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T&E spending nears pre-Covid levels for Amex

Posted on April 25, 2022 | by getsetntravel | Leave a Comment

Spending on American Express commercial cards grew to $136 billion in the first quarter of 2022, exceeding 2019 levels, as business travel shows more signs of recovery.

Small and medium-sized business spending accounted for $115 billion of this volume, an increase of 30 per cent year-on-year and up 26 per cent compared with the first quarter of 2019.

The $21 billion in spending by Amex’s large and global clients marked an increase of 42 per cent on 2021, although this was still down by 34 per cent on volumes for the same period of 2019.

Total T&E (travel and expense) spending across the American Express network was 88 per cent of the levels seen in the first quarter of 2019, when adjusted for foreign currency exchange fluctuations.

American Express chief financial officer Jeff Campbell said signs of growth became more apparent for that group towards the end of the quarter.

“T&E spending did show a dip in January and early February due to the [Covid-19] Omicron variant, but spending rebounded tremendously, reflecting pent-up travel demand, and essentially reached 2019 levels for the first time since the start of the pandemic,” added Campbell.

“Overall, we are pleased with the growth momentum we see across the board in our spending volumes, which is tracking in line with our expectations for both the year and for our long-term expectations.”

Across T&E categories, spending on airlines was up 245 per cent year-on-year in the quarter but 34 per cent below 2019 levels. Accommodation spending was up 108 per cent compared with 2021 but down 22 per cent on 2019’s figures.

Campbell said business travel was driving some of that increase, with more spending on premium cabins and higher-end hotels.

“Your average business travel purchase is, of course, much higher than the average consumer purchase,” he added.

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T&E Spending in Amex Network Nears Pre-Pandemic Levels

Posted on April 22, 2022 | by getsetntravel | Leave a Comment

Spending volume on American Express commercial cards grew to $136 billion in the first quarter, above 2019 levels, as large and global clients are beginning to show signs of business travel recovery, executives said in an earnings call.

Small and medium-sized business spending accounted for $115 billion of that volume, an increase of 30 percent year over year and 26 percent versus the first quarter of 2019. The $21 billion in spending by large and global clients marked an increase of 42 percent year over year, though it was 34 percent lower than volumes in the same period of 2019.

Adjusted for foreign currency exchange effects, total T&E spending across the American Express network was 88 percent of the levels of the first quarter of 2019, and T&E spending among small and medium-sized clients was at a similar level. Large and global corporate T&E spending was at 38 percent of 2019 levels, but CFO Jeff Campbell said signs of growth became more apparent for that group near the end of the quarter.

“T&E spending did show a dip in January and early February due to the [Covid-19] omicron variant, but spending rebounded tremendously, reflecting pent-up travel demand, and essentially reached 2019 levels for the first time since the start of the pandemic in the month of March,” Campbell said. “Overall, we are pleased with the growth momentum we see across the board in our spending volumes, which is tracking in line with our expectations for both the year and for our long-term expectations.”

U.S. consumer T&E spending was 20 percent above 2019 levels on an adjusted basis for the quarter.

Across all T&E spending, spending on airlines was up 245 percent year over year in the quarter but remained 34 percent below 2019 levels. Lodging spending was up 108 percent year over year and down 22 percent compared with 2019.

Campbell said business travel is driving some of that increase, with more spending in premium cabins and higher-end hotels. “Your average business travel purchase is, of course, much higher than the average consumer purchase,” he said.

RELATED: American Express Q4 earnings

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India-Based T&E Startup Itilite Scores $29M in Funding

Posted on April 14, 2022 | by getsetntravel | Leave a Comment

Bengaluru-based travel and expense management platform Itilite has raised $29 million in its latest fundraising round, which the company plans to invest on building its brand, growing its go-to-market teams and product innovations, according to the company.

Itilite, which launched in 2017, already had raised $13 million in its most recent fundraising round in 2020. Since then, the company said it has seen its growth quintuple even during the Covid-19 pandemic. It currently reports 500,000 users from more than 300 companies in India and the United States and describes its customer base as “ranging from Fortune 500 blue-chip to technology-forward unicorns,” including biotech company Praj Industries and Toshiba.

Itilite—which offers features such as a trip-cost predictor, personalized booking options for travelers based on booking history and preferences and Mastermind, an AI-powered consulting tool—plans to “aggressively double down on our momentum in the India and U.S. markets” with the latest fundraising round, according to founder and CEO Mayank Kukreja.

The fundraising round was led by investment firms Tiger Global Management and Dharana Capital.

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Amex: 2021 a Banner Year for SME Business, Large Corp. T&E Growth Lags

Posted on January 25, 2022 | by getsetntravel | Leave a Comment

Spending volume on American Express commercial cards continued on an upward trajectory in the fourth quarter, totaling $141 billion compared with $126 billion in the third quarter and up 30 percent year over year, the company reported.

Travel and entertainment spending’s share of that total also continued to increase, comprising 16 percent of total commercial volume in the fourth quarter, up from 14 percent in the third quarter. Commercial T&E volume was down 39 percent compared with 2019 volume, a relative improvement from the 50 percent decline seen in the third quarter.

Average fourth-quarter spending per Amex’s Global Commercial Services division cardholder also increased to $9,235 from $8,447 in the second quarter and $7,515 in the third quarter of 2020, according to American Express. The number of corporate cards in force increased 6 percent year over to year to 15.4 million.

American Express vice chairman and CFO Jeff Campbell in an earnings call said total T&E spending “continues to recover in line with expectations” although the rise of the Covid-19 omicron variant had a “modest impact” with the “pace of recovery slowed in December.”

Large and global corporate T&E volumes reached 36 percent of 2019 levels in the fourth quarter, though they were up 144 percent year over year. Campbell said those volumes will be the “last to recover” for American Express.

T&E spending by small and medium-sized companies, however, recovered to 83 percent of 2019 levels in the quarter. T&E spending by U.S. SMEs was up 145 percent year over year, and for SMEs outside of the United States, T&E spending was up 99 percent year over year in the fourth quarter. 2021 was “one of the best years we’ve ever seen for U.S. SME new account acquisition,” American Express CEO Stephen Squeri said in the earnings call.

U.S. consumer T&E spending, meanwhile, surpassed 2019 levels by 8 percent in the fourth quarter.

Across all T&E spending, spending volume on airlines was down 43 percent in the fourth quarter compared with 2019 levels but up 274 percent year over year. Lodging spend was down 24 percent compared with 2019 but up 134 percent year over year.

RELATED: American Express Q3 earnings

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Buccaneers TE Rob Gronkowski (ribs) not traveling with team, won’t play vs. Patriots

Posted on October 2, 2021 | by getsetntravel | Leave a Comment

Rob Gronkowski’s New England homecoming won’t happen on Sunday night, and the Buccaneers tight end could miss more time.

NFL Network Insider Ian Rapoport reports Gronkowski will not travel with the Buccaneers and will be held out versus the Patriots, per a source. The team later announced the news.

The Buccaneers tight end was declared doubtful with a rib injury on the Bucs’ official injury report Friday.

Rapoport adds that Gronkowski could miss more time after follow-up tests reveal two hairline fractures on his ribs, per a source. Initial X-rays showed no fractures, according to Rapoport, but a CT scan and MRI produced a new diagnosis which could threaten his availability for Week 5.

Gronkowski sustained the rib injury early in the third quarter of last week’s road loss to the Los Angeles Rams. The veteran exited before returning late in the quarter, finishing the game with four catches for 55 yards.

This is the first game Gronkowski will miss since coming out of retirement to play in Tampa Bay ahead of the 2020 season, making his rib injury an untimely development ahead of he and Brady’s return to New England. The 32-year-old got off to a hot start in 2021 with 16 receptions for 184 yards and four touchdowns in the first three games.

Bucs quarterback Tom Brady will still have great options at tight end despite Gronkowski’s absence. Cameron Brate (five receptions, 43 yards) and O.J. Howard (2/32) are now poised to get more opportunities in the Bucs’ high-powered offense which generates plenty of attention with a stellar receiving corps.

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World Famous in New Zealand: New Lynn’s Te Toi Uku Crown Lynn & Clayworks Museum

Posted on April 16, 2021 | by getsetntravel | Leave a Comment

Tucked into the ordinary Auckland suburb of New Lynn is the home of what many consider to be a New Zealand icon: Crown Lynn china.

Instantly recognisable for both their bold patterns and sturdy construction, these dinner sets and ornaments have been part of daily life since 1948 and reached their peak of popularity in the 1960s and ‘70s.

Pamela Wade

Instantly recognisable for both their bold patterns and sturdy construction, Crown Lynn dinner sets and ornaments have been part of daily life since 1948 and reached their peak of popularity in the 1960s and ‘70s.

For both casual visitors and enthusiastic collectors, the museum provides the opportunity to inspect, compare, admire and learn about the brand, its origins in 1861 bricks and power-line insulators and its development through to the factory’s closure in 1989.

Pamela Wade

Most Kiwis would have eaten or drunk from some of this crockery.

WHY GO?

Because you don’t have to be a collector to recognise this china as part of your personal history.

For most New Zealanders, Crown Lynn crockery or ornaments are an instant trip back in time to family dinners or visits to Grandma’s, and the memories come flooding back. While other museums recognise Crown Lynn’s place in national history, and feature it in their displays, it’s only at Te Toi Uku that you will find the actual tools and equipment that were used to make the china.

The museum itself, owned by the Portage Ceramics Trust and recently renovated, is located on the site of the original brickworks and next door is a picturesque old kiln. Displays of plates and mugs, swans, chess pieces and more are supplemented by information about the production processes which, while eventually highly mechanised, still incorporated much hand-work.

While the decorating must have given some artistic satisfaction, it’s mind-boggling now to imagine what it was like spending all day attaching handles to cups. Storyboards not only describe the initial creative processes, but also introduce the people behind them, and detail how the first utilitarian designs were overtaken by more contemporary shapes and decoration, reflecting the increasing sophistication of public taste.

Pamela Wade

Turns out Crown Lynn designs were more artistic than many would remember.

INSIDER TIP

The curator, Rosemary Deane, is a fount of knowledge about the brand, and welcomes questions. If you’re sceptical about how valued these once-common pieces of china now are, have a search on TradeMe and be enlightened.

ON THE WAY/NEARBY

If you want more lovely pottery to admire, then Titirangi isn’t far away, where you’ll find some artfully displayed at Te Uru Waitākere Gallery, plus much more. Colin McCahon House is tucked into the bush nearby, with examples of his art and the full story of his life there. Or you could admire both nature and sculpture at Waikūmete Cemetery, which is a lovely place for a stroll. For something entirely different, the Charlotte Museum is quite close, celebrating lesbian culture with a wide range of exhibits.

Pamela Wade

The museum is located next to an original brick kiln.

HOW MUCH?

Entry is free, though donations are very welcome. The museum is normally open Wednesday to Friday 10am till 4pm and, on Saturdays, 10am till 3pm.

BEST TIME TO GO

If you’re addicted, the museum’s next biannual Crown Lynn Collector’s Market will take place at New Lynn Community Centre on Sunday, May 2 from 9am till 1pm. The first-ever New Zealand Studio Pottery Market will be part of the event. tetoiuku.org.nz

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As T&E Management Evolves, TravelBank Readies More Partnerships

Posted on March 12, 2021 | by getsetntravel | Leave a Comment

Travelbank’s Duke Chung discusses:

The pandemic’s effect on Travelbank’s strategy
The broadening scope of virtual cards
The evolving nature of subscription pricing models

TravelBank’s recent reseller deal with Adelman Travel was the latest step in the travel and expense management provider’s strategic push into the partnership distribution channel, which began last year. The effort is part of TravelBank’s larger goal of advancing its offerings for a corporate travel ecosystem that had been evolving even before the onset of Covid-19 and has seen that transformation accelerate amid the pandemic. TravelBank co-founder and CEO Duke Chung spoke with BTN payments and tech editor Adam Perrotta about the company’s recent moves, along with what’s next for TravelBank and the industry at large.

BTN: Your deal with Adelman in February followed last year’s agreements with World Travel and Upside to distribute your platform through those partners. To what extent was that strategy driven by Covid-19 and how the pandemic has changed how established travel management companies need to serve their corporate clients?

Duke Chung: The partnership strategy was largely driven by the pandemic. TMCs and technology platforms like TravelBank [hadn’t] collaborated as deeply in the past [but] the last year changed that because of how business travelers’ needs shifted. Travel dipped, but companies still needed a way to manage their unused tickets, new work-from-home expenses, reimbursements and corporate payments. … The pandemic essentially accelerated digital transformation by years, if not a whole decade, in the span of one year.

BTN: On the flip side, does the partnership route give TravelBank the ability to reach types of potential clients you might not otherwise have been able to access? I’m thinking of Upside here, given their focus on lightly and unmanaged travel, but it seems this could apply to the other partnerships as well.

Chung: Absolutely. Through these partnerships we’re reaching customers who already have a travel solution but didn’t realize how helpful an expense solution would be until they saw it integrated into the respective platform they already use. Our focus continues to be on creating products and features that streamline the travel, expense, and now, corporate card management experience. By partnering with TMCs, we’re able to stay focused on that.

BTN: Let’s talk more about the corporate card piece. TravelBank last year began offering U.S. Bank virtual cards through your platform, via the booking tool and mobile wallets. Can you give some insight into client adoption of that service?

Chung: It’s been growing rapidly and now represents a greater percentage of our pipeline opportunities. One rising use-case we were surprised by is procurement spend. One of our newest clients buys steel from different manufacturers around the world, and through the use and management of virtual cards, they’ve been able to reduce the type of paperwork that purchase orders require. When we built the card management experience on our platform it was with different use cases in mind, including for payments to consultants and for regular T&E. Right now … we’re also seeing virtual cards distributed for relocation costs.

BTN: Are you seeing an increased interest overall from bank issuers of corporate cards in distributing their virtual cards through platforms like yours? Do you plan to add additional issuer partners?

Chung: Yes, we do plan to add more bank issuer partners. We’re seeing a lot of interest from various potential banking partners and we’re uniquely positioned to collaborate as we’re not a card issuer. [Instead,] we work with existing commercial card products. … We serve as kind of a “Switzerland” of cards, and we’ll continue to partner and integrate bank issuer virtual cards into our expense solution.

BTN: Along with the TMC partnership route, are you still focused on reaching clients directly as well? What’s the activity been like on that front?

Chung: Yes, we are still focused on our direct-to-client channel. We’ve doubled our customer base during the pandemic and signed on clients across a number of industries. At the beginning of the pandemic, our customer service and sales teams were heavily focused on re-educating our existing clientele on TravelBank’s new offerings and renewed the majority of our customers’ subscription contracts well before they expired.

BTN: When offering your platform through a TMC, what types of customization can you offer to meet those partners’—and, in turn, their clients’—specific needs?

Chung: In addition to customizing the logo and branding on the front end for our partners, we can also connect to a TMC’s GDS system so they can continue to leverage their own ARC and IATA statuses. … We’re flexible and can configure our platform on a per-TMC, and sometimes even per-customer, basis to fit their needs. We’re focused on providing a seamless experience for [TMCs’] customers, and sometimes that also includes integrating only one side of our platform if a customer selects a different vendor for travel or expenses.

BTN: Can your platform integrate with other, existing proprietary services these TMCs might otherwise be offering their clients already? For instance, I know Adelman recently launched a pre-trip approval service. Can that function work with the booking tool you’ve built for them?

Chung: We can integrate our partners’ existing proprietary services within our OBT where appropriate. However, if we already include the service, [such as] pre-trip approvals or duty of care, then we would become a turnkey solution for their new customers moving forward.

The pandemic showed us that the TMC industry cannot rely on a transaction-based pricing model only. We were the first to introduce a flat subscription service user fee for an all-in-one expense and travel solution and believe the rest of the industry will follow.”

BTN: Under the Adelman deal, your platform is being offered on a per-user, per-month subscription pricing model. We’ve heard a lot about how the sudden stoppage of travel last year may affect prevailing pricing models for booking, and specifically could drive a move away from transaction-based pricing. What’s your view on what pricing model will prevail in the post-Covid world?

Chung: The pandemic showed us that the TMC industry cannot rely on a transaction-based pricing model only. We were the first to introduce a flat subscription service user fee for an all-in-one expense and travel solution and believe the rest of the industry will follow. The subscription pricing model presents clear value to financial decision-makers and users. Right now, CFOs are looking to consolidate the vendors and software they use. … In the past, I’ve spoken about the consumerization of business travel, [offering] more design-focused experiences and easy-to-use apps and the subscription pricing model is yet another result of that. The way a user knows the value they’re getting when they sign up for a Netflix or Spotify subscription, business users want one easy-to-understand price from the platform.

BTN: What’s next for TravelBank? Are there any areas you’re particularly excited about or focused on for the year ahead as travel hopefully resumes?

Chung: In addition to our recent partnership announcement with Adelman, we also recently received our [ISO] security certification and have begun hiring again. This year, we’ll add new distribution partnerships, advance our data and AI capabilities and help lead the way for our customers in preparing for a safe return to travel. We’re in a unique position … where we can see rising problems and leverage our technology to solve them. For example, post-pay hotel reservations have been a huge problem in the travel industry, whereby having to fax in user itineraries to confirm a user arriving at a hotel can be checked in because they booked on a [virtual] commercial card. We were able to solve this by innovating on the expense and card side to enable any user to check in to their hotel with their mobile wallet tied to their commercial card.

BTN: Speaking of the resumption of travel, I can’t let you go without asking for your prediction on what that might look like. Do you see any significant recovery happening this year?

Chung: We will see some recovery in 2021, but more meaningful recovery will depend on a number of factors such as the speed and availability of vaccines. While vaccines are being distributed, we need to stay safe and continue to wear masks to reduce spread. I do think we’ll see an increase in business travel when it comes back. Now that more and more companies are announcing they’re going completely digital-first, it will lead to more people traveling for internal meetings and company meetups year-round.

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As Buyers Rethink Service Models, SalesTrip Touts Pairing CRM with T&E

Posted on March 3, 2021 | by getsetntravel | Leave a Comment

SalesTrip’s Manoj Ganapathy discusses:

The value of a subscription pricing model
Shifts in travel evaluation due to the pandemic
The potential allure of a CRM platform to TMCs

An industrywide re-evaluation of corporate travel and expense management service models could well be among the most transformative long-term effects of the Covid-19 pandemic. The sudden outbreak of the virus a year ago laid bare weak spots and inefficiencies in traditional structures, while the subsequent shutdown of travel gave corporate buyers the opportunity to step back and re-evaluate foundational aspects of their T&E programs.

That openness to change could be a ripe opportunity for providers operating outside of the traditional travel management company-centric paradigm. One such model, which had been gaining ground even before the onset of Covid, situates some corporate travel operations within the framework of customer relationship management (CRM) systems.

That’s the foundational principle of SalesTrip, a booking and expense management tool that operates within CRM behemoth Salesforce. Launched in 2019, the London-based company has scored clients on both sides of the Atlantic and in January closed a seed investment funding round. SalesTrip founder and CEO Manoj Ganapathy spoke with BTN payments and tech editor Adam Perrotta about the advantages of uniting T&E with CRM, and his vision for how that model will thrive in the post-pandemic landscape.

BTN: Despite the fact that corporate travel activity largely has been at a standstill for most of the past year, SalesTrip has added new customers over that time. From your perspective, to what extent was that driven by companies taking the opportunity to re‐evaluate their approach to travel and expense during that downtime, when there wasn’t any actual travel to support?

Manoj Ganapathy: For the most part, we have seen demand from companies looking for ways to better understand their employees’ discretionary spend. The significant downturn in travel has allowed them the time to do this, [and] accelerate the consolidation of the data silos still prevalent in corporate travel. And, as part of companywide cost-cutting initiatives, they’re no longer willing to accept [paying for] travel as the cost of doing business, and instead are shifting to understanding what the tangible outcome of travel spend is. They want to know the real impact a trip will have … and exactly what future revenue can be expected as a result of the travel.

BTN: Building travel and expense capabilities within Salesforce offers a value proposition when it comes to tying expenditures to sales and calculating ROI for business travel. Are there any other advantages to that model?

Ganapathy: There are many, including the ability for companies to create a branded user experience {to drive] employee engagement, and the use of dynamic or situational workflows, such as releasing a travel budget when a sales deal reaches a certain stage. But the most important is the ability to predict future travel volumes and spend. As SalesTrip [measures] travel booking and expense management against specific business activities … customers are able to analyze how much travel was required at different stages of the sales lifecycle. It’s then possible to predict the probability of success for future trips. Lastly, given Salesforce is a [software-as-a-service] platform, customers benefit from the predictability of a subscription pricing model. We don’t charge transactional booking fees, so customers aren’t faced with fluctuating costs depending on the volumes of travel. Right now, with business travel grounded, that isn’t such a concern. But when it resumes, the last thing a finance leader needs are high and unpredictable costs.

BTN: What effect has Covid‐19 pandemic had on the needs and wants of your customers when it comes to travel and expense? How are you positioning yourself to meet those new demands?

Ganapathy: The needs of our customers have simplified in that we’re not seeing requests for high-touch travel services. As such, the demand is from very practical buyers who wish to know the why behind spend. … This is really the foundation of SalesTrip, and so we’re well-positioned to meet these demands.

The laser focus on costs forced by the pandemic will shift the future of travel away from that costly [transactional] model and towards the more flexible subscription model.”

BTN: How central of a role can a CRM‐based service model play for a company’s travel operations? Can this model replace a traditional TMC—even for larger companies—by providing the full array of necessary “TMC‐like” services?

Ganapathy: We’re a licensed travel agency in several countries so [we can] serve as a TMC, meaning there is no need for customers to commission a separate service. We are not, by design, a high-touch TMC, however, so we understand that some customers might want to retain existing relationships with the more traditional TMCs. We’re flexible to these needs, and a small percentage of our larger customers use another agency for their ticketing and offline service. But it’s no secret that the fees these traditional TMCs charge are, for the most part, unjustifiable. Charging online booking fees for something which is by definition self‐service can rub buyers the wrong way. As a result, the laser focus on costs forced by the pandemic will shift the future of travel away from that costly [transactional] model and towards the more flexible subscription model.

BTN: On the other side of that, it seems like the CRM ecosystem/channel also could be an attractive avenue for traditional TMCs to reach clients, including smaller companies that don’t yet have managed travel programs. Have you seen interest from traditional TMCs in this space, and if so, what competitive advantage do you have over those providers in this context?

Ganapathy: Our previous research revealed that 80 percent of travel spend is incurred by [companies’] commercial teams. That same 80 percent live in CRM systems, using them on a daily basis. The potential reach is clear to see, and combined with the scalability of a cloud platform, represents a significant channel. We knew this when founding the company, and the more progressive TMCs see the exact value we provide that can augment their own offerings. Combining the services of a TMC with direct travel booking and expense management via the CRM platform offers clear advantages to the customer, not only for ease of use but also in cost savings. It’s not easy to connect the transaction-built world of the travel industry to a … highly customized modern CRM system, but there was a clear need for it, and is exactly why SalesTrip was founded.

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