I find it almost impossible to believe that as we are about to turn the page on another year (I could swear I was just heading out east for a long Memorial Day weekend), travel managers continue to struggle with their hotel programs. Most readily admit to having program leakage that ranges anywhere from 40-60%. I ask myself, how can it be that after all the time, resources and focus applied to the corporate hotel program, in many cases more than half of a company’s hotel bookings are escaping the managed travel environment?
Some would suggest it’s the millennial effect, or the AirBnB effect, or the suppliers-more-overtly-going-direct effect – all fairly recent developments that could be assumed as contributing factors. But after reflecting on this a bit, I’m not buying that millennials, the sharing economy or direct bookings are the cause here.
I say that because as I was doing my research for this piece, I Googled the words “hotel attachment rates,” and found the top search result was a blog posting written by yours truly way back on October 4, 2010. You can read the whole piece here, but apparently hotel program leakage was a problem before AirBnB and these non-conforming Millennials appeared on the scene.
Not much has changed in five years, so what should we make of this? Can the problem of hotel program leakage be solved? History would suggest not without making some changes, but what changes should be made?
If you’re a travel manager looking to fix this problem, do you take Concur’s TripLink path by admitting leakage is a way of life and then try to capture those bookings made outside the program? Do you go for incremental savings on the bookings made within the program by introducing TripBam’s solution? Or do you get the eCommission Solution to ensure you’re getting your negotiated rates and all the commissions your program is due? Or maybe you outsource the whole procurement and booking process to HRS, and let them help you figure it out. One thing seems certain: The time for a business-as-usual approach is over for any travel manager who really cares about their hotel program.