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Crucial Savings: Potential of $2,000 USD Per Business Trip Possible American Express ReportsAugust 20, 2009 By: George Dooley
American Express Business Travel announced the launch of eXpert insights, a new dedicated research practice within its Global Advisory Services team. Created to help companies cut the costs of business trips, eXpert insights will assist by identifying creative strategies within T&E programs and will offer best practices for implementing new strategies. Also announced were savings opportunities of $2,000 identified in the inaugural Best Practice Roadmap report “Creative Cost Savings in Air,” a key deliverable of the eXpert offer.
“As companies put a premium on intellectual capital, eXpert insights brings a much needed, creative approach that provides companies with a clear cost-savings edge,” said Hervé Sedky, vice president and general manager, American Express Business Travel.
Through eXpert insights, American Express Business Travel offers access to insights and advice backed by the industry’s largest database of travel and expense data, representing more than $100 billion in T&E spending, the collective knowledge of hundreds of consultants, and decades of travel experience. The resource is offered through an annual subscription available to companies of all sizes globally. The offering also includes access to travel management consulting provided in hourly increments for ad hoc needs, known as “eXpert on demand.”
Key findings include:
Premium Savings in Premium Economy – As many carriers introduce compelling alternatives to business class and economy coach class, eXpert insights revealed that companies implementing a premium economy policy for daytime, long-haul flights over business class can save an average of $2,000 per one-way segment in key markets. This would have resulted in more than $40M in savings in 2008 for the 30 data set companies alone. Daytime flyers likely do not require a fully reclining seat but can still enjoy the added legroom and wider seats in new premium economy offerings than those found in coach, so this policy could be implemented without sacrificing traveler comfort.
Restricting Restricted Tickets – In general, restricted fares continue to yield cost savings when compared to non-restricted fares, particularly for long-haul routes. However, eXpert insights found that on average more than one-third of selected short-haul, non-restricted tickets were actually less expensive overall when average change fees were factored in 2008. As a result, securing corporate discounts on non-restricted tickets in competitive markets can make for an attractive cost-savings strategy over the long-haul.
Quick Hit Business Trips – Providing employees with the knowledge of rate differentials and guidance to travel on the least expensive day of the week can cut costs of same-day round trip air fares significantly on average as companies look for any ways to curb the costs of business travel.