What is Booking Leakage and How Does it Affect Your Travel Program?
As employees book travel for business meetings and events, there is a lot that goes into the process making it appear complex to some. While organizations often have a corporate travel policy that employees should follow, that doesn’t always happen, leading to “booking leakage.” So, just what is booking leakage and how does it affect your travel program success?
Why Is Booking Leakage Important?
Many organizations use a travel policy that recommends employees to use a specific booking channel as the default booking method; however, employees don’t always follow those guidelines. While there may be situations that warrant a deviation in the status quo process, the fact is, many people actually make flight and hotel arrangements outside of the requested policy for various reasons: unfamiliar with the process, having not loaded the app, unaware of the policy or simply assumed speed and ease with the platform they are most familiar with.
While for some, this could look like work has been lifted from the travel department, the truth is when this happens, travel managers are unable to track any of the travel plans making the employee and their expenses, invisible to the organization.
Did You Know? Traditionally, 37% of hotel bookings and 15% of flight bookings are made outside of corporate channels, creating what we call “booking leakage.”
While this invisible spending makes life more difficult for travel managers to track and capture spend metrics, booking outside of an organization’s preferred travel program also makes things much more difficult for travelers and can pose risk for traveler tracking and communication.
What are the Cons of Booking Outside of Your Organization?
Travel can be stressful, and to support duty of care initiatives, strong TMCs like Fox World Travel offer peace of mind by taking the lead on travel changes or issues that may arise. The challenge; however, is when hotels or flights are booked outside of the organization’s travel policy. This hurts travelers, as they lose out because contracted discounts and savings programs the TMC has automatically programmed aren’t applied. Just as stressful, travelers are often stuck on their own when issues arise leaving them to personally call airlines and hotels wasting their already tight on-the-road schedule and adding significant stress to the trip.
This is exponentially difficult in any kind of emergency situation. If an emergency were to arise within the organization, at home or with weather conditions, there would be no standardized way for a travel manager to track and confirm a single employee’s safety, let alone a group of travelers if booked on their own.
Thinking of leakage from that angle shines a whole new light on the risks and how it affects your travel program. Encouraging employees to learn your travel policy, effective communication and leadership buy in will all play a role in mitigating traveler risk and helping you run a successful travel program.
Need advice on policy management or leadership buy in? Ask us, we are glad to help.
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Thank you for this; I don’t understand why a corporation would permit any employee to book outside of policy. In addition to the things mentioned here: When booked outside of policy should the employee cancel their flight, the value is the property of the employee and not the company. Travelers are recognized as Business Travelers if/when they follow policy, not so when they book direct. Problem that I face as a travel manager pushing this is: The higher ups approve it because they just don’t know what they don’t know so, any excuse the employee uses is approved by those who don’t know any better. Thank you for shining a light.
Hello Sharon. Thank you for your feedback. We are glad you found our latest blog beneficial. We have an upcoming lunch & learn webinar coming soon to further discuss online booking adoption with insight from our technology team. We hope you can join us! Stay tuned.