The world of business travel is constantly evolving. Influenced by tech trends, political happenings and everything in between, the global corporate travel landscape in the 21st century has changed beyond recognition. Companies in both North America and Europe have had a major influence in the shape of modern business travel, but the space isn’t exactly the same on the two continents. We’re taking a look at how travel management and the experience of the business traveler differs between the two continents. What effect will the US and Europe have on the future of corporate travel?

The rise of the smart business traveler

Nowadays, a smartphone is just a notch below a passport on the travel essentials list. Not only is the trusty mobile a must-have device for everyday life but, for the modern business traveler, it functions as an indispensable business tool. From scheduling meetings, checking emails and keeping track of flight times, to booking intercity travel and accommodation, the smartphone is multifunctional. Put simply, it is the business traveler’s best friend.

When it comes to using smartphones for booking flights and accommodation, Europe leads the way. More than 60% of business travelers in the UK, France and Germany use a mobile device to shop for or book a flight or accommodation.

One key difference in smartphone use is the adoption of 'bring your own device' (BYOD) in the US. Many companies in Europe still prefer to provide a company mobile, meaning employees travel with two – obviously an inconvenience, although easier for companies to promote policy compliance. Through BYOD, US companies have less control over which apps are used, making policy compliance more difficult. This is why more and more US companies are looking towards all-encompassing travel tools, designed to incorporate all travel functions and stay on-policy.

Safety, security, and duty of care

With an increased focus on travel safety and security in recent years, companies throughout the US and Europe have had to adapt their approach. Technological advances have enabled business travelers to be tracked by their companies, a trend particularly prevalent in the US and a key feature of Airbnb for Work.

In Europe, extra duty of care legislation means that companies have a greater responsibility to make sure their employees are safe when traveling for business. This could be an obstacle for Airbnb’s plan to dominate the European business accommodation market, as their lack of regulation and security becomes a nightmare for travel managers tasked with overseeing duty of care and risk management.

While duty of care is important for companies stateside, they tend to focus more on the comfort of their business travelers and the overall experience.

Business traveler preferences, cost efficiency and policy compliance

For companies in the US and Europe, cost efficiency and policy compliance are still fundamental aspects of managed travel programs. A successful program should provide a platform that consistently gives the business traveler a great experience. But how to balance this with cost efficiency and staying on-policy?

According to independent travel research group Phocuswright, millennial business travelers in the US are more likely to book out of channel than in Europe. Although this could be cost-effective – millennials are leading the shift towards the sharing economy typified by Airbnb – it creates complications with compliance. This has led to the adoption of 'open-channel booking’ by certain high-tech companies in the US, where business travelers are free to book through any channel as long as they stay within budget. In Europe, where duty of care and expense control are major factors in travel programs, open channel bookings haven’t caught on as quickly.

Language, currency and transport

Business travelers in the US have life made easier by a less complex market structure. With one language, currency and market culture, fewer content providers and lots of domestic point-to-point flights in the US, many aspects of business travel are much simpler in the states.

In Europe, major players in the international market are on each other’s doorsteps. The UK, France, Germany and Spain are only separated by a short flight and, with many budget airlines offering low cost deals throughout Europe, business travel is inexpensive and convenient. In contrast, a flight from coast to coast in the US takes over six hours. This gives a completely different flavor to the business travel experience, with long-flight considerations a major factor in the US.

Europe also has an excellent, low-cost intercontinental rail network, giving business travelers a completely different, less stressful (no airport security lines!) travel option. Due to its open landscapes and sheer size, in the US rail travel for business is not ideal. Cheap fuel makes traveling by car the best option for short business trips, whereas air travel is the only option for cross-country journeys.

Differences throughout Europe

With so many differences between its inhabitant countries, whether economic, historical, cultural or political (Brexit … sigh), Europe is a complex business landscape. When it comes to business travel, priorities and perspectives vary greatly.

Germany

Europe’s undisputed economic powerhouse, Germany, is the largest business travel market in Europe. However, its economy relies heavily on pre-internet industry, meaning many companies have been hesitant when it comes to embracing new technology and methodology.

In a bid to add balance, its key business city, Munich, has become a hub for technological innovation and is a pioneering smart city, looking to revolutionize travel infrastructure in and around the city. This has created a buzz with young entrepreneurs and startups, while changing Germany’s stance on business travel. Last year, Munich’s tourism industry generated €7.8 billion.

Renowned for efficiency, German companies have typically favored a cost-effective, balanced travel policy, with high policy compliance. With excellent low cost transport and well-managed travel programs, this has been achievable until now. But with German millennials making waves, companies will have to adapt.

UK

Despite the future of UK business and its relationship with the rest of Europe being uncertain, London remains a major hub for international business and a city of innovation. Because of this and despite the potential effects of Brexit, the UK will most likely continue to be at the forefront of redefining the business travel experience.

The next few years will be key for UK business travel. An added emphasis on cost-effectiveness will counterbalance the economic impact of Brexit, with companies looking to online travel tools and alternative accommodation platforms. With a willingness to embrace the changing nature of business travel, UK companies will be looking to lead innovation in an increasingly connected world.

Spain

With the most competitive tourism industry in the world and with a growing international business presence in Barcelona and Madrid, corporate travel in Spain is taking off. Boasting a burgeoning startup scene brimming with young, innovative entrepreneurs, Spain is at the forefront of the changing nature of business and looks set to lead the change in the corporate travel experience.

Barcelona, in particular, is gaining a reputation as one of Europe’s major cities for innovative thinkers, and business travel policies will start to reflect this. Leading startups such as ID Finance, Glovo and Typeform are growing in reputation and expanding across Europe and the rest of the world. An emphasis on ingenuity, flexibility and the business travel experience from the millennial point of view is beginning to underpin corporate travel management in Spain.

France

The French travel industry took a nosedive in 2016, with terrorist attacks in Paris and Nice as well as the economic crisis having a huge impact. Things have improved since then, with a slow and steady recovery, although the recent ‘gilets jaunes’ protests on the streets of Paris could prove to be a major setback.

Compared to other countries in Europe, French business travel has been slow to embrace the sharing economy. While Airbnb for Work took off across the US and other key countries in Europe, Paris sued the alternative accommodation giant for failing to respect local laws. If the French capital wins its case, Airbnb could be forced to pay €1000 - 5000 per day for each unregistered listing. And with a massive hotel boom forecasted in time for the 2024 Paris olympics, it looks like companies in France will continue to pursue traditional corporate travel management policies.

Having said that, the French might yet embrace the new wave of business travel. Air France is diversifying its flight offerings with ‘Joon’, a more affordable spin-off airline aimed at millennials, and the sharing economy is finally getting into gear, with car rental disruptors such as Zipcar and BlaBlaCar gaining stronger traction.

Business travel spend and annual growth

Let’s take a look at business travel spending and annual growth in the US and throughout Europe in 2017.

Country

Total business spending

Annual growth in business spending

United States

€257 billion

3.1%

Germany

€63 billion

5.6%

United Kingdom

€44 billion

-0.7%

France

€35 billion

3.9%

Spain

€19 billion

6.3%

Western Europe Total

€310 billion

4%

Global Total

€1.15 trillion

5.8%

Sources GBTA annual report and forecasts

Western Europe is slightly ahead of the US in terms of business spend and annual growth. Interestingly, Spain is the only country in Western Europe ahead of the average rate of global growth. Predictably, the UK is the only major country to have taken a backwards step.

Globalization and its effect on business travel

Technology has transformed the global managed travel landscape. Today, the business traveler is wired into the online world, while at the same time looking for a more immersive real-world travel experience.

Due to the lay of the land and ingrained culture, certain differences between North American and European business travel will always remain. However, while there are differences between travel management policies and trends throughout the US and Europe, the global market is more connected than ever before. Business trends travel fast and, with companies increasingly driven to outpace the competition, innovation is spreading at an unprecedented pace.