Q&A: What Today’s Cost-Conscious Corporate Travel Managers Need to Know

This sponsored content was created in collaboration with a Skift partner.

Business travel is bouncing back, but rising inflation and a looming recession continue to keep many companies in a cautious, cost-conscious mode. Today’s corporate travel managers must balance the needs of the newly ascendant blended traveler while maintaining compliance with company policies, enforcing tighter controls on spending, and supporting sustainability goals.

SkiftX spoke with Duke Chung, CEO of TravelBank, to explore how technology is helping companies adapt to this changing corporate travel landscape and learn how TravelBank is positioning its travel and expense management services after being acquired by U.S. Bancorp in 2021.

SkiftX: What has your research revealed about the current needs and expectations of corporate travel managers, particularly as more companies switch to remote working environments?

Duke Chung: Post-pandemic, we’re seeing a much higher expectation around accountability for budgets, especially as we head into a potential economic downturn. Our clients are looking at the numbers more carefully and asking when the ROI for travel is coming back. They want an all-in-one solution that brings the best in expense management, travel, and virtual cards together. Having these utilities in one place makes it easy for their employees to book and expense travel.

In a survey of almost 2,400 finance leaders across different industries, we found that demand for a consolidated financial system is higher among smaller companies. Perhaps it’s not surprising considering smaller businesses have less overhead and often struggle to manage multiple systems.

I’m looking forward to the results of our newest survey, conducted in partnership with Skift, which will help us better understand how corporate travel decision-makers are adapting, and how these consolidated systems are affecting their policies, programs, investments, employee communications, and employee satisfaction.

SkiftX: How do artificial intelligence (AI), machine learning, and automation help business travelers and corporate travel managers be more proactive?

Chung: AI is everywhere right now, and its capability around travel recommendations is coming into sharper focus. This is important when it comes to making purchasing decisions. People are seeking immediate solutions, so machine learning is being applied to virtual assistance for travel support.

We’re also seeing more automation happening on mobile devices and embedded devices like airport kiosks, which facilitate a better overall travel experience.

With our all-in-one solution, we can securely leverage data sets that are gathered around card purchases across multiple businesses and build machine learning on top of that to help users and finance teams understand where they’re spending money and how to save more money and provide better experiences.

SkiftX: What are the benefits of adopting a virtual card setup for corporate travel managers? How have business travelers responded to using them?

Chung: We’re seeing a boom in virtual card adoption in this post-pandemic world of remote working, partly because virtual cards are such an efficient way to get payment cards to remote employees. The other reason is that everyone now has a mobile device — and when we travel, we tend to lean into our mobile devices more. We check into flights, review itineraries, check schedules, and make payments. As mobile wallets become more widely adopted, virtual cards will become a way of life.

Our virtual card gives managers the ability to set limits on expense amounts and create parameters for where the expense is made. Everything is reconciled in real time, so they don’t have to do anything. It’s very efficient and syncs up with the traveler’s mobile wallet. The virtual card shows their budget and remaining credit, and everything they spend is automatically synced into the expense system.

SkiftX: TravelBank can set up dynamic travel budgets that change based on current pricing trends. How does that work?

Chung: Dynamic travel budgets factor in real-time fluctuations in pricing. For example, there might be a surge in pricing during a conference in San Francisco. If you’re using a static cap system, the caps may stay at $250 even when the average price of a hotel goes up to $700 because of increased demand. With dynamic budgets, we look at live inventory and price out the average cost of your hotel stay for the specific time that you are staying. We give you a real-time budget, so if you need to be there for a conference, you’ll know you need to spend more. Otherwise, you can consider going another week.

We also offer reward incentives, so let’s say the average cost of the hotel is $300 and you’re staying there for one night. If you have $300 in your budget, you’ll probably spend it — but what would incentivize you to pick a less expensive option? With our incentive program, you can choose a less expensive hotel and split the savings with your company. Let’s say you pick a hotel down the street that’s $200. You’d save your company $100 and your company would pay you a reward of $50. It’s a win-win for you and the company, and they aren’t forcing you to do anything.

SkiftX: How can travel and expense management support sustainability and help companies be more responsible?

Chung: For us, the first phase is about awareness: How do we drive awareness around sustainability before and after transactions are made? In the booking display, we can show how many carbon offsets are being generated in the choices you’re making. Then, after purchase, we can assess your carbon footprint based on your spending behavior, the vendors you’re using, and the items you’re purchasing.

From there, it’s about building further awareness and helping users make choices — but at some point, it’s really up to the suppliers. They have an opportunity to help us find more efficient ways to reduce emissions and improve sustainability. Without the awareness, and without it being top of mind for companies and employees, it gets pushed to a lower priority — but we think we can be a change agent in that process. Building these experiences into our user interface is really important.

SkiftX: Where do you see new opportunities for growth in the fintech space?

Chung: You’re going to see more banks become software enabled so they can deliver more capabilities. When the fintech boom happened, traditional banks realized that they needed to find ways to deliver more value to their clients, so they started looking at software solutions for travel and expense management. The acquisition of TravelBank is a good example of that.

Embedded finance capabilities will become more commonplace as more banks move into an open banking environment. For example, when you book through TravelBank, we embed the payment capabilities and save them in our system. Whether it’s a corporate card, virtual card, or another card. We support all of those options, and I think more and more banks will follow suit.

The need to take a plastic card out to pay for something may go away entirely. The world is becoming more integrated into financial payment capabilities to the point where it almost becomes passive. Think of when you are using a ride-sharing app. Do you ever really think much about paying for your ride? Probably not. Payment happens safely and securely behind the scenes — and that’s part of this fintech revolution that will continue unfolding.

Believe it or not, many very well-established businesses are still running their expenses on Excel, so there’s still a great opportunity. Ask me again in 10 years, and I’m sure every business will be on an expense travel and card solution.

For more information about TravelBank, click here.

This content was created collaboratively by TravelBank and Skift’s branded content studio, SkiftX.