The Hotel Merger Ripple Effect — Skift Corporate Travel Innovation Report

The Skift Corporate Travel Innovation Report is our weekly newsletter focused on the future of corporate travel, the big fault lines of disruption for travel managers and buyers, the innovations emerging from the sector, and the changing business traveler habits that are upending how corporate travel is packaged, bought and sold.

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The Future of Corporate + Business Travel

One of the biggest hotel merger deals in history is expected to close soon, and that has road warriors and travel managers alike wondering what will change.

When Marriott’s purchase of Starwood for more than $12 billion is finalized, it will be the latest — and largest — acquisition to shake up the travel industry. Just since the beginning of last year, major mergers include the Accor purchase of Fairmont Raffles, HNA’s acquisition of Carlson Hotels, and Expedia’s purchase of rivals Travelocity and Orbitz.

“We’ll continue to see mergers or acquisitions,” Kim Kearns, senior director of supplier relations for BCD Travel, told Skift. “Will it be of the size of this? Probably not.”

In interviews with travel management companies and other experts, Skift found a few themes about the Marriott-Starwood deal: While the giant new company will likely benefit from greater negotiating power, other brands may be eager to attract new business with competitive rates and perks. Some travel managers are concerned that a merged loyalty program could be a detriment to travel policy compliance. And whatever is going to happen won’t happen immediately.

What other challenges (or benefits) might emerge? And who might join forces next? We expect plenty of news still to come out of this story.

— Hannah Sampson, Skift

Social Quote of the Day

@Airbnb it is 2016 and you can’t split a bill between two people? This makes you irrelevant to 95% of business travel. — @joshdr83

 

Business of Buying

Old Technology Is Wreaking Havoc on Airlines’ Complicated Systems: Airlines are investing in upgrades to aging systems, but not quickly enough to avoid massive outages like the one Delta experienced recently. Perhaps the latest incident, which affected more than 4,000 flights, will bump the issue higher on the carriers’ priority lists. Read more at USA Today

Delta’s New Business Class Suites Put It Ahead of Its Competitors, Again: Many airlines spin new products as industry-leading. But this is the real deal. Delta’s new suite looks about as good as business class can get. Read more at Skift

Corporate Travel Is Bracing for the Impact of the Marriott-Starwood Merger: It could still be several weeks before the Marriott-Starwood deal is wrapped up — and much longer before the two companies are integrated — but travel buyers and travel management companies are wise to start preparing now for eventual negotiations with the bulked-up company. Read more at Skift

New Loyalty Program Rankings Reveal a Growing Points Divide for Travel Brands: U.S. News & World Report’s rankings have always skewed more toward leisure travelers than road warriors, but this year’s lists show a growing difference between brands that choose to appeal to the majority of consumers versus those who choose to reward frequent business travelers or big spenders. Read more at Skift

Security + Safety

Data Breach Impacts 20 Properties From Major Hotel Chains: Again, we have to ask: Why aren’t hotels doing more to prevent these kinds of credit card data breaches, and why does it take operators so long to inform their customers? Read more at Skift

Harassment Is a Frequent Issue for Female Business Travelers: A new report that examines the needs of women who travel for business shows that safety concerns are all too common. Read more at Travel Weekly UK

Disruption + Innovation

Uber and Lyft Work With Cities to Replace Public Buses: Uber and Lyft could be part of urban innovation plans to streamline public transit but increased traffic and fumes could be a roadblock in some cases. Read more at Skift

Despite Occasional Quirks, More Business Travelers Are Turning to Airbnb: Airbnb is making headway with corporate travel thanks in part to its classification of some properties as “business travel ready” and agreements with major travel management companies. But concerns about safety, legal issues, and liability remain. Read more at The New York Times

China Considers Allowing Mobile Phone Use for Web Access on Planes: Chinese travelers would get to use WeChat and other mobile applications on flights under new rules now under consideration. There is no safety reason to keep existing prohibitions and lifting them will open all kinds of e-commerce opportunities for the airlines. Read more at Skift

Corporate Travel Should Prepare to Be Disrupted: Uber, Lyft, and Airbnb took the corporate travel world by surprise. Now technologies such as artificial intelligence, the Internet of Things, and virtual reality could change the business even more. Read more at Buying Business Travel

Comments

The Skift Corporate Travel Innovation Report is curated by Skift editors Hannah Sampson [[email protected]] and Andrew Sheivachman [[email protected]]. The newsletter is emailed every Thursday.

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