PREMIUM AIR TRAVEL
high
FLYERS
As corporate travellers get back to international flying, many will be looking for the extra reassurances that come with premium services, says Gary Noakes
A
fter an 18-month hiatus, business travel really does appear to be coming back. Thanks to the vaccination programme, the wiping of the red list and the long-awaited reopening of the US, it’s time to fly again. The tentative return is being reported from TMCs, buyers and airlines, with no shortage of willing participants. In June, a survey by SAP Concur of 500 UK corporate travellers and 100 travel managers found 99% were willing to travel in the next 12 months and 65% actively wanted to. In an October poll by the GBTA, 70% of members said they expect to see an increase in international business travel over the next six months as a result of US borders reopening. But the enthusiasm is tempered by budgets and safety considerations, so there are mixed messages emerging. Meon Valley Travel Group straddles both the corporate and leisure sectors. Managing Director James Beagrie says an initial surge in bookings came from the leisure sector, with a high enquiry to conversion rate. “Leisure bookings are corrupted by people going where they can. With business travel, people are waiting until they can go where they need to go. Generally, companies are saying we will start from next quarter. It’s the finance chief driving the decision," he says. “Rather than people spending more, it’s a case of firms starting at the top of the tree – the chief executive is travelling first.” 12
There is a high priority on traveller safety, he says, with "end to end care" in the shape of "a chauffeur from the house, being walked through the lounge, business class flights, booked meeting space", which means transaction spend is more. However, he adds flights are fuller "because there are fewer of them: BA has got rid of 40% of its fleet, so availability evaporates", with consolidation of poorly-sold departures adding to this issue.
A fine balance
According to Tom Maynard, Virgin Atlantic’s recently-appointed Head of UK and Europe Sales, the vast majority of the airline’s corporate travel is still in Upper Class. “Around 70% of revenue we get from TMCs is in the Upper Class cabin,” he explains. “Yes, we have seen some corporates downgrade from Upper to Premium and we’ve seen it happen the other way. I think it’s going to be interesting to see what is driving the decisions. It will be a balance of price, wellness and sustainability. I think wellness is playing a big part in those decisions to upgrade.” Many are predicting that corporates will be asking their executives to take fewer, longer trips, particularly when travelling long haul, to make their travel count. “I think it’s too early to see now but talking to a lot of our corporate customers that’s certainly an intention,” says Maynard.
“Rather than limiting internal travel and focusing on external travel, I think it’s going to be a case that if you’re going to do a longhaul flight, you’ll go for a whole week and do as many meetings as you can in that week, and rather than going every month, you’ll perhaps only go once a quarter. “Some customers are saying they expect their travel budget to stay relatively similar but it will be a different type of travel, so travellers can fly business class and maybe upgrade their policy and have more hotel expense, but they’ll do fewer trips throughout the year.” Bob Schumacher, United Airlines UK and Ireland Sales Director, says on some of the airline's departures, premium customers outnumber those in economy: “We are in nose-heavy flying posture,” he says. “What we’re finding is airplanes are flying quite heavy and not with the traditional global corporates, but with SMEs and a significant amount of high-yield leisure and mileage burn, so we’re getting heavier loads in the front than in the back, both in business and in premium economy. “There’s also probably some desire by travellers to have a bit more space.” Julie Cope, Managing Director TakeTwo Travel Solutions, concurs with clients seeking reassurance in spaciousness. “From a duty of care perspective, our corporate customers are questioning whether they should adapt their travel policy to allow employees to
THEBUSINESSTRAVELMAG.com
Air_v11.indd 12
11/5/21 09:51 AM
