Have you stopped to think about what goes into corporate travel? How large it is? Who is traveling most? What travelers do and don’t like about it? We trolled the internet to round up the latest and greatest statistics about corporate travel. Let’s take a good look inside the corporate travel industry by the numbers!
How Big is Corporate Travel?
Corporate Travel is a trillion-dollar industry! The U.S. and China are the world’s biggest business travel spenders.
Americans make more than 405 million long-distance business trips per year. This means about 1.1 million people are traveling for business every day in the U.S. The Big Apple – New York City – is the most common business travel destination, though the fastest growing business travel destination is Shanghai.
Business passengers represent 75 percent of an airline’s profits despite only being 12% of their total passengers. But the money is well spent: every $1.00 spent on business travel creates $15 of profit for increased sales.
Business Traveler Preferences
How are business travelers booking their travel? We know that 79% of corporate travelers used their mobile phones to complete bookings through on online booking tool last year.
Whoever thought that one day we’d be booking flights from the palms of our hands? But, from 2016-2017, the number of people who booked travel plans solely from their mobile devices rose a whopping 70%. Plus, over 23% of all business flights are booked outside of standard business hours these days. That tells us that not only are business men and women using their phones to book travel, they’re doing so outside the office.
Sadly, 23% of business travelers wait until the week before departure to book domestic trips, which decreases policy compliance especially because rates increase dramatically the closer you get to your travel date. Flights wind up costing more than policy allows and exceeds company budgets!
Alas, technology cannot replace connecting in person. Nearly 70% of business travelers agree it is difficult to build business relationships over video and 91% agree they’d rather close a deal in person. Thus, the infamous “business trip” shall go on.
For most business travelers, their frustration begins with booking the trip. 83% of business people said it takes more than an hour to book a business trip. But, booking travel is not their biggest pain point.
When they travel, what is the biggest concern for business people? The #1 corporate travel concern by airplane passengers is flight delays. The second concern? A middle seat!
Where is the money going?
Would you believe it if I told you that the majority of companies’ travel budgets is spent on meals? Corporate Travelers expense up to 3 billion dollars in fast food every year!
The next 17% of a corporate travel budget is spent on flights, 13% on hotels, and the remaining 49% is spent on everything from tolls to gas and miscellaneous expenses.
What do you think is the #1 most important factor for business people booking hotel accommodations? Nope, not price! It’s proximity. The location of a hotel close to the meeting destination is the most important factor for corporate travelers when deciding where they want to lodge. This can also cost the company more money since paying for location tends to be higher.
What’s the Deal with Travel Policy?
Despite the massive amount of employees who travel for business, only 60% of companies have a corporate travel policy in place for employees to follow. Of corporations that do have a policy, most employees report that they do comply with it. In fact, a Travelport study reported that 69% of business travelers say they “always comply with policy”.
We think that number is a bit optimistic, otherwise travel managers would not struggle so much to meet their budgets. In a separate study by Amadeus, only 50% of travelers said they followed company policy. What’s more troubling is that in this same study, 60% of business travelers admitted they don’t even understand their company’s travel policy.
Speaking of travel managers, when asked if they feel confident that they could locate traveling employees in a crisis within two hours, only half agreed that they could. Moreover, only 8% of travelers reported that their travel agent proactively reaches out when plans unexpectedly change.
Even though the average age of a corporate traveler is 45 years, millennials are impacting corporate travel in significant ways. First, they’re spending more time on the road when they do travel. The average business traveler takes around 6.8 trips a year, but millennials average 7.4 trips per year.
Apparently, the younger members of the workforce aren’t complaining about having to travel for work. Most of them consider business travel to be a perk of the job, and 65% of them see it as a status symbol.
Millennials have boujee preferences too. They are 60% more likely to upgrade for more legroom on flights than non-millennials. Further, 21% of millennials do not belong to any loyalty program and are less interested in loyalty programs in general. Too much commitment. Though they are game to ride-share with services like Uber so in some small way they’re saving the company cents.
The most significant impact by millennials on corporate travel has been the increase in “Bleisure” trips that have increased over 20% in recent years and continues to rise.
The Future of Business Travel
The outlook for global travel spending is expected to reach $1.7 trillion dollars by 2022. While current global trade tensions are suspected to slow international business travel slightly, it will continue to rise overall.
Business travelers are changing, and business travel tools are evolving with them. Today’s business traveler wants a seamless experience with flexible choices and dynamic business policies. Trondent can help your corporation achieve this experience and save time and money for both traveler and the company.