|March 12, 2009|
American Express Business Travel Delivered $2B In 2008 T & E Savings
|American Express Business Travel has announced it helped clients globally realize more than $2 billion in travel and expense savings in 2008. Demand for proven savings and a need for greater cost control methods factored favorably in the Company's overall business performance last year, despite the uncertainty and turmoil in the economy. |
New business acquired reached $3.4 billion and global customer wins increased 172 percent compared to 2007, with a global retention rate of 98 percent1. The North America Middle-Market client segment experienced a 63 percent year-over-year growth increase, while Advisory Services achieved a 33 percent annual growth rate, globally, in consultative sales. In 2008, American Express reported $25.4 billion in travel sales.
The roster of newly-won business and renewed customers cuts across all industries and client segments, revealing a diversified global and regional base, including notable brands such as British Telecom, which decided to consolidate its program and use American Express Business Travel in Europe, Asia and the United States; and Rio Tinto, which globally consolidated its program in Australia, Europe and North America. Leading companies that expanded travel programs into additional regions include ExxonMobil in India; Commonwealth Bank in Australia; Akzo Nobel in China; and Citi, Walmart and Philips in Argentina.
"For any business leader, the first priority in times like these is immediate and substantial reduction in non-core expenses," said Charles Petruccelli, president of American Express Global Travel Services. "Of these non-core expenses, travel is one of the major items. Reviewing costs around travel and its associated infrastructure is absolutely imperative in today's environment. Whether the costs are associated with servicing, sourcing or travel management, a leader can leave no stone unturned in the quest to maximize return on its travel investments. The pressure to drive savings has signaled a new reality, and we recognize the vast changes that need to occur in the way companies approach and control business travel services."
Recently renewed client Joe Siciliano, director of Corporate Purchasing for Reader's Digest, noted: "In a challenging economy and competitive marketplace, we've found American Express to be a valuable partner in planning andmanaging our global business travel. American Express shares our view that business travel should have measurable metrics for return on investment. We appreciate American Express' high level of service, responsiveness and innovation to help us manage this important area."
As corporate travel budgets receive closer scrutiny and come under increasing pressure to yield greater bottom line savings, more clients are looking for expert assistance in redefining their existing travel programs and for advice on leveraging current conditions into an opportunity for change. In response, American Express is partnering with clients to incorporate actionable and proven solutions that generate savings, provide premium service and offer greater control over travel and expense management.
In 2009, American Express Business Travel is uncompromisingly focused, more than ever, on driving substantial benefits and savings that can be captured in clients' actual bottom lines, including:
Free Travel Program Assessment: Launched at the end of 2008, this program provided clients and non-clients of all sizes located around the world with the opportunity to identify areas for further savings, and offered advice on how to best recession-proof travel budgets. In less than four months, the program has identified more than $2.6 million in potential saving opportunities for participating mid-size companies by using proprietary methodology to analyze key indicators.
Global Advisory Services: This year, Advisory Services will concentrate efforts around key growth, productivity and compliance investments, as well as new sales acquisition and continued strong client retention. Resources will be dedicated against its Strategic Meetings Management and Planning services, and activity levels will increase to support initiatives around Eco, Policy, Hotel offerings and Change Management. Additionally, clients will have access to a library of robust research through its newly-created Research practice line.
Small Meetings Solution: This innovative solution complements Advisory Services' Strategic Meetings Management and Planning services. Targeting meetings of 50 people or less, it will deliver better visibility, control and savings to clients by automating the currently fragmented process of planning small meetings. The solution will be piloting in the United States in the second quarter.
aXiom in International: Now the online platform of choice for more than 2,000 U.S.-based customers, aXiom was successfully launched in the United Kingdom last October. Aggregating inventory from more than 137,000 suppliers, aXiom promotes employee compliance to preferred vendors and significantly increases control over unmanaged travel and related spending.
FX International Payments (FXIP) Solution: Developed for corporate clients, FXIP's online product allows companies and banks to make instant, online cross-border payments in major foreign currencies at competitive exchange rates. Highlights in 2008 included adding over 2,000 new corporate clients globally. 2009 will see FXIP launch in Canada.
BusinessTravelConneXion.com (BTX): Launched in October, this first-ever online community for the business travel industry has garnered over 3,000 registered members to date. In 2009, BTX plans to enhance its content programming, deliver an expanded subscription-based research offering from Global Advisory Services, provide new rich media and video content, and host a variety of live BTX events with industry guests.
Eco Solutions: In 2008, the Company expanded its green travel offering to include more detailed reporting and consultative services for clients, including advising on offsetting programs, carbon emission reporting, and tracking of travel activities and measuring environmental impact. The current economic environment will drive the development of environment-conscious programs. With this level of information, clients are afforded greater insight into their environmental strategies, allowing them to more accurately develop Corporate Social Responsibility tactics across all elements of their business.
Pre-Trip Approval (PTA): This automated solution gives customers the visibility and control required to manage travel spending before it happens. PTA differentiates itself in its ability to audit any field in the Passenger Name Record, has built-in logic to perform basic calculations, and offers both Approval and Notification capabilities that a customer can adjust to fit their program's changing needs. In 2009, PTA will roll out in the U.K. and Australian markets, with notification capability to be offered in a variety of key European markets.
aXis @ Work: In 2008, substantial investments were made to the user experience, providing greater flexibility through customized dashboards and more compelling information through its "What-if" analysis. Product investments enhanced overall navigation between spending, policy and supplier dashboards. In 2009, aXis @ Work plans to offer integration of new data sources, enhancements of post-travel reports and ongoing upgrades to the user interface.
In 2009, American Express Business Travel is introducing its FIVE STEPS approach to achieve best-in-class travel and expense management. The STEPS are designed to allow clients to gain deeper insight into their programs, derive more value from their travel investments by enacting smarter measures and empower decision-makers to adapt more readily to a rapidly changing business landscape.
- Sourcing Savvy. Break The Model, Not The Budget.
Simply relying on corporate buying power is no longer a safe approach to deliver the kind of leverage and discipline necessary to wring every dollar of waste out of your travel program. Negotiating reasonable rates can no longer be the foundation of a business travel strategy. The time is now to get creative and generate higher savings from lower aggregate spending on hotels, air and car. Companies need to reduce "rogue spending" to take advantage of every travel dollar, revisit preferred carriers or properties to make the most of new volume levels, and take advantage of changing inventories and capacities to get the most out of travel budgets.
- Transform The Model. Challenge The Status Quo.
Under normal circumstances, taking moderate measures to drive incremental improvement would be acceptable. Against the backdrop of the economic contraction, small change is not enough to deliver the kind of efficiency necessary to stay solvent and competitive. Leaders need to ask the tough questions related to driving rapid and pervasive cultural change in order to achieve policy compliance and shut down maverick spending: Has my travel partner provided the tools and the change management approach to eliminate non-essential travel or drive toward travel alternatives such as high-quality web conferencing, and would alternatives such as outsourcing drive down fixed expenses?
- Empower The Traveler. Guarantee Productivity.
Investing in employee travel to win and retain business translates into growth in sales and profit. While scaling back on travel is a critical element of managing in the downturn, it is equally important to ensure that employees in revenue-generating positions remain on the road, energized, more efficient and more effective than ever before. Providing road warriors with the tools and resources they need to be productive ensures your travel investment yields the highest rates of return. Having a travel provider with the technology and platforms needed to deliver concierge services to travelers on the road is a critical component of world-class service.
- Precision And Control. Be Exact, Close Is Insufficient.
The speed of change in today's world means making decisions in real-time with precise data. It is not enough to look at static reports and react to historical data. Data needs to be accessible at your fingertips, with the flexibility to drill down into individual transactions to spot trends and policy "leakage." Having accurate assessments of your travel spending isn't enough when the economic realities demand exactness and the ability to convert data into action plans that drive results. Precision is using laser-like focus to identify what internal travel to cut and what tools and solutions can deliver on that plan. It's carefully benchmarking your spending against peers and converting that information into a competitive advantage.
- Service Excellence. Drive Savings Without Sacrifice.
While finding every possible way to minimize excess costs, a company must also not forget to ensure employees are properly cared for and their needs are met so they can continue to represent its brand and services in the best way. Even in times as challenging as these, travel programs must continue to deliver high levels of satisfaction. Today, it's about driving savings without sacrificing service quality.
"Travel is the second-largest area of spending for most corporations. As the effects of the economy continue to impact corporate travel budgets, it will be even more important for companies to seek out true service, sound advice and cutting-edge solutions to ensure a maximum return on their tighter travel investments," said Mr. Petruccelli. "At American Express, we continue to prioritize the needs of our clients to offer the most relevant solutions in a dynamic environment that has all eyes focused on greater cost control and more value. Ensuring access to the most innovative choices and solutions will play a significant role in how corporations weather this economic storm successfully."