A period of consolidation could be on tap in corporate travel as online travel agencies seek to bolster their offerings and travel management companies seek to scale up their technology offerings.

“There was a period in corporate travel where there was a ton of consolidation, as far as American Express GBT and Carlson Wagonlit Travel go,” said Dara Khosrowshahi, Expedia CEO, during a GBTA Convention 2016 panel on consolidation. “I do think there will be consolidation in the corporate travel space because some of these companies don’t have the scale to invest in technology… there’s going to be a lot of consolidation in this industry; financing is cheap and it’s driving acquisitions activity.”

Expedia clearly has ambitions in corporate travel. Expedia’s Egencia is already the 5th largest corporate travel agency in the world and it has acquired several travel management companies over the years. “We think over the long term this can be a very big business on its own,” Expedia CFO Mark Okerstrom said in March. “We want this business to be significantly larger than it is today and that is absolutely the plan.”

Reflecting on the risks of scaling up, Khosroshahi at the GBTA panel said continued growth has given Expedia a wider range of strategic options than it would have had otherwise.

“Bigger can be better, if you execute well,” said Khosrowshahi. “We have 450 million consumers who come to our sites on a monthly basis. Scale creates huge efficiency and then you can take that efficiency and hand it over to your shareholders… or reduce distribution prices, or invest in ourselves.”

With that said, Khosrowshahi also discussed the challenges of acquiring a company for its capabilities and then having to integrate its employees into Expedia’s corporate culture.

“[Acquisitions] just to bring in a capability is difficult because you need to bring in that talent and make them feel comfortable in a new environment,” said Khosrowshahi. He said Expedia is currently looking at bringing in engineers skilled in artificial intelligence to better analyze and parse its flight search data.

CEO Reggie Aggarwal of Cvent, which was recently acquired by Vista Equity, said travel companies need to take a measured approach to acquiring companies to add to their product set. Cvent offers a meetings- and event-management platform.

“It’s important to have a balanced approach,” said Aggarwal. “Right now a lot of companies are starting to view themselves as a technology company because it’s a differentiator… As they realize there are [already] companies that are best-in-class, they need to make sure they [are realistic about their goals].”

In a world where customers aren’t loyalty to a single brand, however, scale can help travel companies provide a wider range of products to consumers.

“The idea of being able to exclusively own that relationship [between consumers and travel booking] today? You’re dreaming,” said Kevin Frid, Accorhotels’ new chief operating officer for North and Central America. “The world has changed so much that I’m using the word ‘Expedia’ and ‘friend’ in the same sentence…  one of the things that scale does for us is allow us to give greater choice, we’re talking brands but also locations around the world.”

Reflecting on the overall macroeconomic situation, Frid said he thought a new round of acquisitions will likely be driven by the start of a new business cycle.

“I do believe this next landing is going to be soft, so we could already be in it,” he said.

Photo Credit: Dara Khosrowshahi, CEO of Expedia, earlier this year. He spoke at GBTA's annual conference about pending consolidation in the corporate travel sphere. WTTC / Flickr