Growing Corporate Market Prompts ASTA’s First Biz Travel Conference
by Robin Amster /ASTA’s upcoming Business Travel Exchange, a first for the association, is designed to help small- to mid-sized travel agencies tap into the growing market for corporate travel.
The one-day event, slated for April 30 in Alexandria, Va., is a response to ASTA members’ interest in corporate travel, said John Pittman, ASTA’s vice president, industry and consumer affairs, research.
The event’s sessions will address the tools and technology needed to manage business travel; provide insights into integrating a mix of leisure and corporate business, and detail ways agencies can sell corporate services to local businesses, among other topics. (See sidebar).
Important to members
“Managed travel is very important to some of our members and an opportunity for others,” said Pittman. “We’ve seen more interest in this area from small- to medium-sized members.”
ASTA’s Business Travel Exchange is targeting member agencies with annual bookings up to $50 million.
Unlike mega-agencies and TMCs that have the resources and staff expertise to deal with the challenges of serving the corporate market, smaller and mid-size agencies “don’t have the in-house resources to answer all the questions they are confronted with,” said Pittman.
Prime time
It’s a particularly good time for agencies to take on the corporate market, or increase their share of corporate travel business, according to Pittman.
One reason: the growth of regionally based businesses like community banks. While small- and medium-sized agencies aren’t equipped to take on large corporate accounts, they are well-placed to handle corporate travel for these smaller businesses, Pittman said.
“And people want to do business with people they know; people that are part of their community” he said. “It’s a matter of building a business to meet that demand.”
A bigger piece of the pie
Pittman cited a 2011 PhoCusWright study, the Travel Agency Distribution Landscape 2009-2013, which showed that corporate travel accounts for a growing share of travel agency business.
The study forecast that leisure sales would drop to a 28% share of agency business in 2013, down from 30% in 2010, while the corporate share of agency business was forecast to increase from 70% in 2010 to 72% in 2013.
Different business models
To build corporate business, travel agents need to master a different skills set from the one required for doing leisure business, Pittman said.
“Leisure and corporate are two distinct markets,” he said. “Twenty years ago there was the commission-based business model. Today, leisure is still commission-based but the bulk of corporate business is transaction fee-based.”
“It [breaking into the corporate market] can be done successfully, but it does require a skills set unique from leisure,” he said.