Biz Travelers Flock to Sharing Services

Growing numbers of business travelers are using Uber, Airbnb and other shared economy services—and expensing them.

Concur reported that Airbnb transactions in employee expense reports jumped 2,700% in 2014. Uber now accounts for 41% of ground transportation expensed through Concur. In some cities, Uber tops taxis and traditional black car services for business travelers.

“Airbnb, in terms of inventory, has become the largest hotel chain in the world,” said April Bridgeman, managing director and senior vice president of Advito, the travel information arm of BCD Travel. “BlabaCar carries more passengers in Europe than Eurostar.  The sharing economy is changing managed travel and cannot be ignored.”

About 10% of Airbnb bookings come from business travelers. That was enough for the San Francisco-based company to create a business travel department in early 2014 and integrate its reporting system into Concur’s TripLink last summer.

Sharing grows share
Uber also joined the TripLink network that allows travelers to book direct through mobile apps, while conforming to corporate travel policy and getting automatic receipts for expense reports.

“Companies should not ignore the sharing economy,” reads a recent white paper from the CWT Travel Management Institute. “As brands adapt their offerings to the managed travel market, barriers to use in managed travel are coming down. This is a robust trend that is transforming society and business models, much like Facebook and Twitter before it.”

Shared services have popped up in almost every business travel service area, CWT noted. Uber, Lyft and Snapcar are eating into traditional taxi services. BlablaCar, RelayRides and Flightcar are taking share from rental car and train services.

Airbnb, BodyCasa and 9Flats.com are moving on the hotel market. Jetsmarer, BlackJet and FreshJets offer seats on private jets that compete with airline offerings. BirdOffice, Sharedesk and pivotdesk provide on-demand office and meeting space. VizEat and EatWith give travelers alternatives to traditional restaurants.

A question of management
For many companies, the question is not whether to allow shared services but how to manage them.

The sharing economy isn’t so unworkable that companies should ban it without investigation, Bridgeman said. Nor is it so free of problems that companies should allow travelers to use sharing service providers without ground rules and monitoring.

Salesforce.com was among the early adopters, she continued. And while the company is known for its flexible booking policies, it set three ground rules for Airbnb: no treehouses, no boats and no couch surfing. Automated reporting via TripLink eases concerns about duty of care and data integration.

“These services are in all of the major markets where your people travel,” Bridgeman said. “The only real question is whether there needs to be a formal place in your program for them. Talk to your travelers to see how and where and when they are using shared services. Engage with the suppliers like you would any other service provider and determine whether they add value to your existing program.”

Five factors at play
Five factors enter into the value equation: cost, traveler satisfaction, safety, regulation and integration/data capture.

Airbnb typically undercuts hotel costs by 21%. But Airbnb is not the same product as a hotel room. Some travelers prefer Airbnb even though they have to wash their own dishes and make their own beds. Other travelers are happier in a full service hotel.

Traveler satisfaction is just as slippery. Uber is infamous for surge pricing that inflates costs. But CWT noted that Uber picks up 90% of passengers within 10 minutes compared to 30% to 40% for traditional taxis.

“That 90% pick up is a big deal to travelers who are on a deadline,” Bridgeman said. “And if surge pricing allows your traveler to get to a revenue-generating client meeting on time when airport taxis are backed up for an hour, it might be worth an extra £20 at Heathrow.”

Questions about safety and regulation are probably overblown, she continued. As shared services mature, so do safety, insurance and compliance with local regulatory requirements.  In some areas, shared services may be an improvement over traditional suppliers.

There is no record when travelers get into a traditional taxi, for instance. But every Uber pickup and drop off is tracked by passenger, driver and location, which enhances overall safety and security. The decision to go with shared services or traditional providers depends more on company culture and individual traveler preferences than travel policy.

Integration is changing almost by the day. A year ago, integrating Airbnb and Uber trips into managed travel systems was a chore. For companies that use Concur, integration has become automatic.

“Shared service vendors recognize that business travel is a significant and growing percentage of their user base,” said Claire Ollivier, senior managing consultant for Advito. “They are working on integration with managed travel programs, but it isn’t always easy.

“The situation is changing and will change even faster in the near future. Integration is coming. It is time to make space in your program for these new providers.”