Is right

The price

The Business Travel Magazine - - The Review -

Rail travel re­mains the poor re­la­tion to ho­tels and air in terms of spend man­age­ment. It is equiv­a­lent to how meet­ings spend was viewed un­til not too long ago, but slowly it is play­ing catch-up, spurred on by the gov­ern­ment’s aim to sim­plify ticket types.

The Rail De­liv­ery Group’s (RDG) mis­sion is to roll out tick­et­less tech­nol­ogy by in­tro­duc­ing e-tick­ets and m-tick­ets and erad­i­cate the bulk of pa­per or­ange tick­ets by 2020. The tar­get is for 70% of all tick­ets to be ful­filled by dig­i­tal tick­et­ing by 2020.

Few be­lieve that dead­line will be met as the train op­er­at­ing com­pa­nies have been slow to re­spond. The brake on progress is the length of the fran­chises granted to the train op­er­at­ing com­pa­nies; too short to al­low suf­fi­cient prof­its to be ploughed back. Ticket bar­code scan­ners at sta­tions are still not wide­spread; get­ting re­funds on e-tick­ets are still a chal­lenge, and so on.

Cur­rently, pas­sen­gers on Vir­gin West Coast can cre­ate an e-ticket on Ad­vance fare types, de­liv­ered as a PDF, while East Coast doesn’t sup­port e-tick­ets but does of­fers m-tick­ets ac­cessed through an app, but they must be ac­ti­vated pre-travel and it can­not be printed.

Train­line and Evolvi's book­ing tech­nol­ogy has trans­formed rail spend man­age­ment. Evolvi, for ex­am­ple, al­lows mul­ti­ple sub sets of poli­cies, good data col­lec­tion and cost at­tri­bu­tion. Book­ers can com­pare peak and off-peak fares and see the dif­fer­ence in price be­tween an open re­turn and two sin­gle Ad­vance tick­ets, which can of­ten be cheaper.

De­spite an­nual fares rises – 3.9% this year – the av­er­age ticket value across the Evolvi book­ing plat­form has fallen, from £59.03 in 2013 to £56.82 in 2017, and is tes­ta­ment to the abil­ity to man­age rail spend.

“The key to mak­ing sav­ings is to drive com­pli­ance,” says Gary Mcleod, Man­ag­ing Di­rec­tor at Trav­e­leads. “Be proac­tive and en­sure that trav­ellers are not go­ing off-pol­icy or do­ing their own book­ing.”

Mcleod reck­ons the av­er­age sav­ing they can demon­strate, when a client moves from un­man­aged to a man­aged frame­work, is 20%. “It’s quite eas­ily achiev­able,” he says.

Chris Vince, Di­rec­tor of Op­er­a­tions at Click Travel, says it can be as high as 25% by putting in guide­lines. “Buy­ers can def­i­nitely man­age rail as ef­fec­tively as ho­tel and air as there are quick, easy wins,” he says. ”There is low-hang­ing fruit to go for.”

The com­plex­ity of rail fares can make spend man­age­ment hard work, writes Gil­lian Up­ton, who ad­vises on best book­ing prac­tice

The next step is man­dat­ing the book­ing chan­nel in or­der to col­lect data and get vis­i­bil­ity of spend from the man­age­ment re­ports. Sav­ings can be­gin from chang­ing be­hav­iour and the key mes­sage is to book early to ac­cess the cheap­est fares.

The op­ti­mum time to book is 14-16 days out, while trav­el­ling af­ter 9am and af­ter 7pm on week­days mas­sively cuts costs. Book­ing a meet­ing at 11am rather than 9am can eas­ily save 50% on the fare price. “Ed­u­cate trav­ellers to look at the fares be­fore they ar­range the meet­ing,” says Mcleod. “Clients don’t mind if you shift a meet­ing back by an hour to save money.”

Ro­bust com­mu­ni­ca­tion is key and clients can cre­ate prompts on the log-in screens to book early. The one ticket type to avoid is an open re­turn ticket. “Some 80-85% of jour­neys hap­pen as booked so there is no need to book an open re­turn ticket,” says Mcleod.

The on-the-day Ad­vance tick­ets, in­tro­duced by Cross Coun­try and Vir­gin, can ac­crue sav­ings but their avail­abil­ity is lim­ited. There are still a hand­ful of train op­er­at­ing com­pa­nies who do not of­fer them, namely Ar­riva Trains Wales, South West Trains, South­ern, South­east­ern, Sco­trail and GWR.

By far and away the cheap­est rail tick­ets to buy are the Ad­vance tick­ets where the ex­act time and date of travel are stip­u­lated. Lone Kon­rad­sen, Head of Con­sult­ing Ser­vices at Capita Travel and Events, says: “Book­ing a spe­cific train could save you 44% on the cost of a full any­time sin­gle.”

Tac­ti­cal tick­ets Mean­while, the jury’s out on split tick­et­ing where a trav­eller di­vides their jour­ney into a num­ber of sep­a­rate tick­ets. For ex­am­ple, on a Lon­don Kings Cross to Leeds jour­ney it could en­tail buy­ing one leg be­tween Lon­don to Don­caster and an­other be­tween Don­caster and Leeds. More well-known is the Did­cot Dodge on West coun­try jour­neys such as Lon­don-bris­tol. Split tick­et­ing sav­ings can be in the range of 15-20%. “I’d ques­tion the value of it,” says Mcleod. “The sav­ings are not mas­sive and the time spent do­ing it is not nec­es­sar­ily worth­while. Plus, you have to move half­way through the jour­ney and you’re not guar­an­teed to get the same seat.”

Imelda Aspinall, UK Travel Man­ager & Group Co­or­di­na­tor at MBDA, says it’s dif­fi­cult to in­clude split tick­et­ing op­tions on a book­ing plat­form so has parked the idea for now. “A few book­ers are savvy and book them but they do have to in­vest time in do­ing it,” she says. More­over, the train op­er­a­tors are busy erad­i­cat­ing these loop­holes.

First class think­ing The jury is out over first class travel, although its ap­peal en­dures. With its ex­tra space to work, more pri­vacy, free teas and cof­fees and wifi in­cluded in the fare, this is where the mul­ti­ple travel poli­cies take hold.

There are many com­pa­nies who dic­tate stan­dard fares across the en­tire pop­u­la­tion of trav­ellers and have a to­tal ban on first class, but oth­ers who have one pol­icy for 90% of the work­force and an­other for the re­main­ing 10%.

But who are the 10%? Across Capita Travel and Events’ cus­tomer data as a whole, around 12% of rail tick­ets pur­chased are in first class, but once you take out

pro­fes­sional ser­vices and le­gal firms from  the mix, that fig­ure drops down to 2%. “It’s gen­er­ally rev­enue-gen­er­at­ing em­ploy­ees us­ing first class, and not al­ways nec­es­sar­ily the top earn­ers,” says Kon­rad­sen.

First class is un­de­ni­ably a good prod­uct and the case for im­proved pro­duc­tiv­ity is strong, says Click's Chris Vince. “Ad­vance first class tick­ets are of­ten the cheap­est op­tion if you look at to­tal travel cost and add up the cost of the cof­fee, ba­con roll and wifi. We rec­om­mend a tol­er­ance level in the pol­icy – an ex­tra £10 might let them up­grade and be more pro­duc­tive.”

Trav­ellers at MBDA, for ex­am­ple, are per­mit­ted to pur­chase Ad­vance first class tick­ets if they are cheaper than stan­dard tick­ets on the day of travel.

Some com­pa­nies are util­is­ing data an­a­lyt­ics to find the ROI of first class over stan­dard class. If a trav­eller is able to work one more hour in first than in stan­dard class on Lon­don-manch­ester, for ex­am­ple, then “you don’t have to be earn­ing much more be­fore that ticket is paid for,” says CWT’S Har­man.

Do­ing a deal Aside from ed­u­cat­ing trav­ellers on ticket types and the times of meet­ings, buy­ers can ap­proach the op­er­a­tors to ne­go­ti­ate soft ben­e­fits. Suc­cess will de­pend en­tirely on your vol­ume of spend. It’s worth­while ap­proach­ing them if your rail spend is over £100,000 a year. It will also de­pend on your routes: those with more com­pe­ti­tion, such as Birm­ing­ham-lon­don where there are three train op­er­at­ing com­pa­nies, are more likely to ne­go­ti­ate.

Capita sug­gests try­ing for a deal on those routes where there is modal com­pe­ti­tion be­tween air and rail. Some TOCS will of­fer a deal to the TMC as a re­ward, or to Evolvi, rather than on a per client ba­sis.

“My mes­sage would be, if you have a rea­son­able amount of spend with a train op­er­a­tor then ap­proach them and ask,” says Me­lanie Glass, Head of Client Ser­vices at Evolvi. Adds HRG'S Ian Wind­sor: “If you don’t ask, you don’t get. Lon­don-manch­ester is a re­ally busy route so there is no rea­son to give any­thing away, but on Lon­don-scot­land there is more scope.”

An­other strat­egy is to take ad­van­tage of emerg­ing tech­nol­ogy such as price track­ing, ad­vises CWT’S Har­man: “Firms like Yapta are well es­tab­lished and work with busi­nesses and TMCS to find sav­ings through au­to­mat­i­cally track­ing flight and ho­tel prices but there’s also sim­i­lar tech­nol­ogy for rail.

“Train­line now of­fers a price pre­dic­tion tool al­low­ing busi­ness trav­ellers to track the price of Ad­vance tick­ets through its app,” she says.

Putting it into prac­tice One travel man­ager try­ing to take all this good prac­tice on board is Imelda Aspinall at MBDA. Hav­ing tack­led air and ac­com­mo­da­tion over the last three and a half years she is now turn­ing her at­ten­tion to rail. Aware that the com­pany loses out on MI as there is no man­date to use their TMC for rail book­ings, the first change will be the im­ple­men­ta­tion of an on­line book­ing tool later this year and to man­date its use.

MBDA'S em­ploy­ees travel be­tween four UK of­fices in Steve­nage, Bris­tol, Bolton and Lon­don as well as bases in France, Italy, Ger­many and Spain on a reg­u­lar ba­sis.

“Car hire is our ma­jor com­peti­tor to rail as our ma­jor sites are out of the way so we use an Avis im­plant,” says Aspinall. “We know we spent £1.4mil­lion on rail last year through the TMC but we also know that’s

only a frac­tion of the to­tal.”

Hav­ing had the free­dom to book what they want to date, her plan is to get the 100 or so travel book­ers on-side and she has al­ready cre­ated a fo­cus group of top users to start the process of change.

“The ques­tion ‘What’s in it for me?’ will al­ways be the main is­sue but once I have strong MI I'll start look­ing at ne­go­ti­at­ing soft ben­e­fits and those will be the re­wards. But first, TOCS want to know what vol­umes can be shifted,” ex­plains Aspinall. Both e-tick­ets and m-tick­ets will be re­quire­ments once the book­ing tool is im­ple­mented too.

“Rail is a dif­fi­cult nut to crack,” she says. “There are so many ticket types and it’s still very con­fus­ing. I think book­ing tools strug­gle some­times in pre­sent­ing rail as there are so many al­go­rithms to go for but I know that there are bet­ter so­lu­tions out there.”

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