2019 Corporate Travel and One Card Benchmark Survey Reports
Dr. Mahendra Gupta and Dr. Richard Palmer (both at Washington University in St. Louis)
Market Trends and Best Practices (Report 1)
North American travel card spending continued its pattern of steady growth, growing at an annual average rate of 4.0% in the past three years, growth that was driven by robust economic growth in 2017 and 2018. Current travel card spending in North America is $216 billion, up from $192 billion at the close of 2015, and we estimate that spending will grow to between $238 and $259 billion by 2023, at an average annual growth rate between 2.0% and 3.7%, with some variation across market segments. Our analysis also estimates that overall travel card spending in the U.S. and Canada has the potential to grow to $386 billion if organizations began using their travel cards to full potential for their travel spending.
These statistics are some of many findings reported in the 2019 Corporate Travel and One Card Benchmark Survey Results (“2019 Results”) recently released by RPMG Research Corporation. The 2019 Results are based on responses from over 1,300 travel card-using organizations that were customers of one of the forty major U.S. or Canadian card issuers including members of the National Association of Purchasing Card Professionals or the National Institute of Governmental Purchasing.
The business travel world is changing quickly, though in subtle ways. First, survey results indicate that 10% of respondents currently allow and another 17% plan to allow “bleisure” travel (i.e., combining business and leisure as with a weekend stayover after an out-of-town trip) over the next three years as a way to recruit and maintain employee talent. Such a shift will have significant implications for travel card users, their organizations, issuers, and the travel industry writ large.
We also find the sharing economy gaining significant traction in the business travel, with large increases in use of ride and lodge-sharing services over the past three years. Additionally, many large corporations have established “business accounts” with sharing economy service providers.
Further, we find the highest level of travel card distribution across the employee base in the past decade of travel card survey data gathering.
Technology is ever-evolving and its impact on business travel cannot be ignored. Survey data sheds new light on utilization of mobile devices, virtual travel cards, mobile wallets, virtual meeting capabilities, and AI-driven expense management, all of which will alter the business travel process significantly and often in ways not fully understood at present.
Of particular note, the 2019 Results found that 35% of organizations expect an increase in the proportion of meetings held “virtually” over the next 3 years, which is likely to cause a decrease in travel spending. In fact, we find that organizations that are shifting toward more virtual meetings are over five times more likely to expect decreases in their travel budget than organizations planning no such shift.
Opportunities and Improvement Potential
The 2019 Results reveal that there is great potential for growth for a large segment of the market. Many “best practice” (high-performing) travel card programs, have taken specific steps to extract the maximum value from their travel card. Other organizations can learn from these programs and follow similar steps to improve their own travel card program.
Best practice programs report higher average monthly spending per card, higher monthly travel card spending, and greater average annual growth in travel card spending. These programs are also associated with higher capture of travel spending on the travel card, a higher level of financial incentives from the card issuer, higher discounts from airlines, hotels, and auto rental agencies using card data in vendor negotiations, greater use of travel card features, and higher capture of card value at enhancing the financial position of the organization, increasing employee-traveler convenience, increasing the transparency of spending, and strengthening control over spending.
While the majority of respondents to the 2019 Survey did not have a card misuse incident in the past year, such events are not uncommon. The most common travel card misuse is a “policy violation.” Organizations should take special care to institute policies that are meaningful and necessary, while making sure employees are aware of and understand them. The 2019 Results highlights a variety of control options that respondents are using to prevent misuse from occurring, to detect it early, and to take corrective measures so that misuse, once it has happened, does not happen again.
The Results also highlight common “pain points” experienced by travel card-using organizations, with guidance for improvement.
Special sections of the 2019 Results explore other market trends, including travel card spending norms, changes in travel booking practices, liability agreements, card value creation and card features, the use of travel cards outside of North America, the impact of changes in tax law, and much more.
In addition to the Market Trends and Best Practices Report, three companion studies are derived from the 2019 Survey data, including:
Benchmark Data for Travel Card Use and Management (Report 2)
Benchmark data to evaluate card program success for multiple market segments, including corporations (by size and industry), states and state agencies, cities and counties, colleges and universities, school districts, and not-for-profit organizations.
One Card Use and Best Practice (Report 3)
Spending norms and factors critical to the success of the one card platform, and The unique value of the one card concept and emerging technologies and trends influencing the growth of one card use.
The Provider's Role in Travel Card Program Success (Report 4)
Customer satisfaction with and importance of travel card provider activities (across economic, service and support, technology, program management, reporting, and data integration factors) and their influence on travel card program performance.
A complete copy of the 2019 Corporate Travel and One Card Benchmark Survey Results can be obtained by clicking the "Add to Cart" button on the side of the page. Other inquiries related to the Results may be directed to Richard Palmer at Richard.Palmer@rpmgresearch.net.