Business Travel, Two Years Later: Moving On from Lockdown
The world has lived with covid for more than two years now.
Two years of tragic losses, being separated from friends and loved ones, and living day to day in anxiety. Two years of facemasks, hand sanitiser, business closures, travel restrictions, and chaotic supply chains.
It still – even after more than two years of covid – feels surreal. But there’s finally some hope. Lockdowns, at least in most parts of the world, seem to be a thing of the past.
Business travel is back.
And yet, as one crisis comes under control, another emerges. Chaos, it seems, is the theme of the decade so far. Unprecedented times indeed. So, what’s really happened in business travel since 2020? How has it changed?
And (dare we ask), what’s next?
What’s happened in business travel since March 2020?
Although the timelines in different countries were different, sometimes strikingly so, the key events in business travel since March 2020 followed roughly the same path.
- By March 2020, lockdowns and border closures were in effect, almost worldwide
- Businesses rapidly shifted meetings and events from in-person, to virtual platforms
- Total global business travel expenses contracted by 52 percent
- Vaccine rollouts boosted confidence, and opened regional and domestic travel
- As borders opened, safety guidelines, contact tracing and quarantines added friction
- New variants, waves and further lockdowns shook confidence once again
- Businesses re-evaluated their travel needs; what’s essential?
- Appetites for business travel, events and meetings return – with a focus on ESG
First, there were lockdowns…
By the end of March 2020, more than 100 countries had entered a lockdown phase; either national or localized. The entire travel industry was rocked. Passenger flights were all but grounded, and meetings and events were off the table. Unlike ferrying PPE and ventilators, business travel was seldom described as “essential”.
But for the most part, businesses prevailed. With the likes of Zoom, Microsoft Teams, and Google Meets, the virtual meeting space had reached the mainstream. Remote work was in full swing, and companies were soon learning what worked and what didn’t. Some of the world’s best-known and biggest events, conferences, and expos went virtual, with a fair amount of success.
But as this happened, the travel market was in freefall. Managed corporate-travel spending in the United States alone was down by $94 billion. And within this, there was an appetite among many businesses to return to in-person work, meetings, and conferences.
Then came the vaccines – and the variants
The first Covid-19 vaccines, created in a monumental global collaboration between Pfizer and BioNTech, were administered in December 2020. Soon after, the first round of public vaccinations were complete. By mid-2021, covid cases in the UK (one of the worst affected nations) were consistently in decline – for the first time since lockdowns were introduced.
And so, over a year into life with covid, a tentative return to summer travel came into being. But it wasn’t all smooth sailing – some countries were deemed unsafe to travel to and from, and confidence was mixed at best, with sudden changes to travel rules imposed at a moment’s notice. Regional and local travel (including domestic conferences and meetings) were back on; but new variants of the virus reminded us all that this wasn’t over. And businesses began to hedge their bets once again. Hotels, eager to avoid another year like 2020, got innovative in 2021.
Many adopted contactless technologies and digitization, to make entry quicker, easier and safer. “Workcations” were introduced – setting up temporary offices away from home, so people could escape from chaotic dining table workstations, or just get a change of scenery. Some hotels even offered covid isolation services for healthcare professionals and key workers.
It forced hotels to become modern and flexible – but it also prepared them for the future; a contactless world, where digital is at the forefront, and nothing is ever certain.
Travel – back in business
Two years on, and in many ways, the world feels a little bit more like it used to. Concerts are back, restaurants are full, nightclubs are open – but people are still getting covid.
One of the key differences is the recovery in business travel. HotelHub’s monthly global transactions rose to 61% of pre-pandemic volumes in January.
2022 has so far been a triumphant year, as new business travel bookings rose by more than 400% in the final week in February over the same period in 2021.
Even with this resurgence in confidence, and a renewed appetite for business travel, things aren’t at 2019’s pre-covid levels just yet. And there’s a few reasons behind this.
Is all business travel essential amid global instability, and environmental movements?
Business travel is bouncing back – that’s for certain. And for many companies and their client bases, in-person meetings and events are their business. Safety will always be paramount, but business travel will always happen.
However – key changes to attitudes are now emerging. There’s a focus on ESG, and if an in-person meeting that involves travel-related carbon emissions could be avoided with virtual meetings, businesses that can will invariably choose the virtual option. Virtual meetings are so normalized now, that this tends to be the first option anyway.
There’s also the looming threat of global instability – war, food shortages, and fuel price rises to name but a few. Everything’s expensive. And even with travel now largely deemed covid-safe, fear of getting caught up in the Russia Ukraine conflict is prompting some would-be travelers to stay put, while operators cut ties with key routes.
From chaos, to stability, to chaos once more. Is this the future of business travel?
The next five years in business travel
Certainty and clarity have been hard to come by for the entirety of the 20s so far. But we think some things are definitely going to continue.
Where business travel is still essential to operations and service levels, the process will be leaner, faster – and more digital than ever.
Virtual card payments, contactless digital keys, and more automated, app-controlled hotel experiences are becoming the norm. Centralized billing will save corporate travelers from the hassle of separating expenses and personal costs. This rise in automation will also help relieve the staffing pressure on travel and tourism – with fierce competition made even more difficult by the rising cost of living.
Self-booking platforms for hotels will become more important, in part because of the changing trends among corporate travelers. In short, digital is improving business travel experiences massively, which is important considering the key changes to corporate traveler demographics.
Generation Z – welcome to the world of business
In the next five years, your typical corporate traveler (and core workforce) is largely going to be made up of members of Gen Z and tail-end millennials. These are the children of the digital revolution, used to tailored experiences and being in control of everything through their phones.
This is also the generation robbed of key experiences thanks to covid. They want to travel, and they’ll seek out experiences through work, social and personal means. And it’s likely that they’ll mix business and pleasure – through longer trips.
Bleisure travel has more benefits, though – to employee wellbeing and to the company. Allowing for leisure time on business trips can positively influence mental health, productivity, and motivation among employees, and improve their engagement with the organization.
That’s a big factor to consider, especially during the “Great Resignation” and increased competition for talent – but it also puts your people first, and treats them as more than just traveling assets.
Longer trips and reduced environmental impact
Rather than making more trips, we expect fewer flights in favor of longer stays. Corporate travelers seeking to reduce their carbon footprint, and companies engaging in ESG initiatives, will be keen to accommodate for this.
And for those looking to take their environmental commitment to the next level, there could be a whole new world of possibilities on the horizon.
The metaverse: an immersive digital world, hyped as the successor to the internet. It’s accessed by a VR headset – and right now, it’s something of a joke. Which belies the potential of it, and the impact it might have. Good and bad.
Current metaverse demos are somewhat unappealing. One day, though, it could be indistinguishable from reality. And it could potentially eat into business travel.
RendezVerse – a new platform being built by Peter Gould, founder of Private Luxury Events and T-Fest – aims to reduce unnecessary site visits and environmental impact, by building a “second world” of venues in the metaverse.
The platform wants to provide an immersive, 3D virtual “twin” of a venue or space, allowing meetings to take place in uncanny virtual simulations, via a headset.
While this sounds very space-age and cool, ultimately – we’re human. We crave human connection. We want to spend time immersed in places, with people, having experiences that touch all of our senses. When we meet people, we want the whole package.
For smaller events, shorter trips, or just for the novelty factor – the metaverse might actually suit a lot of businesses, especially the environmentally-conscious. But we’re not sure it’ll catch on across the board. Let’s check back in five years…