Travel managers allow employees to share in the savings they generate
Employers are starting to employ gaming techniques from the consumer world and to delve into the psychology of decision-making to persuade their travellers to do the right thing and save money.
Changing traveller behaviour is undoubtedly a challenge. Get it wrong and it could demotivate an entire workforce or send them to a rival company. But get it right and changed traveller behaviour could impact directly on a company’s bottom line.
The news of tentative economic growth is having no impact on corporations relaxing travel budgets; rather, the tactics and strategies learned over the last few years are here to stay for the foreseeable future.
This poses challenges for any Travel Manager needing to make additional savings on an annual travel budget already shaved to the bone. They have used various means to stretch budgets as much as they can: consolidating the number of suppliers, switching market share, downgrading class of travel, avoiding travel altogether perhaps, buying the lowest logical fares, or booking all point to point travel online. The challenge is, where do they look next?
Several travel suppliers in the business have come to the rescue with new ideas and concepts for squeezing more out of a budget, most of them predicated on changing traveller behaviour.
Getting travellers to do the right thing, which means to book through the right channels, book only the preferred travel suppliers and book in the right category of hotel or class of flight, will improve travel policy compliance and therefore create incremental cost savings.
Gone are the days when employers penalised bad behaviour by refusing to pay expenses. Today’s trend is to reward good behaviour through incentives and rewards, something that has been dubbed gamification.
Borrowing from consumer game cards and scorecards, gamification turns booking activity into a game-based experience in order to improve compliance to the company travel policy.
The Solutions Group of global travel management company CWT, for example, has launched Travel Gamification.
”Rewards – even virtual ones – positively reinforce compliant behaviour, encourage engagement and build loyalty to the corporate travel programme,” says CWT. Essentially, a ‘gamified’ portal promotes light-hearted peer competition to do the right thing.
For example, if a traveller books advance air or restricted fare bookings, they receive an achievement badge. They may accumulate points for the amount of travel activity, while a leader board enables them to track performance against their peers. Virtual currency – such as points – may be earned by compliant or super compliant travellers to purchase rewards.
Such tactics will produce more loyal behaviour towards the travel policy, just as supermarket loyalty cards or airline loyalty clubs have been doing for many years.
These new ideas have been bubbling away in the industry for some time, but with little traction to date.
A year ago, another travel management company, BCD Travel, launched a white paper called The Travel Management Survival Guide, which linked a successful managed travel programme to the ability of managing travellers.
Key concepts such as Behavioural Economics were outlined as a way to influence decisions, and delved into the psychology behind how people make buying decisions.
Anchor pricing, decoy pricing, status quo bias (ie decision by default) and the stopping rule, among others, were all detailed as tactics to be employed to influence traveller behaviour.
Rocketrip, a travel management platform provider that manages travel and expenses, has come up with five ways to make employees willing participants in driving costs savings. One is to reward good behaviour.
“Allowing employees to personally share in the savings they generate can go a very, very long way,” says company CEO Dan Ruch.
“[We] enable employees to benefit first hand from the savings they’re able to realise for their employer. When there is a direct incentive tied to cost-sensitive behaviour, employees tend to go above and beyond to seek out ways to save.”
The other four ways Rocketrip recommends are to:
* Educate and help employees understand why savings matter in the first place, and how incremental savings can change the company’s financial trajectory for the better.
* Set goals that everyone can work toward – and benefit from – and that will build a team mindset and gets employees sharing best practices and motivating their colleagues to save.
* Set examples at the top. The importance of leadership as active participants in cost savings cannot be emphasised enough.
* Celebrate success. Recognise achievements, whether that means sending out company-wide emails with stories of above and beyond savings, honouring top savers at a company event, or granting special perks to the teams that make the biggest impact.
It’s early days in terms of adoption levels of these new-fangled ideas, but it’s clear that the corporate community is watching closely and that this will be the next frontier for travel managers to tackle.
The views and opinions expressed in this article are those of the author(s) and do not necessarily reflect the official policy or position of The Information Daily, its parent company or any associated businesses.
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