Home / TRAVEL / Business Trip or Vacation? Travel Start-Ups Try to Blur the Line – New York Times

Business Trip or Vacation? Travel Start-Ups Try to Blur the Line – New York Times

Upside officially started in January, and more than 10,000 companies in the United States are already using it to book employee travel, according to its founder, Jay Walker. TripActions, which began offering its services in 2015, does not disclose its user figures but has attracted companies like Survey Monkey and eHarmony, said its founder and chief executive, Ariel Cohen. Rocketrip, which has been around since 2013, is the preferred booking tool of General Electric, Twitter and 50 to 100 other Fortune 100 and midsize businesses, Dan Ruch, its founder and chief executive, said.

Mr. Ruch, of Manhattan, got into the business of offering incentives to business travelers after learning about how Google employees travel.

“I came up with the concept in 2012, but it wasn’t really my idea,” he said. “We stumbled onto Google’s approach,” which has been in place at least a decade. The Google method includes drawing up a budget for airfare and hotels before every trip. If employees come in under budget, they earn credits that can be redeemed for travel upgrades in the future. The approach is different from “gamified” booking tools that encourage certain behavior, like using a preferred carrier, but generally do not let employees share in the savings.

Rocketrip, like Google, allows travelers to keep half of what they save. Instead of travel upgrades, it offers gift cards to Amazon, Best Buy and other retailers through a so-called rewards store.

Mr. Ruch calls the system “incentivized behavioral change,” and he said it was either the most radical concept in corporate travel, or the most obvious.

“There’s such an enormous amount of inefficiency in business travel,” he said. “If your company’s policy allows business class on flights over six hours, it is not expected behavior to fly coach. If your policy allows five-star hotels, it is not expected behavior to stay at a three-star hotel or to stay with a friend.”

People are naturally drawn to comfort, Mr. Ruch said, meaning that unless they know they will be rewarded for cutting corners, they will indulge their inclination to make business travel as cushy, and as expensive, as possible.

Mark Mintman, the director of finance at AAF International, an air filter company in Louisville, Ky., said he had seen Mr. Ruch’s theory in action. Before AAF started using Rocketrip last fall, the company’s roughly 100 traveling employees submitted trip budgets to management before booking.

Photo

The Quin hotel in Manhattan. Business trips booked through a new breed of online travel companies can yield benefits for travelers and their employers.

Credit
Hilary Swift for The New York Times

“There was really no incentive to save,” he said. Once Rocketrip and its “Budget to Beat” formulas were adopted, Mr. Mintman said, AAF employees started to save the company 15 to 20 percent, or roughly $133, per trip. Travelers see how much they can earn for each cost-saving option — staying with a friend instead of staying at a hotel, for example — through Rocketrip’s online booking tool.

“I’ve seen some extreme examples of people getting into it,” Mr. Mintman said. Colleagues who once stayed at a Hilton are now staying at the less expensive Microtel. And, he added, “I’ve had guys stay in hotels 45 minutes away from where they need to be, just to generate savings. Instead of being loyal to a Starwood or a Marriott account, now they’re loyal to saving the company money.”

Rocketrip, like other start-ups applying a carrot-and-stick approach to travel, also gives reports to company managers about how much was saved and which action — settling, say, for a cheaper hotel or a coach seat — caused the savings on each trip, Mr. Ruch said. If an employee goes over the “budget to beat” figure, management sees that, too.

Mr. Mintman said that working with Rocketrip had helped AAF determine what was reasonable for a travel budget. “Now, we can go back to someone’s proposed spending on a trip and see how well it lines up with what Rocketrip has come up with,” he said.

TripActions, which gives users who save their companies money “TripBucks” redeemable for gift cards, upgrades and vacations, claims it can cut travel costs as much as 30 percent per trip. (Mr. Ruch said the average Rocketrip user saves the company 24 percent).

The TripActions app lets users specify airplane seat preferences, loyalty club memberships and other personal details before booking. It also allows for last-minute itinerary changes and features a chat line, should complications arise.

David Rowley, vice president of customer experience at Jive Communications, a tech company in Utah, likes TripActions’ emphasis on customer service.

“I’m leaving for a trip on Monday, so I know I’ll get a call from them on Sunday afternoon letting me know my flights are still on schedule,” he said. He also likes the TripBucks, which accrue the more you travel and the more you save. Mr. Rowley said he had earned $1,700 in rewards and had saved Jive $7,500 since the company started using TripActions at the end of last year. He cashes in his TripBucks for Amazon gift cards.

“My daughter is getting married, so I’m using TripBucks to buy things for her wedding,” he said. “Honestly, I’ve learned from using TripActions that travel really is a behavioral thing. I used to wait until the last minute if I needed to go somewhere. Like, I’d book my tickets late so I could get into a certain hotel. But now I book months in advance because I’m looking to save some money and earn some rewards.”

Upside, a third venture developed with the goal of getting business travelers to think like consumers, bypasses travel managers and works directly with employees.

“We target any company that doesn’t have a travel department,” said Mr. Walker, who was also the founder of Priceline. “Essentially, if your company asks you to buy your own travel, we’re there for you.”

Savings are generated by bundling flights and hotels. Upside buys the flight and hotel packages at wholesale prices, then sells them to customers at what Mr. Walker called a “lower retail.” Rates, he said, were usually 5 to 10 percent off rates at sites like Expedia, and users earn gift cards every time they book a trip. The average card earned for a domestic trip is $100 to $200. (Participating retailers include Amazon and Home Depot.) Values run higher, usually around $200, for international travelers. Companies typically save 5 to 15 percent when employees book through Upside, Mr. Walker said.

Kurt Hosna, global communications director at a Boston human resources management company, said he had used Upside since it started. So far, he has redeemed roughly $1,000 in rewards, much of it for gear for his cycling hobby.

Before he and his colleagues started using Upside, Mr. Hosna said, they tried to be good sports about not overspending on travel. His company’s pat-on-the-back approach to acknowledging their conscientiousness was nice, he said. But Upside’s gift cards have been nicer. “Giving people real rewards just makes sense,” he said.

Continue reading the main story

Business Trip or Vacation? Travel Start-Ups Try to Blur the Line – New York Times

About admin

Check Also

Inspector general reviewing requests to probe HHS Secretary Tom Price’s private jet travel – ABC News

The inspector general’s office at the Department of Health and Human Services is reviewing requests …

Leave a Reply

Your email address will not be published. Required fields are marked *