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Business Travel Coalition Poll

Today in Chicago a group of corporate travel managers, TMC executives and other concerned industry participants will meet to discuss the Air Canada Tango controversy. I will report on the gathering in tomorrow’s blog. One subject we will most certainly discuss are the results of a recent Poll regarding steps individual travel agents and travel managers are taking in the marketplace to communicate their displeasure with Air Canada’s actions. Those results follow.

Between June 25 and June 30, 2006 the Business Travel Coalition conducted a poll of travel agents and travel managers to determine what steps are being taken in the marketplace to communicate to Air Canada the industry’s dissatisfaction with the airline’s removal of its Tango fares from the GDSs. Twenty-one corporate travel managers and twenty-four travel agents participated in the poll.

Poll Results

I. I have taken the following independent steps to register my dissatisfaction with treatment by Air Canada: (all that apply)

31 (22%)  Investigated alternative airlines.                                                            
31 (31%)  Stopped using / selling AC whenever alternatives exist.                         
18 (13%)  Voiced concerns to my AC representative.       
24 (17%)  Asked my industry Association to defend my company’s interest.                      
23 (16%)  Was a Signatory to an industry letter to AC.                                                      
  9   (6%)  Attended / listened over the Internet to the ACTA / BTC Toronto conference.       
3    (2%)  Contacted elected officials / regulators.                                                            
1    (1%)  Wrote a letter to my local newspaper. 

COMMENTS

• I will only book AC only when it is absolutely necessary; I book United as they have almost the same choice.

• WestJet loves Travel Agents!

• I would love to tell my AC representative, if I ever saw him/her!

• As far as I can see the sooner we can do without AC the better. They continually cause disruption and controversy. My clients do not want to use them if there is any other option.

• Dealing with the staff as they are so miserable to both clients and agents is terrible; the less I have to do with them the better. When we do call it is like we are interrupting them and they have no concern regarding the clients or the agents. They cannot be bothered. This has come through loud and clear. Until I see an attitude adjustment I will do whatever I can to encourage my clients and everyone else to not use AC. So put the fares back or not I am done with them. I am tired of being abused by them and dealing with the unhappy clients that have the misfortune to have to fly with them.

• We do not do volunteer work for any airline; only if there is no alternative do we sell zero-commission services.

II. Since May 3, my organization independently moved business away from AC in the approximate amount of:

28 (80%)  $1,000 to $100,000 (Canadian dollars)
  5 (15%)  $101,000 to $200,000
  2   (6%)  $201,000 to $300,000            

COMMENTS

• We reduced our domestic traffic on Air Canada by 42%.

• I am not sure of amount, but AC is almost becoming irrelevant in my office.

• We are a small agency but if you look at percentage, and not dollars, you can see I have moved as much as possible away from them.

III. Other steps my organization has taken:

COMMENTS

• Weekly conversations with my TMC regarding fragmentation costs.

• Increased the use of web meetings because our strict internal company policy requires that employees book their travel through a designated agency so we can locate them in the event of an emergency. We have reiterated to all travelers that they are not to use the AC Website directly.

• We now must allow travelers to bypass the newly installed self-booking tool and this increases the transaction cost to our company because they now secure travel arrangements with our preferred agency.

• To offset some of these increased expenses caused by the Air Canada action, we have cut back on some travel.

• Opted with lower fares with competitors such as WestJet in Canada and on trans border routes.

• Investigated web scraping for on-line reservations; encouraged Agency to participate/communicate on our behalf.

• I try not to sell AC in other markets as well, e.g., international destinations.

• Held a conference call for all clients. Prepared a template of a letter for our clients to send AC directly.

• Encouraged use of online tool that can search ac.com. Encouraged agency partner to offer online search capability through their process.

• Posted a sign regretfully informing our customers that we have been banned from the least expensive fares by Air Canada and that they will have to book AC themselves. (Very regretfully since many clients have no access to the web or do not have a credit card.)

• I book WestJet, CanJet, United, US Airways; anybody but AC when possible.

• Other than reducing our sales to AC to show our dissatisfaction we as an organization have no other option.

• We do not offer Tango fares to customers, ever.

• We have been telling clients what Air Canada did and what the effect may be on them.

• I am not selling them so I need no other steps.

Air Tight in the Windy City or Defining Full Content Once and For All

In my last couple of posts I've talked about the need for air-tight commitments from the airlines to full content and protection from discrimination.  Corporations provide too much high-yield business to airlines to be given anything less than an air-tight commitment to full content.  And corporations shouldn't be discriminated against for the GDS they choose; it should be your choice, particularly because of the value you bring the airlines.  (As one corporate travel manager said yesterday here at the NBTA Convention in Chicago, "It's a lot easier to switch airlines than GDSs.")

I was drafted onto a panel today in the “Nobody’s Content With Content” session to represent corporate travel departments when a panelist could not attend. It was lively and all the threshold questions came up. The “F” word, fragmentation, and concerns about it, was raised by members of the audience and the panel alike. It was clear travel managers want serious commitments to full content through their GDS.

But what do we mean when we say "air-tight commitments to full content" and "no discrimination?"

Full content means exactly that: everything.  It's all fares made available for purchase by the general public at any reservations outlet:

• Published fares -- from any channel that are broadly available/published

• Web fares -- whether the airlines or an online agency

• Promotional fares

• Private fares

We've heard about airlines wanting to keep the right to send promotional offers to "targeted groups" of their travelers.  If it's not well-defined, a "targeted group" could mean "only their frequent flyers," which of course is tens of millions of people, and probably a great percentage of your travelers.  (See my previous posting about what happens to your travel program when airlines are allowed to make offers you can't make to your travelers.)

Then there's non-discriminatory access.  You shouldn't be discriminated against because of the GDS you use. You should have non-discriminatory
access to all private/unpublished fares including:                                 

--bulk fares
--consolidator fares
--corporate negotiated discounts
--group fares
--meeting and convention fares
--net fares

It's important that we get this right.  Everyone should be asking their
GDS and their airlines about this.  Will you get access to truly full
content, or will there be holes in the promise?  Will you be
discriminated against because of who you do business with?

The answers should be unequivocal.

Air Canada Needs to Restore Tango Fares to GDSs

Republished with permission from The Beat.

By: Christiane Théberge, Vice-President, Public Affairs, Association of Canadian Travel Agencies; Lyell Farquharson, Spokesperson, Canadian Corporate Travel Association; Kevin Mitchell, Chairman, Business Travel Coalition

Reacting to the outcry against its heavy-handed, surprise decision to withdraw access to its Tango fares, Air Canada has taken a step back to restore a connection with professional travel agents who sell 70% of its tickets.  Air Canada has announced the return of Tango fares to the Air Canada agency web portal with a credulity-straining proclamation that the airline’s “concern has always been the agencies’ access to content in an environment they can work in.”   We’re glad Air Canada is finally talking, but travel professionals are right to maintain their skepticism of the nation's dominant airline. The real opportunity for Air Canada to achieve alignment with its air travel distribution partners, and corporate customers, is to return Tango fares to the Global Distribution Systems (GDSs) without delay.   

An airline serious about developing a good working environment for travel agents would in fact do well to talk to travel agents. Travel agents are still waiting for the phone to ring. This leads us to ask if consultation is a long-term priority for Air Canada. Most Canadian travel agents would tell Air Canada that the web portal is a woefully inadequate place to do business, just as it is for agents in the U.S. and elsewhere in the world. Yes, we’re glad that Tango fares are available through this relatively inefficient channel, but if Air Canada’s leaders are expecting hearts and roses from the agency and corporate travel manager communities, they should be seated while they’re waiting. 

Travel professionals do not want to be forced to navigate unique supplier websites in order to serve their customers when a far more welcoming and efficient distribution platform exists – namely, the GDS. In the U.S., the National Commission to Ensure Consumer Information and Choice in the Airline Industry in 2002 studied this issue in depth and concluded in its final report to the President and Congress that web portals, among other things, do not allow agents to control the passenger record, to serve as a value-added travel manager, to work quickly and efficiently, to consolidate financial records and to keep all passenger profiles in one place. The report concluded that “the lack of integrated information imposes costs on agents, both for separate search equipment and in the extra time required to perform the searches. These costs will ultimately be reflected in service charges to consumers.”

Marc Rosenberg, Air Canada’s distribution head, tells us that Canadian agents have a different model than those who work in the U.S. He says that Canadian agents who are used to booking low cost carriers have been programmed differently to embrace and accept the Internet where their American cousins have resisted. He says that Canadian agents looking for data in one single source have been able to accomplish that by acquisition of third-party software. Here’s the truth Mr. Rosenberg: from a travel agency perspective, web portals just don’t cut it, including Air Canada’s. They create the need for expensive and inefficient workarounds. They distract travel agents from giving their customers optimal service.   

The history of travel distribution boils down to three essential, related themes: competition, content and control. Dominant airlines like Air Canada appear to believe that if they can withhold access to fare content from distributors, they can seize control of passengers by forcing them into the company store. To this we say: “Air Canada, many customers resent this treatment.” Business and leisure travelers alike say “no thanks” to being deprived of personalized, streamlined, value-added service that facilitates travel shopping and buying – the sort that comes from a travel agent automated by a GDS. Air Canada should back up its rhetoric about concern for travel agents’ working environment with good faith action – instead of a small step, it should take all the necessary steps to restore Tango fares to the GDS so that we can all focus on what’s important: serving our end-customers the best way we know how.

In the Eye of the Storm?

As I attended today’s “Perfect Storm” panel discussion here at the NBTA convention, I couldn’t help but think about how appropriate that title was.  While many people here are saying that the recent airline and GDS announcements signal eventual calm waters ahead (even if they are costlier calm waters), I fear that the calm some are feeling is only the eye of the storm.

In fact, I’ve become even more convinced in the last 24 hours – talking with people here – that American clearly has demanded loopholes in its GDS contracts.  This makes the yet-to-be-completed negotiations between American and Sabre all the more critical. And it means that corporate travel managers must act to ensure they don’t find themselves in the storm of a fragmented marketplace once again. Questions and comments from the floor of the “Perfect Storm” session underscored the disbelief travel buyers feel that their airline partners would knowingly heap extra fragmentation, complexity and costs upon them.

Why is fragmentation a bad thing for corporate travel managers?  It comes down to the three C’s: Credibility, Control and Costs.

If airlines are able to offer fares and send special promotions to travelers – including your corporate travelers – and those offers aren’t available through the corporate travel program, the program loses its Credibility.  The recent action by Air Canada, pulling its lowest fares out of GDSs, is hurting corporate travel programs north of the border.  It’s this kind of action that I trust Sabre is trying to fend off in its negotiations with American.

With your program’s Credibility eroding, travelers feel justified in – in fact they feel good about – “saving their company money” by using other means to secure lower fares.  That cuts into your ability to Control a corporate travel program.  What was an integrated program – with clear insight into what suppliers are doing and where travelers are going – is now fragmented and unmanageable.  You no longer know all of your travelers who are in a location when terror strikes or a tunnel implodes.

And ironically, those travelers trying to “save the company money” by using outside channels are now driving higher Costs.  They have hurt your ability to negotiate with suppliers.  You have less leverage because the travel spend through your program is less.  And now the airlines can extract exactly what they want: higher prices – in the form of reduced discounts.

Alternatively, if you try to build work-arounds and other tools to bring these offers into your system, or capture these out-of-system bookings, you’ve also increased your Costs.

We need to avoid this storm.  We need to take advantage of our access to airlines and GDSs this week to make absolutely sure they know where we stand.  We won’t stand for another fragmented marketplace, with no Credibility, no Control and higher Costs.   We expect that full content means full content…that protection from discrimination means real protection.