In response to changing industry dynamics, leading global travel management company BCD Travel has unveiled its own dedicated global hotel division – Stay by BCD Travel. The new business, headed by its recently appointed senior vice president, hotel solutions, April Bridgeman, will offer “a dramatically new approach to managing hotel programmes,” it claims.
The new global hotel division will provide benefits to BCD’s current and future clients “by accelerating their ability to innovate within the corporate travel landscape,” according to the travel management company. It will comprise a range of newly created positions and redirected staff from BCD and its consultancy practice, Advito.
Stay by BCD Travel will offer spend management, content aggregation, shopping and booking, virtual payment and digital invoice management, price assurance, hotel rate availability management, analytics, awareness and adoption campaigns, merchandising, and the use of frequently updated market-level rate targets.
Under the control of Ms Bridgeman, who will also continue to lead Advito, will bring increasing strategic alignment with he hotel space and provide a comprehensive view of spend across travel categories, including hotel, air, rail, car and ground, among others.
“Hotels are the most critical battleground for customers,” explains Mike Janssen, global chief operating officer and chief commercial officer at BCD Travel. “They represent the second largest spend category in travel and are increasingly the measure by which programmes succeed or fail, whether we’re talking about savings or satisfaction.
With Stay by BCD Travel and an “innovative, data-driven hotel approach” he believes the company is now perfectly placed to help travel and procurement managers “win this battle”. BCD will now go beyond the industry’s emphasis on resource-draining seasonal sourcing. It will focus on spend management strategies such as merchandising, market-level rate targets and price assurance. Using digital marketing and merchandising to build traveller awareness of the hotel programme, it hopes to deliver increases programme adoption and influence buying decisions, as it says, “yielding more value with less effort”.
“Great hotel programmes are nothing if you don’t drive adoption,” says Ms Bridgeman. “When you focus on bringing people into the programme and invest effort into spend management strategies beyond sourcing, you’ll achieve materially better results than traditional approaches. It’s time to shift resources to strategies proven to add more value.”
As an example, BCD Travel highlights an unnamed client in the global medical technology company that reduced its number of negotiated markets by 55% – instead setting hotel target rates as spending guidelines for travellers. Through that switch alone, it says they achieved 4.9% incremental savings in those non-programme markets. Similarly, another client, a well-known food manufacturer, drove up hotel attachment by 139% year over year through a carefully calculated awareness and adoption campaign, it explains.
BCD Travel’s more powerful approach to hotels is fuelled by multi-year sales success and a competitive growth plan that has allowed the company to reinvest over 40% of earnings back into technology and infrastructure. That investment also resulted in significant growth of BCD Travel’s digital platforms, including DecisionSource, an analytics and intelligence platform for travel managers; TripSource, a trip management, traveller engagement and booking platform; and SolutionSource, a marketplace of authorised technology solutions that extend the corporate travel programme.
Stay by BCD Travel “will deliver a profound impact on hotel programmes” through two core strategies: savings beyond sourcing and programme adoption, claims the travel management company. It recommends significant reductions in negotiated hotels for most clients, and focuses on other spend management strategies that yield more value and more savings with less effort. “Those strategies typically result in programmes that travellers prefer, too,” it explains.
Sourcing has always been the primary strategy to manage hotel category spend, but the incremental savings achieved through sourcing are shrinking, says BCD Travel, and the value derived is not commensurate with the effort. In addition, it says, data indicates that most companies source hotels in markets where they don’t have leverage, include too many hotels in the programme to maximise negotiation results and include the same properties in their programme year after year, delivering a weak, non-competitive negotiating position.
Similarly, Stay by BCD Travel will “drive adoption, build consumer confidence, influence buying decisions and win loyal advocates for the hotel programme,” it says, thanks to BCD Travel’s existing advanced digital marketing strategies and consumer behaviour expertise. This is backed by its content inventory from a variety of sources, including traditional global distribution systems, hotel booking agencies and aggregators.