I´ll quote a bit from the latest Business Travel Report Germany, my representative yearly study (based on CATI with 800 managers repsonsible for business travel in companies and public organisations) for VDR the German Business Travel Association (originals available via www.geschaeftsreiseanalyse.de):
1) 80% of larger, 72% of smaller companies and 81%of repondents from the public sector expect a long-term reduction in business travel. The actual extent of this decline remains to be seen, but if these forecasts are correct it will be an average of 30%.
2) In the question on expected and actually desired future meeting formats there was a tendency towards online fatigue. Only 3-5% of companies would prefer purely online events. Although zoom-fatigue has not completely taken over, the majority would prefer more face-to-face meetings or at least hybrid concepts going forward.
3) Whether in the selection of modes of transport, hotels or even in the organisation of events – travel managers are key disseminators who can make an important contribution towards sustainability. Today, over 90% of respondent travel managers from companies and 97% from the public sector say that sustainability will become a competitive factor in the selection of service providers – a significant rise compared to last year. Specifically: Among smaller companies, 73% plan or are already implementing measures to ensure a better environmental footprint, among larger companies this figure is 85%. Business travel volume is being reduced or will be reduced at 87% of all companies for environmental reasons. For travel within Germany, 73% of respondent companies have shifted from air to rail travel. The European railway system will also profit from this shift.
"As already seen last year, crisis also brings opportunities. The economic recovery will be defined by new opportunities to shape the future, and this will also be seen and experienced in the realm of corporate mobility. The backlog of business and private travel will initially trigger a boom, while the period after that will be shaped even more deliberately than in the past; this will be based on new models of working that are already on their way. We have all learned one thing during this period of restricted contact: Face-to-face meetings will not be replaced by online meetings anytime soon. It will be all about situation-dependent alternatives.
Mobility managers will contribute their experience and thus a new quality to the working world; our ways of working and tools as well as the willingness to use them have changed and developed very fast. Some positive effects will be less traffic congestions due to commuting and more working from home. Work/travel-life balance can take on entirely new forms. Younger employees in particular will tend towards “bleisure” (combining business and leisure) and “workcations”. We will see more digital nomads, and sometimes choose 100% remote working with occasional and therefore exceptional team building events. Travelling for business may become more of a privilege and motivation again.
Entirely new ideas of what (global) citizenship means are also foreseeable. Although national regulations made cross-border travel an administrative nightmare once again this summer, the EU has already laid plenty of fundamental groundwork. Standardisation, reliability, transparency and digital services in international cooperation are key here."
Here's a great article I came across titled: "Why airlines need business travel to return"
thehustle.co/why-airlines-need-business-travel-to-return/
^ Interesting bit of research... only 25% of business travel is for sales generation (the rest was trade shows, company meetings, commuting, etc.)