Key Drivers to Shape the Path Ahead for Global Business Travel

New Distribution Capability (NDC) marks a paradigm-shifting approach in airline retailing, access to fares

The global business travel industry continues working its way toward a forecasted $1.158 trillion in travel spending in 2023 – but economics only tell part of the story. Even as the industry gains momentum, new developments and approaches are anticipated to shape the path ahead.

For the travel industry, New Distribution Capability (NDC) marks a paradigm-shifting approach in airline retailing, access to fares, and what it means for travel buyers and the business travel landscape at large. Rebuilding the travel and hospitality industry workforce and fostering the next generation of industry professionals is also underway. And at a time when so much has changed, so has the state of the business traveler’s experience, especially when faced with disruption.

These three key drivers are explored in the Q2 2023 Business Travel Outlook Poll released today. Industry analysts surveyed over 800 business travel buyers, suppliers, and industry professionals around the world, marking the 31st poll in its long-running series.

Business travel is constantly evolving, and the latest poll highlights the top-of-mind developments and issues for the business travel industry and business travelers alike. Implementing new retailing models, rebuilding the workforce, and elevating the employee travel experience are some of the key drivers that are shaping the collective future of business travel.

Here are some of the key takeaways from this latest poll:

The Evolution of Airline Retailing

The industry weighs in on recent airline efforts to expedite NDC

• Survey respondents were asked about a U.S. airline’s announcement to travel agencies that over 40% of its content and new offerings would only be available through “modern” retailing channels including NDC. Of those surveyed, 47% say they do not support this effort to expedite NDC. A third (34%) say they did support it, and 20% aren’t familiar with NDC.

• Specific to travel buyers, 60% say they do not support the effort compared to 36% of travel suppliers and travel management companies (TMCs).

• Regionally, respondents in Europe (44%) and APAC (43%) are more likely to support the effort versus those in North America

Is NDC implementation moving too fast?

• Over half of travel buyers (53%) say some airlines are trying to roll out NDC too quickly and have not given third-party intermediaries enough time to develop the needed technology and processes.

• A third of buyers (29%) say intermediaries have had enough time and should be ready to efficiently handle and service NDC bookings.

• Travel buyers in North America (59%) are more likely than those in Europe (42%) to feel airlines are moving too fast.

• European buyers (49%) are more likely than North America buyers (23%) to feel intermediaries should be ready by now.
  Travel managers in a three-way split regarding NDC impact

• One-third (36%) of buyers say their travel program has been negatively impacted by moves from carriers overall to implement NDC, whereas 29% say it has not been impacted.

• An additional third (28%) say they are unaware of any impact, and only 6% say NDC efforts by carriers have positively impacted their travel program.

A view of the early days of NDC’s implementation

• Half of buyers (48%) say they have not yet started to implement NDC.

• Among travel buyers, a few say they have experienced some (7%) or many (7%) challenges in their NDC process, while even fewer say their transition has largely gone smoothly (3%) or without any challenges (1%).

• However, one in four buyers (25%) say it’s too early to assess how their implementation is going.

• Six in 10 buyers (61%) say they have not, nor intend to, budget for additional NDC-related servicing costs, while 23% say they haven’t done so but their budgeting process is underway.

One-third of intermediary stakeholders cite NDC implementation challenges

• Among intermediary stakeholders, including TMCs, online booking tools (OBTs), global distribution systems (GDSs), one-third (36%) say they have experienced at least “some” or “many challenges” in distributing NDC content to their corporate clients.

More engagement is needed among NDC stakeholders

• Eight in 10 travel buyers surveyed (81%) say they need more information on NDC.

• European buyers (29%) are more likely than those in North America (15%) to say they do not need more NDC information.

• Buyer sentiment is mixed when it comes to how their TMC is preparing them for NDC. Half of buyers (50%) do not feel their TMC has sufficient NDC information and/or is not sharing their plans for implementation

Rebuilding the Business Travel Workforce

Challenges in staffing cited by over half of industry respondents

• Six in 10 (58%) of all respondents report they continue to experience labor shortages and/or recruitment challenges in some capacity. However, a third (36%) say they are not experiencing significant difficulties in the areas of staffing or recruitment.

• The positions respondents say their company most need include Technology Development: 31%; Entry Level / Operations: 26%; Sales and Account Management: 24%; and Travel Consultants / Agents: 17%.

• When asked which industry sectors have the biggest staffing challenges, respondents most frequently cite hotels (59%), TMCs (43%), restaurants (37%), airports (28%), and aviation (27%).

Top barriers to building a sustainable industry workforce

• When asked to rank five of the biggest barriers facing the global business travel industry in achieving a robust, diverse, and sustainable workforce, the top selections are unattractive salary and benefits (69%); lack of qualified candidates (50%); hiring and training new professionals from outside the industry (46%); unappealing job requirements (46%); and lack of investment in retaining and talent and professional development (46%).

The Current State for Business Travelers and the Industry

Concerns and realities of the business traveler experience

• When asked to rate their recent business travel experience, most respondents say it was somewhat (31%) or very (29%) pleasant.

• However, half of those surveyed say concerns about travel disruptions – such as canceled or delayed flights, long security lines, crowded airports, or long bag check lines – has somewhat (41%) or greatly (9%) reduced their willingness to travel for work.

• Travel managers most frequently hear business traveler complaints from employees about delayed (76%) or canceled (72%) flights, long call wait times with TMCs (62%) or travel suppliers (52%), and poor hotel service quality (46%).
  The latest status of global travel spending and bookings

• Travel buyers estimate their company’s current domestic business travel bookings have returned to 72% of 2019 pre-pandemic levels (up from 67% in GBTA’s January 2023 poll.) Buyers also estimate their company’s current domestic business travel spend is 74% of 2019 levels (up from 68% in January.)

• International business travel also continues to make its return. Travel buyers estimate their international bookings have recovered to 63% (up from 54% in January), and their current spending is back to 66% (up from 58%).

Methodology: A total of 803 responses were received from across North America, Europe, Latin America, and Asia-Pacific for the poll which was fielded April 10-21, 2023.