Case study: The power of corporate travel benchmarking

The power of corporate travel benchmarking

Forward-thinking travel program managers are proactive and don’t sit in a vacuum. They understand the importance of having their ear on the ground internally and externally to stay ahead of change and trends.

Benchmarking is a part of that strategy. It’s an exercise that is an independent review and assesses how your corporate travel program is performing compared to others. You can benchmark a specific element such as: 

  • Air program: Negotiated rates, ancillaries, T&Cs, cancellation terms, benefits, carbon footprint, traveller wellbeing

  • Hotel program: Negotiated rates, ancillaries, T&Cs, cancellation terms, benefits, carbon footprint, traveller wellbeing

  • Travel policy and online booking tool: Average cost of trip, booking lead time, flexibility/inflexibility, compliance, adoption, usage, climate impact

Why benchmarking is important 

Benchmarking is never a stand-alone activity; it should be part of your wider business strategy. In today's business environment, if you aren't running benchmarking exercises, you run the risk of your travel program not being competitive or you may make travel decisions that aren't backed by relevant data.  

If you are not able to measure how your program is faring, your prices might be too high. Which then affects compliance, if your travellers start looking for cheaper flights and hotels elsewhere on the internet. Additionally, you need this comparison and validation to underpin your travel program strategy. It tells the story of your performance to internal stakeholders and brings confidence to your forward action plan.

Where to start with benchmarking

“There are several places to start with standard benchmarking, such as trade press and business travel trade associations,” advises Jo Lloyd, Global Head of Account Management and FCM Consulting. “These tools give you a basic level of understanding of how your travel program compares.”

Travel program managers using FCM already have additional benchmarking data to hand. Using the FCM Platform’s reporting dashboards, they can view benchmarking data for hotels and airfares based on booking habits across all our clients. They can easily compare how much they’re paying for hotels and flights over a designated period. 

For a fuller investigation and to really understand your programme performance, you need to engage a specialist.

When to involve an expert navigator

For a fuller investigation and to really understand your program performance, you need to engage a specialist. A benchmarking exercise can answer burning questions such as:  

  • Are we getting a good enough discount from supplier/s?  

  • What are the gaps and where should we be paying attention to?  

  • Is our policy too generous or too rigid?  

  • Can I take this to management to elevate the value of my role and the travel program? 

As each program is so different, it can be difficult to get a statistical change, but the exercise still generates value. You can also download these stories here.

Here are some of the ways our experts at FCM Consulting have conducted benchmarking exercises.

Manufacturer's hotel programme

Manufacturer's hotel program

Brief: A manufacturer client wanted to validate whether they had the best negotiated rates in its corporate hotel program.

Analysis: Hotel program lead Rachel Newns analyzed the company’s top 10 visited cities over a six-month period. She analyzed the number of hotel room nights, average paid for a room and volume traded through FCM globally.

Outcome: Rachel gave the client confidence to make the best decisions in their hotel program. Through the benchmark analysis, Rachel not only confirmed that some rates were performing at market level, but she also identified anomalies. This helped the client focus on what hotels they needed to renegotiate with, and to define what ‘consistent’ looks like to them moving ahead. Context is hugely important. With her expertise and hotel contacts, Rachel navigated the data to not only inform the client but educate suppliers too.
Air programme diagnostic

Air program diagnostic

Brief: Similarly to hotel programs, benchmarking air fares is typically part of a wider air program strategy. One objective could be to understand how much a change in travel policy could cost an organization. An FCM Platform feature allows this comparison, but it’s the bigger benchmarking exercise that really delivers the value.

Analysis: While it is difficult to compare apples with apples, our FCM Consulting experts compare and benchmark data points such as how far in advance bookings are made and length of stay. Using FCM Consulting’s smart ACiQ tool, they can overlay the client’s contract data with travel data in one display to weigh up the differences and compare airlines.

Outcome: Validation and value. After analysis and recommendations, the client had the information they need to move forward with any changes to the travel policy, have the data to share internally to prove it, or can reignite conversations with airlines.
For a fuller investigation and to really understand your programme performance, you need to engage a specialist.

FMCG company’s travel policy

Brief: An FMCG client wanted to benchmark its travel policy against others. One objective was to understand how flexible/inflexible their travel policy was, and whether they were being generous enough (or not) with business class allowance.

Analysis: Project lead Juan Antonio Iglesias, Director of FCM Consulting EMEA compared the client’s policy against the policy of a similar company, a business in a different industry, and an outlier. Using his insider knowledge and expertise, Juan analyzed aspects of the policy against the others to compare and benchmark, for example, whether the policies allowed business class flights for journeys longer than four hours or six hours.

Outcome: Juan made recommendations to the client based on the benchmark exercise, with two angles. Firstly, cost control, suggesting ways the travel policy could be tightened or loosened to avoid incurring additional costs. Employee retention was the other, ensuring the policy is competitive and not so restrictive that employees would be put off.

With a blend of cutting-edge data capture, smart tools and decades of experience, travel managers can move forward with confidence in their program performance and keep ahead of change.

 

View more ways the FCM Platform can help travel managers have technology stacked in their favor. 
 

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