Skift Take

American Express GBT's top boss Paul Abbott knows that having a distributed workforce can boost business travel spending. The travel management giant itself went 90 percent remote in the U.S. several years ago, and it saw its business travel expenses rise.

The world’s largest travel management company added corporate clients even as the pandemic crushed business travel. The client wins at American Express Global Business Travel (GBT) may sustain hope for an eventual recovery in the broader corporate travel sector.

“Last year was a record year for us, as we signed over $3 billion in new business, including some of the largest technology companies in the world,” said CEO Paul Abbott, when he spoke Wednesday at the Skift Live Business Travel and Future of Work Summit.

A year of remote working has upended business travel. Some experts predict that the corporate world will opt for a long-term reduction in business travel. Even a shift to 5 percent more video-conferencing could capsize many travel companies whose profits depend on long-haul international trips with fat expense accounts.

Abbott dismissed worries about his company’s prospects. American Express GBT, half-owned by American Express and half-owned by investment firm Certares, shifted 90 percent of its U.S. employees to remote work several years before the pandemic hit.

paul abbott ceo amex gbt march 2021

Paul Abbott, CEO of American Express GBT, talking at a Skift Live event in March 2021. Source: Skift.

“Our real estate costs went down, but our travel costs went up,” Abbott said. “What we found when we did that is you can recruit talent in different places, which gives you tremendous flexibility. But you have to bring people together more often for training, to build your culture, etc. Having a more distributed workforce is one of the tailwinds for travel.”

For travelers, American Express GBT has an opportunity to make distribute workforces easier to manage, Abbott said.

Earlier this month in North America, it launched a “workspaces” booking service to help remote workers and small teams make daytime reservations for meeting venues, co-working spaces, and other collaboration spaces. Customers can also get “preferential rates, terms, and amenities” from selected partner hotels.

American Express GBT recently made other moves to tap into the remote working trend, too.

The rise of remote work has made a travel manager’s job a lot more strategic. A travel manager now faces big picture questions from the C-suite at their companies. American Express GBT has an opportunity to help travel managers answer those questions.

“It’s a strange situation,” Abbott said. “Demand has probably never been lower, but our ability to add value has never been higher due to the complexity that exists for clients.”

Betting on Tech Investment

American Express GBT, which helps mostly large and midsize businesses book airfare and hotels, had booked $35 billion worth of travel for clients a year before the pandemic.

Like any goliath, American Express GBT has faced its share of Davids attempting to take it down. Many startups and young companies touting tech-focused approaches to parts of travel management have sprung up in recent years.

In the past year, American Express GBT bought two of these young upstarts. In October, it acquired 30SecondsToFly, a technology startup specializing in artificial intelligence. In January, it acquired Ovation Travel Group, an agency catering to high-income clients.

But several other business travel startups claim to be more innovative and digitally savvy than “legacy” players. Skift Corporate Travel Editor Matthew Parsons asked in the interview whether American Express GBT saw itself on the backfoot.

Abbott balked at the implicit assumption that only new entrants focus on technology.

“We’ve invested $600 million in technology in the last five years,” Abbott said. “I imagine that’s more than any other travel management company — and certainly more than any new entrants.”

Abbott namechecked several American Express GBT tech efforts, such as a suite of e-commerce and digital products and “a flexible, modern core platform” that powers its solutions across all segments. He also touted recently added capabilities for messaging travelers, distributing airfares in more modern ways, and keeping people informed of changing developments (with a new tool called TravelVitals).

Abbot said he expected further consolidation of the business travel sector.

“That would have happened even without the pandemic because it requires a high level of investment to compete now — particularly in e-commerce, digital solutions, and technology infrastructure,” Abbott said.

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Tags: amex, amex gbt, business travel, corporate travel, corporate travel management, skift live, tmcs, travel management companies

Photo credit: Business travelers wearing face masks walking outdoors with luggage during the pandemic. American Express Global Business Travel (GBT), a travel management company, recently signed $3 billion in new business, said CEO Paul Abbott. Adobe

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