Transcript ###The Business Travel Environment

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The Business Travel
Environment
BTEC National
Travel and Tourism
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Introduction
• This session forms an introduction
to Unit 8, Business Travel Operations.
• This unit aims to ensure that learners
have a good understanding of the
importance of the business travel
sector.
• The session aims to help you examine
the business travel environment.
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Business Travel & Tourism
• Business travel is a growing element of
the overall travel and tourism industry.
• It is thought to be worth more than £16
billion annually.
• In 2001, spending by business visitors
exceeded that of leisure visitors.
• Business travel and tourism includes
a wide range of events and services.
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Business Travel Characteristics
• High quality, high yield (earns more
revenue) part of travel and tourism.
• Lengthens the high season for leisure
tourism destinations in UK.
• Year-round sector means more full-time
jobs.
• More ‘shock-proofed’ against downturns
or disasters.
• Investment can regenerate
urban areas.
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The Components of Business
Travel
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Conferences and meetings are worth
over £7 billion in 2003.
This part of the sector includes:
sales conferences
management meetings
annual general meetings
training courses
business presentations
and product launches
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The Components of Business
Travel
• The market for exhibitions and trade
fairs is worth over £2 billion per year.
• Trade exhibitions are for buyers and
sellers in specific trade sectors.
• Public exhibitions attract paying
members of the public.
• Trade/public exhibitions aim to attract
both types of visitor.
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The Components of Business
Travel
• Incentive travel is used by
organisations to motivate their staff.
• Travel rewards cost between £500
and £5,000 per head.
• They are usually offered in industries
with high profit margins such as cars
and financial services.
• Qualification for incentive travel
is based on achieving agreed goals
(usually sales targets).
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The Components of Business
Travel
• Corporate events include staff
and client entertainment.
• Sporting occasions are the most
popular for corporate events.
• Close links exist between corporate
events segment and the contract
catering industry.
• Market worth between £700 million
and £1 billion per year.
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The Components of Business
Travel
• The outdoor events segment brings together
local authorities, show organisers, event
management firms, promoters and venues
owners.
With…
• Equipment and services firms, consultants,
and entertainment agencies.
• Putting on thousands of events
across the country every year.
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The Components of Business
Travel
• These first 5 segments of the industry
are known as examples of
‘discretionary’ business tourism.
• This means that the organisers
have a choice over the destination
of their events.
• Corporate travel is a ‘non-discretionary’
segment.
• This means there is no choice
over where it takes place.
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The Components of Business
Travel
• Corporate travel is a £6 billion
annual market.
• Overlap with all other segments of the
business travel and tourism industry.
• May involve travel by air, rail, coach, car
and sea.
• Can lead to individual and family travel
beyond the business segment.
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Business Travel Agencies
Business travel agencies share many
characteristics with retail travel
agencies:
• They can be trans-national businesses,
national organisations and independent
companies.
• They may offer a mix of business
and leisure travel services.
• They have been affected by the rise
of internet tourism distribution.
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Issues in Business Travel
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Again, many of these are the same as
those faced by retail travel agencies:
Cuts in commission paid
to travel agents.
Non-commission fees for travel agents.
The rise of the low-cost airlines.
Direct sales to customers
via the internet.
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Conclusion
• Business travel is a highly valuable part
of the travel and tourism industry.
• Not only does it continue to grow, but
average spending by business travel
customers is higher than in the retail
sector.
• Venues and cities compete through
‘place marketing’ to appeal
to customers in the sector.
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