How can I maintain visibility into my travel program if I let my employees book direct with suppliers?

There’s one word that haunts, and potentially hurts, every managed travel program: “leakage.”

Direct bookings, made by employees with the vendors, whether on an airline website, a third-party option like Expedia, or walking right up to a car rental counter, circumvent the purpose of managed travel. The company does not have the key information on those direct bookings for duty of care purposes, and savings are negatively impacted. The savings impact can occur twofold, with the direct loss of a discount available through the travel program and with the lowering of volume, when vendor contracts and year over year negotiations tend to be volume-driven. These direct bookings can also open up an organization to fraud – whether intentional or not.

Yet at times it can feel as though the corporate travel program is competing with vendors’ own push to book direct: free Wi-Fi, extra points, and other incentives are increasingly common to encourage travelers to book right with the vendor. While the vendors’ intention is to combat third-party booking options, these incentives can have the unintended effect of driving travelers away from a managed travel program… particularly when travelers feel as if they are saving money by going direct or find a discount through a thirty-party option. Travelers who use or prefer industry disruptors like AirBnB in their personal lives may look to use them for business, either within or going outside the constraints of their travel policy.

Booking Through Managed Channels During a Pandemic

While we may hope, given the COVID-19 pandemic, more travelers would come to understand duty of care’s value and inherently comply with booking through managed channels, we cannot count on such a change. While compliance may have increased after 9/11, new mobile technology and other conveniences offered by vendor direct bookings drew travelers back toward leakage. Additionally, given vendor strategy, this period may be the first time in history where the statement “I can find it cheaper online” starts to take on more accuracy. Coupled with the continued decrease in corporate travelers’ average age of and corresponding rise of increasingly tech-savvy, independent personalities in business travel, leakage is unlikely to fade so easily or without a fight.

How companies approach leakage often comes down to company culture. The most effective way to rein in leakage is also the harshest. If leakage (and travel risk) is policed strictly per travel policy, and bookings outside the travel policy are denied reimbursement, travelers are more likely to comply—at the cost of burdening your travelers with a perhaps costly learning mistake. Take this “stick” approach and organizations are at risk to lose top talent in ever-competitive employment landscapes.  For companies who decide a more flexible travel policy is better suited to their culture and employee satisfaction, aside from the potential loss in savings, the major concern becomes how to maintain an appropriate level of duty of care.

One Solution is to Source Leakage Data from Expense Tools

However, this solution often creates another problem, as it can push the issue over to another department and leakage data from expense tools can be spotty, as well as an onerous to monitor. How viable monitoring leakage via expense is varies greatly by company and is dependent how clear, coherent, and well-managed expense data is; even in the best-case scenario, whenever traveler self-reporting is involved, the data is likely to be difficult to normalize. One hotel name, for example, could appear in the data in fifteen different ways or merely by its brand name, rather than narrower identifiers.

Shep Travel, a Chrome browser plug-in which captures travel bookings, offers another solution option and has partnered with travel management companies to make its technology available. Via Chrome extension, Shep overlays data and guidance and captures bookings, on whatever site individual travelers make them. However, again, company culture can be a deciding factor here. Shep can catch issues upfront, by advising travelers when spending more than they should or sending alerts to manager, but the overt Big Brother element of an active browser plug-in overlaying on online travel agencies and airline websites may not be suitable for all bookers, nor would it catch mobile bookings or those done through alternative browsers.

A less intrusive option, Traxo offers a data-integration service that sends travelers’ itineraries to your preferred travel management services, including risk management applications. However, Traxo’s non-intrusive approach does mean Traxo’s integration relies on emails manually forwarded to a designated address. This aspect either requires your company’s IT team or email administrator to determine which emails are sent to Traxo or asks for user behavior to change, in terms of forwarding any direct bookings themselves. As inability to change user behavior tends to be the sticking point of leakage, relying on travelers to go the extra step in self-reporting, even simply, leaves room for leakage to continue.

CapTrav: A Better Solution to Track Corporate Travel Spend

KesselRun’s own recommended solution, marking the first time KesselRun has partnered with a third-party, is CapTrav, as a bridge between letting travelers book directly and reining them in: CapTrav works in the background, rather than as an overlay, on an email basis. Any confirmation bookings sent to an email domain running CapTrav will be captured and can then normalized so as to be be reportable. Whether needed for duty of care or to share volume inclusive of leakage with vendors and, ideally, reclaim lost savings, leakage data is then captured without needing to impact, or force change to, traveler behaviors.  CapTrav can provide all of the detailed data required to have meaningful and potentially profitable conversations with vendor partners – and most importantly, identify the location of all of your travelers in near-real time, inclusive of Uber, Lyft, and other non-TMC booked channels.

However you choose to approach leakage, as with a physical leak, you can only ignore it so long. We recommend dealing with this “invisible” volume before, rather than when, a problem arises, particularly with duty of care at the forefront of minds for any near-future travel. For any further questions on how you can address leakage, contact KesselRun.