New Tool Rewards Frugal Biz Travelers With Cash Payouts
by Fred GebhartThere’s a new game in travel management. It’s called SmartTrip, and the prize – for both travelers and employers – is about as simple as prizes get: Money. Save $100 on the next business trip, and split the savings between traveler and company.
Runzheimer International is testing a hosted software application that puts money in business travelers’ pockets – giving them a personal, practical incentive to cut their own travel spending.
The new travel management tool may be the first of its kind. Where most travel programs warn of sanctions and personal pain from violating travel policy, SmartTrip rewards travelers for doing the right thing.
Turning travel management into a game, or gamification, isn’t new. Companies have been using leader boards, contests and other kinds of games to encourage employees to compete in cutting costs or boosting compliance for some time now.
But the game has always been competing against fellow travelers or other work groups within the company. And for travelers the competition has been about fun – not cash rewards.
Shows benchmarks to employees
Here’s how it works.
Travelers enter basic details for a trip, including the city or cities to be visited and travel dates. Runzheimer uses its travel spend benchmarks, based on years of client spending data, to estimate how much the trip should cost for air, hotel, ground transportation and meals.
The benchmarks can be adjusted to account for company travel policy, such as using advance-purchase economy air and three-star or lower hotels and per diems.
SmartTrip loads the traveler’s favorite travel sites, starting with the company’s preferred sites. Then it gets out of the way.
The traveler can shop and book anywhere.
Earning a payout
After the trip is over, SmartTrip compares the actual cost to the estimated cost. If the actual is less than the estimate, the savings are credited to an online account. If the total cost exceeds the estimate, the overage is subtracted from the online account.
Travelers set savings goals and track their online balances. They also get to choose when to take a payout.
The payout can be as flexible as the employer wants – options include gift cards, points toward upgrades on future travel, cash split between company and traveler. The more the traveler saves, the more he or she takes home.
As travel management consultant Scott Gillespie blogged earlier this week, SmartTrip solves the problem of motivating travelers to save on travel costs with a simple equation: “Good Trip Budgeting + Traveler Self-Interest = Shared Savings.”
Empowers employees
“Our mission is to enhance employee mobility and optimize your mobile workforce,” Matt DeWolf, Runzheimer’s director for new product development, told Travel Market Report.
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“We have the historical data, the benchmarks, so we can empower travelers to make smart decisions when they buy travel. And we can make it fun; we can make it a win-win for the company and for the traveler.”
“Our original hypothesis is that this would be most attractive to companies that don’t have a tightly managed travel product,” DeWolf said.
Runzheimer has been using SmartTrip internally since late 2011. Employees love the payoff, and Runzheimer loves the savings, according to DeWolf.
Potential obstacles
But sharing cost savings with travelers is a radical departure for many companies. So is inviting travelers to shop and buy anywhere.
“We have talked to some large companies and there are two sticking points,” said Joseph Boscher, Runzheimer’s new product development manager. “One is the duty of care responsibility. They want to know where travelers are at all times.
“The other issue is the impact on existing volume discounts and negotiated contracts. My question back is how effective are those contracts if travelers are beating your negotiated rates? If your travelers can beat those contracts, you should encourage it, because it means you are saving money.”
Useful information
Gillespie noted a few other reasons to like SmartTrip. Creating estimates for each trip gives travelers a company-specific and trip-specific cost that they know is considered appropriate. That’s information they don’t currently have.
The tool turns a spotlight on just how well each traveler performs against a benchmark. That’s information many travel managers don’t currently have without running exception reports.
It lets managers compare actual spend to a meaningful benchmark that reflects real-world travel patterns, not an ideal. That can be an effective way to demonstrate to senior management the benefits that travel management brings.
Tweaking the product
For now, SmartTrip is still in beta, but Runzheimer wants to expand the beta audience.
Some gaps are already being addressed.
In Version 1.0, SmartTrip provides traveler location information based only on the itinerary information the traveler initially entered. Now Runzheimer is developing a phone-based app to provide more precise location information to resolve duty of care questions.
“This is just the first generation. People will ask for the tools they want and need to use it more effectively, and the product will grow and expand,” DeWolf said.
