According to recent reports in the London Financial Times (August 2023), business travel (as opposed to business events) has not yet recovered to pre-pandemic, levels. The reasons for this are called out in a nicely provocative headline ‘Business class revival stalls as premium flights cost more and carbon curbs bite’.
Average premium class airfare has risen from US$3,666 in 2019 to US$4,395, prompting one airline boss to say that the industry was now operating “in a world where business travel may not be coming back” (Robin Hayes, chief executive at JetBlue).
Multinational corporations – but not SMEs – according to AmEx, have been slow to bring back business travel, some cutting back on travel to reduce carbon emissions. But this, remember, is business travel.
The Covid years proved to corporations that some business meetings could be just as effective on-line as in-person. They also demonstrated, however, that some business meetings could NOT be effective unless they were in-person.
JetBlue’s Robin Hayes is probably over-stating it, but I think it is fair to say that business travel is unlikely to reach the high-water mark of 2019 and that, in the overall scheme of things, gives us a more sustainable model overall, both in terms of its enduring and its environmental characteristics.
So, business travel is below 2019 levels still but its sub-set, business events, is definitely not. When SITE surveyed incentive travel professionals during the Covid years, many stated it would be 2025 or 2026 before incentives would recover to 2019 levels. But now we know that is not what happened at all.
In truth, incentives were already exceeding 2019 levels in 2022 (mainly due to delayed execution of 2020 and 2021 programmes) but the upward trend has been maintained for 2023 and, according to early signs from this year’s Incentive Travel Index (2023), this is set to last into the future. Good news indeed.
“Business travel is below 2019 levels still but its sub-set, business events, is definitely not”
It’s good news for our industry at large but there’s an important underlying principle here that we need to be aware of, and to highlight at every available opportunity. That principle concerns how the corporate world understands, classifies and categorises incentive travel and corporate meetings.
For many companies, corporate meetings, events, incentive travel programmes and so on are classified as travel and, therefore, will suffer the same vicissitudes that travel will endure due to changing economic, and increasingly, attitudinal factors.
Corporate meetings and incentive travel programmes cannot, and should not, be reduced to mere ‘travel’ line items in the overall budget of a corporation. Their nature, purpose and direction are way more nuanced than such a reductive classification.
Corporate meetings, whether focused on updating, alignment or sales kick-offs are crucial on so many levels: overall staff and stakeholder engagement, alignment with corporate culture and values, fostering of connections.
Likewise, incentive travel programmes are not line items in corporate travel budget but strategic initiatives that drive sales, ensure staff retention, foster esprit de corps and model corporate culture.
The good news is that corporations appear to be recognising this and, while business travel stagnates, business events prevail.
Long may it be so!
