Business Travel

Concur survey sees travel spend rise

Concur, the global leader in providing integrated cloud-based travel and expense management services released its third annual global report on corporate travel and entertainment (T&E) spend. The report analyzes more than $50 billion in corporate travel and entertainment (T&E) spend. Leveraging expense data generated by its more than 18,000 corporate clients, this report provides businesses and travel managers with unique insight to help inform their travel and expense programs, enabling organizations to make more informed decisions.

The spend data was analyzed for nine nations worldwide, including the United States, United Kingdom, Canada, France, Germany, Hong Kong, Japan, Australia and India. To augment the analysis, Concur asked IDC, the premier global market intelligence firm, to give additional insight on the data. Their insights provide important context for the numbers, to give an even more complete picture of the global T&E environment.

India data
India’s data threw up some interesting facts based on the analysis. The rupee declined 12.4% against the dollar from 2011 to 2012. Accounting for this change in exchange rates, we can see that India saw an 18% increase in the average airfare transaction, which is the highest recorded increase globally. Rail costs also increased greatly – nearly 58%, which is the highest recorded increase across the US, UK, Canada, France, Germany, Hong Kong, Japan and Australia.  Surprisingly, the average gas transaction declined 4.2% suggesting that rising fuel costs were not the only factor behind the higher airfare and rail amounts

Bangalore once again emerged as the most visited city in India for business travel ranked at no. 12 in the 25 most visited cities followed by Mumbai ranked at 20 in terms of number of overnight hotel stays. Bangalore dropped from rank 11 in 2011 to 12 in 2012 with the average spend also dropping from around $258 to around $227 for categories of lodging, ground transport, dining, entertainment. On the other hand Mumbai maintained its position at rank 20, however, total average spend dropped from approx. $255 to approx. $238. However, in terms of average transaction amount, Bangalore stood last at no. 25 with $227.83 and Mumbai at no. 23 with $238.37. The above average transaction amount has fallen in 2012 as compared to 2011 for both cities with Bangalore declining from $258.7 in 2011 to $227.83 in 2012 and Mumbai declining from $255.18 in 2011 to $238.37 – it is important to note here that though the spending in dollar terms has declined, the actual spending in rupees may have actually increased owing to the 12.4% decline of the rupee in the said period. 

The average percentage spend on lodging (31%) was the highest in India as compared to other APAC countries like Japan (23%), Hong Kong (25%) and Australia (14%). India ranked the lowest in average entertainment spend at 2.44% and the highest being 8.14% in Japan

Key APAC Region Highlights:
·         India is the only APAC country to show a decline in spends on lodging at -0.27%, though percentage spent on lodging remains the highest in India compared to other spend categories
·         India saw most significant rise in airfare for APAC at 18% but average transaction cost remains the lowest in the region
·         Dining in India saw a minimal rise whereas all other counties in APAC saw a decline in spends
·         India and Hong Kong are only 2 countries that saw a rise in entertainment expenses
·         India saw a significant rise in railway expenses at 58% as compared to other APAC countries. This rise is the highest among all nations in the report – both at the regional and global level.
·         Telecom grew significantly at 24.45% in Hong Kong as compared to other APAC countries

Other key findings from the report include:
·         In 2012, the average expense report filer spent $3,244 per quarter on T&E
·         Concur found spending in almost all expense types declined at least slightly, including dining (-11.1 percent), car rental (-9.1 percent), and airfare (-8.2 percent); hotel spending dropped the least (-3.8 percent)
·         Hotel spending accounted for the highest share (24 percent) of all international spend, while airfare expenses accounted for the highest share of all U.S. spend
·         The most expensive international city for business travel was Brisbane, Australia, followed by Tokyo, Japan and Sydney, Australia

Christopher Juneau, Senior Director, Marketing, APAC, Concur Technologies said; “Through this report we aim to help our customers in understanding and organizing their employee spends accurately.  The report is a study of travel and entertainment spend across important business hubs of the world including Australia, Canada, France, Germany, Hong Kong, India, Japan, United Kingdom and the United States. As we see an increasing interest by companies in automating their travel request to enforce travel policy prior to booking, Concur gives access to Low Cost Carrier (LCC) content that helps in driving the airfare lower.”

The Concur Expense IQ Report also finds corporate travelers spent 93 percent more on ancillary fees in 2012 ($58 million) than they did in 2011 ($30 million) – challenging companies with nearly twice as much hidden or low-visibility spend.

He further added, “Ancillary fees are a relatively new area of spend that many organizations are still not capturing accurately, however, Concur Expense enables clients to categorize and capture these specific categories with increased granularity, enabling them to truly understand all the costs involved in air travel. The total for this area of spend captured by Concur clients increased from just over $30 million to about $58 million from 2011 to 2012, with only “Onboard Entertainment” seeing a marked decline and “Seats/Upgrades” remaining relatively flat.”

“The fact that ancillary spending nearly doubled from 2011 to 2012 reflects two key facts: customers are using automated tools to more accurately track their ancillary spending, while airlines, hotels and other providers have gotten more savvy about componentizing their services to collect more cash in a down market,” explained Robert Mahowald, VP of Cloud Services at IDC.

Desire for Mobile Expense Reports Growing
Mobile devices were also found to be a growing aspect of companies’ expense management processes as logins to the Concur mobile expense app more than tripled from 2011 to 2012. The study found nearly 73 percent of these logins were via Apple iOS, while Android (14.6 percent) and Blackberry (12.7 percent) were also popular.

“We’ve seen great momentum around Concur’s mobile application this past year among businesses of all sizes,” Juneau said. “Understanding that travel is inherently mobile, it’s easy to see how using a tool that moves with business travelers wherever they go increases productivity – whether it’s billable work or something more administrative like managing expenses.”


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