Contrary to dire predictions, business travel is making a comeback ― but it looks different
There was no shortage of people eager to declare that the pandemic would kill off business travel. With Zoom meetings the new norm for the past few years, air travel being fraught with delay nightmares and costs being squeezed, many made reasonable predictions that business travel might be one of the first things to disappear in the new business world. (Heck, we’ve definitely mused about it in this newsletter!)
Well, to paraphrase the old Mark Twain quote, reports of the death of business travel have been greatly exaggerated.
“Microsoft founder Bill Gates predicted that more than 50 per cent of business travel would disappear, and even some senior airline industry bosses thought a significant chunk was gone forever,” writes the Financial Times’ Philip Georgiadis. “But in reality, executives have been quick to abandon video calls and get back on the road. Like many changes that seemed permanent during the pandemic, old habits have steadily returned.”
That’s been backed up by what airlines and hotel groups are saying in their quarterlies. In their most recent quarterly earnings report, Delta Air reported that their small- and medium-sized business bookings had fully recovered to 2019 volumes. Marriott reported that hotel demand was “strengthening” for corporate group bookings. And last fall, Southwest Airlines said it saw evidence that business travel was returning in strength.
Ariel Cohen, founder of the corporate booking platform Navan, suggested that what’s going on is that the nature of business travel is changing, but the volume of it is holding steady. Fewer salespeople are hitting the road on sales trips, but more companies are flying people to a single location to meet.
“The theory is that because you have remote work, people need to meet more because they don’t know each other.” (That seems to track with something else we’ve talked about in Worklife ― the increasing trend of internal “retreats” accounting for a good chunk of business travel.)
Interestingly, the pandemic shove to remote work is also contributing to the biz travel bounce back through a marked rise in “bleisure” and “flexcation” travel, which combine the worlds of leisure and business travel.
And there’s even more hope within the industry that as China relaxes its Covid rules, that the numbers will keep going up. “We believe there’s still further upside for 2023, especially now that China’s borders have reopened,” said Marriott president Tony Capuano.
Content written by Kieran Delamont for Worklife, a partnership between Ahria Consulting and London Inc. To view this content in newsletter form, click here.