First rolled out in California in June 2018, they are also authorized in Arizona, Texas, and Florida.
That means pushing the message of safety, service, and duty-of-care with corporate travel managers and procurement officers, while cultivating better business relationships through more frequent contact. Three LCT Leadership Summit panelist experts expounded on those themes May 23 in a presentation, “How to Monetize the Millennial Business Travel Sector.”
Know Thy Buyers
Operators should be aware that a corporate client often consists of three types of customers in the company: A procurement officer, a travel manager, and the individual executive or employee travelers using the services.
“Sometimes we don’t even understand ourselves,” said panelist Jorge Gomez, who runs the corporate travel program for Miami-based Mondelez International. “Within our organization, you might have separate travel and procurement divisions. Now you have two sets of customers with different ways of looking at the business. Then you have a third one, which is the internal customer. It’s kind of complicated because you have to balance all of their goals.”
Limo operations should create solutions for the corporate travel buyers, Gomez said. “To satisfy the internal customer from a service perspective, it has to be a common goal, because the internal customer is not going to be any different just because the one leading the relationship is the procurement guy or travel guy. The internal customer is the same.”
Millennial generation travelers, younger adults ages 35 and below, are making this equation more challenging, because they think and act differently than older generations, Gomez said. “You need to adapt and you need to make yourself different.” To get their attention varies, as companies follow different policies on doing business with TNC disruptors, he added.
Lyft is one example of a TNC that builds cohesive relationships with corporate travel managers and the corporate travel department, said panelist Lenore D’Anzieri, chief strategy officer for Limo Alliance, an app developer in the limousine industry. “They understand the corporate travel buyer a lot more and have taken the time to create those relationships with their buyers. They’re in the marketplace being very sweet and understanding and listening, and wanting to give the travel managers what they want. They’re working on a robust reporting system that most don’t have. I think Lyft is actually coming out of the gate much stronger. Uber is becoming very obnoxious, which is why a lot of the travel managers are not very happy with them.”
Managing relationships with buyers via account managers is one way operators can distinguish their corporate service, said Mark Williams, founder of Goldspring Consulting, an independent travel consultancy. “Uber and Lyft don’t have account managers. They’re focusing on their app and driving the business through the app.”
Williams finds a lack of interaction between the buyer and the limo companies, unless it’s a large account. “When I was at PricewaterhouseCoopers, we were doing $50 million a year, and so we got attention, but that’s going to be the unusual one.
“Those touchpoints are so important because they allow you to deliver the message of where do you beat these disrupters? The additional services you provide, and the added levels of safety and security and vetting of drivers, get lost. That end user doesn’t focus on that unless somebody gives them a message.”
Procurement executives are motivated to show value inside their organizations, and prove they can save money. The more information they get, via an account manager who supplies reports, the more it helps the corporate clients, Williams said.
“Reporting is important because it supports whatever the strategy is. If you are the travel manager, you want to know how we are serving our internal customers. Are there any complaints? Are there timely pickups? Are there timely drop-offs to the destinations? You have to show that because they don’t always have the resources to do that. They’re probably going to depend on you.”
Understanding your buyer and the reporting they need and how it can help save costs are critical to the success of your relationship, D’Anzieri reiterated. “Cost savings doesn’t necessarily come from price. I think 90% of the time, you don’t lose an account because of prices. It’s the way you sold or maybe the lack of understanding of your customer. What do they need? What do they want? What are their goals? How do I help them achieve their goals?”
Gomez advised attendees to look outside the industry for more professional ways to handle procurement clients and increase revenues and profits. “The airlines and hoteliers have learned from one another how to develop revenue management strategies. Look at their practices and see how you can adapt and put it into your industry.”
Tell The Story
Williams explained how travel buyers are willing to pay more post-recession for better service. He cited a recent anecdote from Delta Airlines, which is getting a 10% premium over competitors. “I think what needs to happen here is the story isn’t getting told. You’re not telling the story of what you can do and how you are better and the advantages you have over the other players disrupting the marketplace. If you tell that story effectively, people will pay a premium for that level of service.”
Some companies already prohibit use of TNCs because of duty-of-care issues, but for the many who don’t, they need to hear about the advantages of duty-of-care during the RFP process, Gomez said. “You have to demonstrate that to the marketplace. It has to be on every single RFP, and the meetings you show up at. Put it in their face on every presentation, on every review, on every RFP. What are the values? Show the non-traditional value creation you could generate for them. Let them decide whether they can report on it or not.”
Many organizations simply don’t deal with the duty-of-care issue, and punt the decision to individual travelers who often prefer the conveniences of an app, Williams said. “They don’t have to talk to anybody.
They can get the car, get in, and get out without saying a word. Millennials in particular like that. But your question is, why doesn’t the industry develop a certain level of standards that becomes a certification for providers you can then market to the buying community? You know Uber and Lyft aren’t going to qualify because they don’t meet those standards. This becomes a big marketing point for you.
“You want to walk in with an RFP and say, ‘We’re certified, these guys aren’t. Do you really want to risk the most vulnerable part of the trip on an accident or an injury or even a death with someone who’s not certified like we are?’” Williams asked. “I think that’s where this industry has to go, and you’re missing the boat because you’re not doing that.”
Competing on price is no longer sustainable, Gomez said. Certification can provide the distinction that attracts corporate travel buyers. “There’s a lot of noise in the market, so that creates confusion. That’s why you have so many buyers going in different directions. So that certification simplifies the way you can create that differentiation.”
In an ensuring discussion among attendees, the point emerged how ground transportation carries more risk for death and injury than airline flights and hotel stays. The death of a senior, high-profile executive crucial to a company’s success in a vehicle could be devastating. Persuading companies to reduce risk through responsible duty-of-care providers becomes crucial to validating the relevance of non-TNC chauffeured ground transportation.
“You need to get out in front of your buyers,” an audience member said. “You need to attend GBTA meetings, call your buyers, and understand them. You need to be visible in that community so they can lean on you. That will give you all the opportunity to explain your story and tell the story of your industry. The passion you all have, I think, is critical to educating and helping your buyers understand where you’re coming from, what your offerings are, and how you differentiate. If you sit in your offices and do nothing about it, it’s just not going to happen.”
First rolled out in California in June 2018, they are also authorized in Arizona, Texas, and Florida.
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