Skift Take

Whether it is hotels offering sporadic housekeeping or over-overcrowded airport lounges, service levels across the travel industry have plummeted coming out of the pandemic. Loyalty indeed is under severe pressure.

The pandemic has loosened business traveler loyalty allegiances and is now “up for grabs,” two corporate travel executives agreed.

Speaking on a panel, “As Business Travel Returns, How Will Service Shift as Expectations Rise?” at the Skift Aviation Forum on Wednesday, Michelle McKinney Frymire, CEO of CWT, agreed with Bryan Terry, global aviation leader at advisory firm Deloitte, that airlines will have to fight to retain the loyalties of business travelers.

Offering more flexibility in airfares, lower change fees and better policies “are going to matter,” McKinney Frymire said. Airlines will find themselves with greater pricing power if they retain flexibility, enabling road warriors to reuse fares without “onerous” change fees, she added.

Terry said airlines have extended loyalty status and will have to double down to retain their frequency flyers. But there is also an opportunity to win premium business travelers, he said.

Terry said airline service levels on board the plane and in airport lounges have not recovered to pre-pandemic levels, adding that lounges are often overcrowded instead of the oasis that business travelers value.

He argued that airlines need to reimagine the lounge experience, and to perhaps change them into revenue streams rather than offering them as complimentary.

Skift’s corporate travel editor, Matthew Parsons, moderated the session.

On another hot-button issue, sustainability, McKinney Frymire and Terry agreed that corporate travel policies have yet to change to reflect keener interest in the issue.

The CWT boss said there is great interest among the travel management company’s clients to obtain information about sustainability so they can understand the environmental impact of their decisions.

“But it really has yet to translate into deep, meaningful policy changes,” McKinney Frymire said. “We don’t see clients yet saying we want to book the lowest direct fare, not the lowest logical fare.”

Terry, who advises airlines on business travel and related issues, said Deloitte’s own travel policies have yet to change much regarding sustainability, but he expects they will in the future. However, he does see “greater enforcement of existing policy” to ensure a business trip is really justified.

The panelists agreed that travel policies today need to take into account employee well-being, and this overlaps with a real battle to retain and recruit talent in a tight labor market. Road warriors sometimes book up to premium economy and business class seats when they might not have before because, like airlines, Deloitte is “fighting” for talent, Terry said.

“The battle for talent is real,” CWT’s McKinney Frymire said, adding that clients clamping down on who’s allowed to travel can be seen as “anticompetitive” when it comes to recruiting talent.

There’s been a relaxation of some policies, she said, such as allowing employees to buy a premium economy seat because companies want them to be happy and productive.

Both panelists agreed that the business travel recovery will be multiyear — and uneven.


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Tags: airlines, airports, corporate travel, cwt, deloitte, labor, lounges, loyalty, skift aviation forum 2021, skift live

Photo credit: Swiss first class lounge. Coming out of the pandemic, some airport lounges are overcrowded. Swiss

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