source: epicgraphic.com

Looking for some fresh thinking on the travel KPI front?  Help is at hand!

Four of us took up Paul Tilstone‘s challenge to create a set of Key Performance Indicators for travel category managers.  Nicolas Borel, Torsten Kriedt, James Westgarth and I have been working on this project for quite a few months now.

We settled on twenty-one KPIs, complete with definitions and likely data sources.  Of course, you can’t have a KPI Toolkit without an Excel file, right?  So we designed an easy self-scoring worksheet that allows you to customize the weights of each KPI to suit your interests. Our KPIs focus on transient travel – the groups and meetings side was out of scope from the get-go.

Folks, these KPIs are suggestions – they are not industry-agreed standards.  They are meant as a thoughtful starting point for considering which KPIs are best for your travel program.

We’ll unveil the KPI Toolkit on this webinar hosted by GBTA Europe.  It starts at 1430 GMT on 30 January.  To register for this free event, please e-mail Katharine Blakemore at katharine.blakemore@gbta.org.  GBTA members will have access to the KPI Toolkit via the GBTA website.

On a related note, here’s a post on the pitfalls of using KPIs.

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Here’s a handy recap of the most popular articles from the last year or so:

Travel Booking Tool Goes Gaming   SERKO applies gamification to its self-booking tool, to great success. See this post for the original idea.

Verbal Translation via iPhone  Covers a pre-Siri method of translating speech from one language to another.  See this post for a related view on voice-based flight search.

Direct Connect by Google – Oh Yes  Implications of Google’s Flight Search on the distribution of airfares, especially for corporations.

AirPlus Gets an A+ on Ancillary Fees Report   A product review of a tool aimed at quantifying how much a company spends on ancillary fees.

Short’s BookIt: A Brilliant Booking Breakthrough   Describes the most innovative idea I’ve seen in the corporate self-booking arena.  See this post for more implications.

TIILTS: Better Travel Data Reporting   What’s wrong with today’s travel data reporting tools, and what’s needed.  In a word, prescriptive.

New Types of Hotel Rates Ahead   Predicts the emergence of rates more similar to airfares – non-refundable and dynamically priced.  See this post for the rationale.

An Open Approach to Travel Distribution?   Uses a clever video to illustrate the advantages of open systems and the implications for travel distribution.

Four Barriers to Travel Innovation   Explains why there has been so little innovation, with a capital I, in the managed travel space lately.

Free Tools   Includes the Stages of Excellence for Managed Travel toolkit, category-specific travel savings “What If” models, an airline CO2 calculator and fuel cost model,  and popular education decks.

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Procurement folks hate undiscounted spend.  They’ll love ProcureApp.  Why? Because it detects when a buyer (think traveler) has wandered onto a non-approved supplier’s website. When that happens, a friendly message pops up.

“Pardon me, old chap.  Couldn’t help noticing that you’re on Brand.com’s site.  Not really an approved supplier, are they?  Tsk, tsk. Why don’t we take a nice stroll over to our approved travel site, and do our shopping and booking over there, shall we?”

Beautiful.  A timely message displayed to a traveler at a critical step in the path of non-compliance. Complete with a link to the preferred site.

Not loving the affected British slant?  No problem, old chap – you can customize the message’s text to your liking (The British example is my doing, not ProcureApp’s.)

Maybe you prefer “Book here and you’re fired.”  Oh, come on – I know a few of you would want that one.

Messaging is not limited to cases where a traveler lands on  Brand.com’s home page.  ProcureApp can deliver customized messaging and preferred links, and even insert corporate purchasing codes – at just about any point in the shopping/booking process.

On a car rental site: “I say, would you mind if I inserted our company ID here?  We’ll get  a better price, you know. And do be a good lad and decline all the insurance options.”

Phil Hammer, the force behind ProcureApp, sees wide potential for helping buyers/travelers do the right thing.  It’s point of process messaging designed to re-direct behavior.  ”We’re still discovering new ways that procurement managers want to deploy this”, he says.  Some buyers are keen to simply track non-compliant purchases; others want active diversion as far upstream as possible.

There is precedent for this technique in the travel industry.  Heather Young, travel manager at Capital One, gave a presentation at a GBTA event last summer in which she described a similar home-grown method.   “It’s very effective, and very easy to implement”, she said, if memory serves.

Clever messaging at key points in the procurement process.  Jolly good show, that!

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Jeff Kurn, one of HP’s travel management rock stars and good friend, is looking to fill these four spots on his new Travel Strategy and Consulting team.  All positions are virtual; no relo required.

Travel Business Consultant (684829): Provide trusted-advisor travel consulting to HP’s businesses and finance organizations.  The Business Consultant will need to present compelling action-oriented opportunities for reducing costs and increasing traveler productivity.

Travel Supplier Development Manager (684833): Develop and expand 360 degree relationships with HP’s travel suppliers and travel industry customers.  The Supplier Development Manager will utilize HP’s Tier 1 Supplier Development processes to design and implement increased savings, revenue enhancement and traveler productivity opportunities with our travel suppliers.

Travel Business Controls Manager (684831): Develop and support strong business controls across the global HP Travel organization.  The Business Controls manager will work with the travel agency, corporate card provider and other suppliers to ensure that all operations comply with HP’s business and financial controls.

Travel Business Intelligence Manager (684835): Build and maintain actionable industry intelligence and benchmarking reporting.  This business intelligence specialist will also support the requirements of the HP Travel procurement organization and HP Sales.

To find more information about these jobs and requirements, visit www.hp.com/go/jobs, click on “Search Jobs” and enter the job numbers listed above.  You can read more about the direction Jeff has in mind for his team here.

You can contact Jeff at jeff.kurn@hp.com.  If you do, be sure to say nice things about graduates of Central High.

Book It makes the “Shop anywhere, but book it here” concept practical for corporate travelers.

Travelers can use any website to find an itinerary and fare they like, then send that flight info to Short’s via e-mail.

The Book It system looks up the traveler’s corporate profile, presents relevant travel policies, applies the corporate discount, and with 3 clicks from the traveler, books the flight.

This “Shop anywhere, but book it here” model is incredibly powerful.  It eliminates a huge chunk of traveler objections to using a corporate self-booking tool.

Let’s think about some fascinating implications:

Corporate Self-Booking Tools (CBTs) don’t need to invest in, and charge for, sophisticated search and shop functionality. The Book It model co-opts every OTA and supplier.com site’s investment in search/shop by conceding those functions to the players who do that best.

So we should see lighter-weight CBTs, ones that are open to the Book It model of “shop anywhere, but book it here”. And self-booking fees should go down, yes?

What about travel policies and preferred supplier pricing?  How will a company apply those before a ticket is issued?

Start with the idea that travel policies are crude attempts to help travelers determine what the best value is.  The concept of lowest logical fare is Exhibit A. It’s a clunky framework for guiding a traveler’s choice.

We need a much smarter way to define value.  Enter the Travel Value Engine.

The Travel Value Engine will use these types of factors to propose a few itineraries and fares to the traveler:

• The traveler’s preferences, which comes from the itinerary selected in the “shop anywhere” step;
• The corporate travel policies about cabin class, connections, etc.;
• Preferred supplier pricing, perks and volume or share goals;
• Availability of unused tickets;
• Duty of care considerations;
• Attribute-based weightings, such as Fastest, Cheapest, Nicest, Most Compliant, etc., similar to what Rearden’s Deem does;
• Social and gaming factors that influence the traveler’s choice of itinerary, such as what Serko offers in its SBT.

Done well, the Travel Value Engine offers a few attractive itineraries and fares.  The traveler selects one and sends it to the light-weight booking tool. The ticket is issued, the data is captured, and the TMC stands by, ready to serve the traveler.

This makes the Travel Value Engine the first, and by far the most important place to influence business traveler behavior.  Travel managers will need value engines that are really good at accounting for the factors mentioned above.

That strikes me as a fairly complex task.  I suspect a few very focused suppliers will solve the problem.  We’ll see travel value engines that are potentially independent of booking tools, TMCs and GDSs.

Travel value engine suppliers will compete on doing the best job of figuring out relevant choices for the buyer’s travelers. They’ll charge for their smarts, and they’ll figure out insightful new ways to measure their results.

Imagine that – achieving 100% adoption of your corporate booking tool, capturing all that data, and having a value engine that effectively influences desired traveler behavior. That’s the kind of travel innovation I’d like to see.

(Hat tip to CWT’s  William El Kaim for his comments on this topic here.)

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Book It** allows a corporate traveler to search for airfares on any site, then e-mail the selected flight info to Short’s for booking and en-route servicing. Completely automated. Fast results.  Pure genius.

Why pure genius?  Because, according to
David LeCompte, Short’s president, some two-thirds of corporate travelers are shopping for their airfares on non-corporate websites anyway. Once they find a good flight, they have to re-enter the details into their corporate tool.  Newsflash – not every traveler bothers with that last step.

Then there’s the small problem that consumer OTAs are investing millions of dollars in their flight search capabilities and user interfaces.  Tough to compete in that arena, agreed?

In a flash of inspiration, LeCompte saw the solution – let travelers use the sites they love for shopping, and let Short’s use the results to book the flight. Just “share” or e-mail the selected itinerary to “bookit@shortstravel.com”.  Easy as can be.

Before my travel manager friends turn purple at the thought of this out-of-policy enablement – relax…Short’s designed Book It specifically for corporate programs. So long as the traveler uses his/her corporate e-mail address and has a corporate profile, Book It will

• Apply the relevant corporate discounts – and show the traveler the amount of savings achieved;
• Present corporate travel policies before booking;
• Track unused tickets; and
• Include the ticketed spend in corporate data reporting.

Book It also plays nice with mobile bookings. Users can shop on their favorite mobile app, and send the results to Book It.  Book It works by re-shopping the flight info on Apollo, so it returns any result that is in that GDS.

Short’s charges a self-booking fee for handling the automated booking/ticketing, and provides agent services to travelers needing en-route assistance.  Exactly as if the traveler had shopped on the buyer’s self-booking tool.

Book It is in its early days.  It works best on simple itineraries, and doesn’t yet handle hotels. It does, however, offer additional similar flights if fares are lower or the journey time is faster than the itin sent in by the traveler.

David LeCompte, Kristi Lamont and the team at Short’s get an A+ for jui jitsuing the tendency of business travelers to shop first – and often only – on leisure OTAs.

I can’t think of a better example of producing a traveler-centric solution for managed travel programs. Nor can I wait to see what Short’s comes up with next.

Meanwhile, the implications of this innovation from Iowa are potentially profound.  Look for a post on this soon. Update: Here’s that new post.

* See Short’s 2010 innovation “CouldYou” here

** The official name is “Bookit@shortstravel.com”

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Hipmunk is focusing on de-cluttering the results of a traditional travel search.  It integrates air and Amtrak rail options into flight searches, and combines hotels with AirBnB results. Hotels are presented with geo-heat maps to highlight shopping, dining and vice (really). Beautifully done.

Evature says hooey on traditional travel search – too many point and clicks, radio buttons, sliders, etc.  Solution?  Semantic search, aka free (unformatted) text.  ”Summer beach vacation for about $600 per person”  Think about how time-consuming that search is in today’s OTA world.  Same for business – typing  ”Day trip to Chicago next Tuesday” has to be easier than getting those parameters into a self-booking tool.  And yes, Evature accepts speech, just like Siri.

So Hipmunk is simplifying the structured travel search process, while Evature is handling the complexity of simple travel searches. A fascinating contrast in travel innovation.  Who will win?

My prediction: Free text/free speech trumps structured search.  Speaking is easier than typing, especially in a mobile world.  Imagine a corporate booking tool that uses Evature or Siri-based search capability.  That will be a true next-generation breakthrough in the self-booking space.

I wonder who will be the first to bring speech-based search to the corporate travel market?

(Update: The day after this post, Evature was named as the grand winner by judges at the Travel Innovation Summit)

Watch the full set of travel innovation presentations by registering for free here: http://pcwi.phocuswright.com/PC11-online-ticket.html\

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Do you see the implications for managed travel?

It’s all about power from the bottom up. Compliance gets you nowhere.  Stop questioning the status quo and do something dramatic.  Create a cause. Organize.  Apply pressure to the weak links in the logic chain.

Revolution is in the air. And on the ground, and in the hotel room.  It’s literally at everyone’s fingertips in the form of a mobile phone.  Big change in managed travel is coming, folks. Quickly? No. Inevitably? Yes.

BTN Group’s recent survey confirmed the gaps between travelers and travel buyers on the travel policy front.  No surprise, the youngest travelers are the least aware of and least likely to comply with policy.

It’s a two-part problem.  Communication and motivation.  Young travelers aren’t getting the message. When they do, the message doesn’t make sense.  It doesn’t speak to their values.  There’s no WIIFM factor (What’s In It For Me). Or more accurately, What’s In It For Us – us being the cohort of the Millennials, the socially conscious, the socially connected, the technically savvy.

If travel managers are policy czars, then travelers are the subjects – and the subjects are getting restless.  There’s a growing vacuum of understanding the rationale for managing travel.  The old ways are fair game for fresh questioning.

As it should be.  The question is, what’s the answer?

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Does Distribution Really Matter? Can it Differentiate Airline Products?

Absolutely.  Think about how the endpoint of the distribution chain looks today.  You still see flight times, carrier logos and prices.  Pretty commodity-like stuff, that.  From green screen GDS terminals to mobile booking displays,  all you see is a long list of racked-and-stacked flight options.

It’s the equivalent of shopping in the paper towel aisle at WalMart. Price dominates.

Enter Curation, Visualization and Personalization

It doesn’t – and shouldn’t – have to be that way.  Inside Trip and Hipmunk get it.  They use the non-price attributes of flights to eliminate the clutter.  Rearden goes one step further.  It sorts flight options into persona-based groups. One for the low-cost traveler, one for the in-policy traveler, one for the get me there quick gal, and one for the guy wanting a good in-flight experience…much more tailored – the basis of differentiation.

American Gets It – On the Leisure Side, Anyway

American is leading the charge for distributing differentiated products.  Bravo!  It’s a bold move, and one badly needed by the commoditized airline industry. American’s senior management talks of its vision to build customized offerings around the base airfare, similar to how consumers choose to upgrade a laptop to their personal specs. Perfect – more customization means better marketplace fit and more ways to create value for the buyer and seller.

But Where’s the Corporate Value Prop?

American’s comments about the value of creating customized offerings for travelers at the point of sale don’t yet make sense to the travel procurement community.

Remember that Carlson Wagonlit went on record saying it would charge customers extra to shop and book American’s products unless those products were in the GDS (the equivalent of stocking airfares in the paper towel aisle at WalMart).

As I said in Beijing, American has done a Grade A crap job at explaining the value of this strategy to the corporate travel community. So the gatekeepers of corporate travel spend are left wondering about the value proposition of American’s pursuit of differentiation.   It’s not that they won’t pay more for a better product, it’s that they don’t yet have any reason to believe there is any value to the corporate buyer.  To the corporate traveler, maybe – but to the buyer?

The Path Forward

Conceptually, there are a lot of inputs that an airline could use to create customized offers for business travelers.

The trick is to do this in a way that creates value for not just the traveler, but also for her company.

Much easier said than done, as far as I can tell.  Part of the problem is the current GDS technology, which doesn’t have all the merchandising features sought by the airlines.  It’s also a commercial problem; one that may well be the more important of these two.  But ultimately, I think it is a question of value to the corporate buyer.  The good old WIIFM factor – What’s In It For Me?

My Advice to American and the Other Airlines

Quickly build the business case for differentiated products for the corporate travel community. Help us understand the WIIFM factor for each of the stakeholders. Don’t let this discussion get dominated by the GDSs and TMCs.

Innovation and differentiation are good for the travel industry.  It’s a long road ahead. Help us realize that you’re not selling a box of shoes, but a journey.

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You may think Google Flight Search is just another meta search tool.  I think it is a major step in a campaign to build direct connections between airlines and travelers. Google Flight Search is GDS Bypass personified.

Google sees the GDSs as fortresses, producing hundreds of millions of captive airline searches beyond the reach of any search engine. Searches that need to be freed. Searches that should have the right to be completed directly with the supplier. Searches that in their basic form can be served up quite nicely with Google Flight Search.

But the campaign is far from over.  Airline products are evolving rapidly.  Complexity is increasing. The successful search platforms have to keep up.  Direct Connect, or its technical equivalent, has to be part of the solution.

Why?  Because the airlines will eventually win their battle to merchandise their products the way they want.  All they need is the technical platform and the marketing muscle.

The technical platform is not the issue.  Between the high-IQ boys and girls at Google, ITA and FareLogix, that problem is classified as either solvable or solved. It’s the marketing muscle that’s the real issue.

And Google just threw its marketing muscle squarely behind the airlines.

Will we see advanced boarding fees and day passes sold next to airfares in Google Flight Search?  Maybe not soon, but surely those are coming.  It’s too hard to see how airfares can be shopped without taking those into account.  My money is on Google being a big part of that solution.

Here’s Google’s explanation of Flight Search: