TMCs must face challenge of online bookings

The growth of online bookings will be the biggest challenge and opportunity for travel management companies in 2005.

The prediction came from the Guild of Business Travel Agents following a poll of its 35 members.

Many members of the guild, which changes it name to the Guild of Travel Management Companies in January, have online booking solutions of their own, and want to see greater adoption levels from business travellers.

But a significant proportion believe the uptake will not be as quick or as large as industry outsiders suggest.

Guild chief executive Philip Carlisle said: “The online environment provides our members with a great way to reduce their own costs – savings which can then be passed on to the clients – but it also helps to underline the unquantifiable value of the personal service that only a truly professional travel management company can provide.

“There are big savings to be made through online bookings but our members are taking a responsible, realistic view. Corporates use travel management companies precisely because we can offer a level of service that is beyond even the most sophisticated technologies.”

Other trends for next year identified by the GBTA include:

*An increase in rail travel bookings, possibly at the expense of car rental.

*Greater focus by TMCs on winning business from small and medium-sized companies.

*Growth in short-haul travel volumes.

*An even greater emphasis on staff training.

“The general consensus seems to be that travel volumes will continue to rise in 2005,” said Mr Carlisle. “But members also agree that their corporate clients will still be keeping a close eye on costs.”

The GBTA’s latest quarterly transaction survey for the traditionally-quieter July-September period shows a nine per cent rise in bookings over the same three months last year.

Air bookings were up eight per cent to total 1,462,295, hotel bookings rose 14 per cent to 349,998 and rail bookings grew by six per cent to 480,888. Car hire continued to decline with an eight per cent drop from 51,207 to 47,144.

The biggest increase was in ancillary bookings such as car parking, travel insurance and visa services which were up 20 per cent. In the year to the end of September, ancillary bookings rose 16% against the previous 12 months, compared with a seven per cent increase in bookings generally.

Report by Phil Davies