This article from NYTimes.com has been sent to you by psa188@xxxxxxxxx /-------------------- advertisement -----------------------\ Explore more of Starbucks at Starbucks.com. http://www.starbucks.com/default.asp?ci=1015 \----------------------------------------------------------/ Online Booking Cuts Costs and Simplifies Trips September 2, 2003 By SUSAN STELLIN In the digital dark ages, employees who needed to book a business trip would either call a travel agent or fill out a company form with their itinerary and wait for an envelope to show up on their desk with their tickets and other documents. The process might have required several phone calls back and forth - say, to check a seat assignment or request a nonsmoking room, or perhaps modify a single-city trip to include a sales call in a second city. But just as technology has revolutionized the way leisure travel is booked and sold, it is just as significantly changing the way corporate travelers make airline reservations, book hotel rooms and arrange for car rentals. Although some organizations still rely on paper forms and phone calls for most of their travel planning, a growing number of businesses, large and small, are adopting online tools to automate the process and cut costs. "For simple trips, the traveler doesn't need a travel priest anymore to decipher mysterious code," said Henry Harteveldt, an analyst who follows the travel industry for Forrester Research in San Francisco. Businesses, he says, are going online to book flights and hotel rooms for the same reasons ordinary Americans do to plan vacations. "It helps save money," Mr. Harteveldt said. "And it lets the traveler take control." Online booking for business trips is just getting off the ground, by Forrester's estimate, accounting for $13 billion of the roughly $150 billion that companies spent last year on travel. But Forrester expects that amount to more than double by 2007, to $27 billion. That creates what Mr. Harteveldt described as an "enormous upside in this segment," and a big opportunity for Internet travel agencies. In the last year, the three largest - Orbitz, Expedia and most recently Travelocity - have created online booking tools aimed at the corporate market. Orbitz for Business, Expedia Corporate Travel and Travelocity Business are essentially souped-up versions of the companies' public Web sites, customized to incorporate a client's travel policies (for example "no five-star hotels") as well as any special rates it has negotiated with travel suppliers. Employees log on and search for flights, rental cars and hotels much as they would plan a weekend getaway to London. The difference is that certain flights or hotels show up in the results as preferred, based on whatever policies or rates the company has fed into the software. "You get a slightly different version of Orbitz," the company's president and chief executive, Jeffrey G. Katz, said. "If your company has negotiated air fares, for example, they show up in your display. The look and feel is very similar." The tools also generate detailed financial information to help travel managers get the best possible deal. Travelocity's reports, for example, enable companies "to fully understand how they're spending their money, what they're saving and what they're losing if they allow their employees to book outside of policy," the president of Travelocity Business, Ellen Keszler, said. It is not just finding the best air fares or hotel deals that saves money for companies. The online travel agencies promote their own low fees, which are generally a fraction of the $25 to $45 a reservation that the traditional agencies have been charging corporate clients since the airlines reduced, then eliminated the commissions they paid. Expedia, Travelocity and Orbitz typically charge $5 a reservation booked online and $10 to $20 for reservations that require help from an agent on the phone. In some cases, there are additional fees to change a reservation, set up a company account or upload the rates a company has negotiated with airlines. Those fees vary slightly - for instance, Travelocity and Orbitz are waiving setup fees for their service - but are generally comparable. The old-line travel agencies are not standing idly by as the online purveyors enter their turf. In fact, American Express, the largest, has been serving the corporate market with online tools for years. American Express's Corporate Travel Online booking engine, designed for large companies, allows for more complex customization. A client, for example, can set different booking policies for top managers versus rank-and-file employees or service multinational corporations with offices in many countries. The company also offers a service called RezPort aimed at small businesses that do not have elaborate travel policies or their own negotiated rates with vendors. More sophisticated online tools can generally be integrated with a company's expense report software and programmed to alert its travel managers about an employee's booking plans. Tony D'Astolfo, a senior vice president with GetThere, a company whose booking tool is used by more than 1,000 companies, said the system could be configured to send a message to an employee saying, "That $2,000 air fare you're taking - I want you to go back and take that $1,000 air fare." That is one way online tools can keep costs down. Another is what Mr. D'Astolfo and others call "visual guilt," or the impulse that overcomes some employees to take advantage of bargains that they spot on their computer screens but probably would not have learned about on the phone. GetThere is owned by the Sabre Holding Company, which also owns Travelocity, and focuses on large clients while Travelocity aims at small to medium-size businesses. (GetThere's technology is also used for some of American Express's online products.) Expedia and Orbitz say they are marketing to any size company, but by most accounts, small to medium-size companies are the most contested market. Even some airlines are developing online booking tools aimed at businesses that do not need much hand holding. Southwest Airlines, for instance, has had a separate Web site for corporate booking since May 2000 and is one of the first carriers to focus on business travelers with a dedicated online product. But as Mr. Harteveldt, the Forrester analyst, pointed out, it is still early in the game, and just as leisure travel booking services have become much more sophisticated in the last year, corporate booking tools have room to grow. "The story isn't what's happening today; this is evolving," he said. "In a year I think we'll see very different products." http://www.nytimes.com/2003/09/02/business/02BOOK.html?ex=1063510444&ei=1&en=e5d789a84926ae8e --------------------------------- Get Home Delivery of The New York Times Newspaper. Imagine reading The New York Times any time & anywhere you like! Leisurely catch up on events & expand your horizons. Enjoy now for 50% off Home Delivery! 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