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The Myth of Online Adoption

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The Myth of Online Adoption

The Myth of Online Adoption 1

The myth of online adoption ( ), by which I mean the use of online booking tools for travel reservations, is that increasing adoption rates alone will not, and may not benefit your bottom line. Rather, today’s travel 2 manager must also increase touchless rates ( ) in order to drive down costs and compete in a changing environment. Simply put, you want to prevent your agents having to ever work a PNR created online. I work with many travel management companies (TMC’s) across the country and internationally and have found they all fit into one of two groups: 1. those who have adopted technology and 2. those who have not Studies have show that those companies who adopt technology, and use it to its maximum potential will spend about 30% less time to produce a reservation and will realize savings of 8.5% or higher. Most TMC’s sign up for online booking tools because: • • •

A customer threatens to move to another TMC or to an online travel agency (OTA) They need to be compete with large TMC’s and OTA’s to avoid losing business It's the latest “Buzz Word”

Or, they say they have a tool but don’t (or perhaps have a basic tool) and pray that customers never ask to use it. In order to determine the Financial Reward for utilizing an online booking tool you need to know: • • • •

Your cost per transaction What is the right tool to meet your customers needs What is the right tool to meet your agency needs The pricing difference.

You also have to consider what I refer to as Pricing “101” questions: • • • •

Are you charging a flat fee for all online bookings? Can you charge based on the touch points? How do you sell to your customer? How do you deliver on what you have sold?

Ways to Increase Touchless Rates Before you can use an online booking tool successfully, you must understand what the tool can and cannot do for you? I recommend you treat booking tools like a new agent. Set them up like you would train a new agent. Develop a booking template, and stick to it! Require users to select reason codes. Have your users pick the exception reason. Don’t always give in to your vendor. And, challenge the “Status Quo”.

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The Myth of Online Adoption

To increase your touchless rates, you need to set up your “Mid Office” automation (an example is Cornerstone’s iQCX) to work the PNR’s first. DO NOT let your travel agents work the PNR first. Only send the PNR to an agent when the PNR has to be modified or has to be actioned. Be specific and tell your agents what action they need to take. Review the actions your agents taking with PNR’s created online, and MAP out what that work entails. Then, ask yourself: • •

How can these actions be automated? How can these actions be eliminated?

Use you mid-office automation to validate that information is correct and look for missing information such as: • • • • • •

Job Codes Cost Center Codes MIS Information (LF,HF,SORT/UDID) Ticketing information Statement information Airline programs (Mid Market, Commissions etc)

Again, whenever possible, have your mid-office automation add or fix this information before resorting to having your agents do so. If the PNR does requires agent intervention, have your mid-office automation change the fee schedule prior to sending the PNR to an agent. Do not rely on your agents to change the pricing indicator. Use an auto-ticketing application (an example is Cornerstone’s iQCX Ticketing) to ensure that you are truly driving touchless transactions and billing your customers correctly. Make sure you have a way to measure your online adoption and touchless rates. In order to do so you may need one or more of the following: • • • •

A separate DK/CA number UDID/Sort Some kind of “OR”, or “Market” code Assign the task of monitoring “Peaks and Valleys”

Track your results. Report on touch levels. Develop metrics that show your customers the value that moving to online and moving touchless brings. • • • • •

Track why customers are calling and help your customers drive down calls Establish customer profiles and show how they perform What is your average, “Adoption Rate”? What is your average “Touchless rate”? What is your average “Call to Booking Ratio”?

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The Myth of Online Adoption Add value to your service offering such as non-refundable ticket tracking and usage. Don’t rely on the booking tool to create client solutions. Develop them via mid-office automation and don’t be afraid to charge for these services. Use mid-office automation to send travelers email links that allow them to check in online. Include weather and non-refundable reminders. Send out emails that give local value (e.g. airport parking vouchers, discounts at local stores for being your customer). Final words of wisdom: • • •

Don’t be afraid of technology Never say, “no that can not be done” (automated) Always offer “Online” as another booking channel

Celebrate your success and your Metric's.

About Cornerstone Information Systems What if you could do double the work in half the time? This is what Cornerstone Information Systems accomplishes for their customers by handling the technology side of business so their customers can focus all their attention on their core competencies with the passion and drive that leads to success. As a leading professional services company, Cornerstone helps travel management companies, corporate travel departments, airline and global distribution systems work to their fullest and most profitable potential. Founded in 1992, Cornerstone Information Systems is a privately-held company based in Bloomington, Indiana with offices in eight locations worldwide.

Author Contact Information James Dargan Email: jdargan@ciswired.com Phone: +1 (812) 330-4361 ext. 7654 Cornerstone Information Systems 304 West Kirkwood Avenue Bloomington, IN USA 47404 http://www.ciswired.com

Copyright © 2008 Cornerstone Information Systems. All rights reserved. Page 4 of 5 Contents are exclusive property of Cornerstone Information Systems. Contents not to be copied or distributed without written permission from Cornerstone Information Systems.


The Myth of Online Adoption

1

Adoption Rate = Compares the total transactions to overall use of on-line booking methods to traditional travel booking methods. Example: Total Transactions 60,000 Traditional Booking 47,875/60,000 = 79.79% On-Line Booking 12,125/60,000 = 20.21% Various claims exist around corporate customers adoption rates Get There 45% (52% = 2008) Expedia 50% (GTD in 50 Days) Large Regional’s 8 - 45% PhoCus Wright research shows the average US corporate travel online will be 52% by 2008 2

Touchless Transaction Rate = The Percent of transactions that are made via an on-line booking tool that are processed with out any Travel Agent intervention. Various claims exist around corporate customers Touchless Rate: Get There 46% Expedia 50% American Express 92% Large Regional 70% - 85%

Copyright Š 2008 Cornerstone Information Systems. All rights reserved. Page 5 of 5 Contents are exclusive property of Cornerstone Information Systems. Contents not to be copied or distributed without written permission from Cornerstone Information Systems.


Myth Of The Online Adoption