Summary:
Travel sentiment studies can give mixed messages, but new research from Corporate Travel Community (CTC) provides some insight into the minds of travel buyers and a key outlook on business travel. In a recent survey of over 200 travel buyers spread mainly across Asia and the South Pacific it found that the majority of respondents were confident that corporate travel demand would return within six months - one in five respondents (20.5%) said they would resume corporate travel immediately when government-imposed travel and border restrictions and quarantine requirements allow. In total, more than three quarters (75.2%) expected travel to resume within the next six months.
In unprecedented times we do not have the safety of a text book to help chart our course and are crying out for expert guidance. One of the main problem with the numerous studies is that those being surveyed are not clearly enough defined and when based simply upon 'someone who has travelled for business at least once in the last 12 month' or those 'with an annual household income above USD75K' do not necessarily accurately define the thoughts of specific traveller demographics.
The varying figures for when travellers will feel comfortable to travel can vary significantly based upon whether that is a leisure traveller seeking some sunshine, a family member travelling to catch up with friends and relations after an extended lockdown, or a business traveller visiting an overseas client. These can often blur sentiment studies and deliver more generic insights.
Some can make you feel really positive, but maybe purely be based on the leisure sentiments, which vary considerably from corporate demand. The research that has focused on the latter areas has tended to offer a much more pessimistic viewpoint.
New research from the Corporate Travel Community (CTC), a network of corporate travel buyers and other personnel who manage their organisation's travel portfolios, provides a little more insight specifically into the travel buyer mindset. In a recent survey of over 200 travel buyers spread mainly across Asia and the South Pacific it found that the majority of respondents were confident that corporate travel demand would return within six months.
Right now most of us would happily forget 2020, but with concerns that many countries have not stopped first wave infections following uplifts in Covid-19 cases across parts of Asia, Australasia and Europe, ongoing spread across the Americas and fears over a second wave later in the year as northern hemisphere temperatures dip, the outlook for 2021 was starting to also look concerning.
The CTC findings bring a little renewed optimism for the corporate travel sector. The respondents are accountable for travel spends that range from local markets and annual spends of USD1-USD10 million, through regional (above USD10 million per annum), up to large global and over USD20 million per annum and cover sectors that include government, education, mining, resources, professional services, sport, FMCG, NFP, automotive, medical and pharmaceutical and banking and finance sectors.
One in five respondents (20.5%) said they would resume corporate travel immediately when government-imposed travel and border restrictions and quarantine requirements allow. More than half (54.7%) expected travel to resume in the next six months. One in five (22.4%) were a little more cautious and said travel may not resume for up to 12 months, while a small number (2.4%) cautiously warned that it would be longer than 12 months.
These findings do bring a little optimism to the recovery of the business travel sector. Until now, even with the addition of special trade corridors and protocols designed to support the needs of corporate travellers, demand has remained severely diluted.
[perfectpullquote align="full" bordertop="false" cite="" link="" color="" class="" size=""]"One in five respondents (20.5%) said they would resume corporate travel immediately when government-imposed travel and border restrictions and quarantine requirements allow. In total, more than three quarters (75.2%) expected travel to resume within the next six months."
Corporate Travel Community (CTC) Survey, in conjunction with ATPI[/perfectpullquote]
The ATPI Group, which delivers corporate travel and events solutions to organisations operating in a variety of specialist sectors around the world, acknowledges that the outlook remains cloudy, but acknowledges that there is clearly light at the end of the tunnel of what has been one of the biggest crisis for the managed travel sector.
Peter Muller, international board director at ATPI tells The Blue Swan Daily: "While we have remained busy with activity in our Marine and Energy sectors throughout Covid-19, the business travellers in less essential sectors have all but disappeared in Australia."
Specifically highlighting the findings from the CTC survey on the travel manager insights into the resumption of corporate travel Mr Muller says: "The feedback from our customers is in line with the survey results, some are on the starting blocks, just waiting for the gates to open, others are taking a more cautious approach and shelving travel plans to well into the future."
"The problem for the industry is that the goalposts are moving all the time, and with no historic data for this sort of thing, it's hard for companies to plan their policy around a lot of unknowns. We can certainly help our customers with our Prepare, Policies and Permissions strategy so that when they are ready to travel again, there is confidence, both for the company and the traveller," he adds.
A look back at previous crises - whether health care or economic downturns - shows that business travel will recover. The coronavirus may have delivered a mixture of both and a bigger impact on what arguably is also a much bigger sector, but there are already signs of how the sector will adapt as it recovers.
Corporate travel budgets will certainly be more constrained in the future as companies continue to be under financial pressure even as the economy improves. In addition, while historically GDP growth and air travel have been highly correlated, surveys suggest this link has weakened, particularly with regard to business travel, as video conferencing appears to have made some inroads as a substitute for in-person meetings.
Is the glass half full or half empty? I guess that depends on if you are an optimist or pessimist! The CTC travel buyers research, like all data, is open to individual interpretation. Business travel will be different, certainly more efficient. It is just a question of when it will get back up to scale.