The 2023 has been like a roller coaster for various organizations worldwide. There was a rise in inflation and two ongoing wars: The Russia-Ukraine war and the Isreal-Hamas war. These events heightened geopolitical tensions, which impacted the world economy. Despite all these challenges, business travel continued, with employees traveling domestically and internationally.
As we kick off 2024, business travel will continue to grow as global travel prices are predicted to increase. According to the latest 2023 GBTA Business Travel Index Outlook – Annual Global Report and Forecast, the global business travel industry has rebounded faster than expected just a year ago. It is expected to surpass the pre-pandemic spending level of $1.4 trillion in 2024 and will continue to grow to nearly $1.8 trillion by 2027.
Hence, companies are preparing to take better approaches to business travel for 2024, which means there will be new trends and changes.
Let us look at the 5 key trends shaping business travel in 2024:
1. Sustainability Will Continue to be the Primary Focus
Over the past few years, we’ve seen how a global crisis can suddenly halt travel. Although the pandemic remains front of mind, another crisis will bring even graver consequences for humanity and imperil the destinations we love. That threat is climate change.
According to NASA, changes to the earth’s climate due to increased human activities such as deforestation and the release of greenhouse gases are already having several adverse effects on the environment. More release of these greenhouse gases means more extreme climates and widespread damage across the planet. Business travel alone is one of the most significant contributors to global warming and climate change.
To keep the planet from warming more than 1.5°C above pre-industrial levels, most countries, including the U.S., aim to reach net zero by 2050. Renowned organizations such as Mckinsey have implemented carbon fees on air travel since January 2023. The carbon fee adds transparency and accountability to travel decisions and, by funding investments to accelerate the global transition, supports the firm’s aspiration to be the most significant private-sector catalyst for decarbonization.
Additionally, the recent COP28 summit held in Dubai, UAE, saw over 50 companies representing more than 40 percent of global oil and gas production come together in Dubai, committing to net-zero operations by 2050 across Scope 1 and 2 emissions, zero methane in upstream operations by 2030, zero routine flaring by 2030, and increased transparency in emissions reporting. For more than 30 of them, the move marked their first commitment to near-zero methane.
Therefore, business travel trends involving low-carbon travel will gain more focus in 2024.
2. Business Travelers will Prefer Personalization
Statistically, 1.3 billion business trips are taken daily in the United States alone. With such frequent travels, business travelers prefer to travel according to their interests and seek comfortable experiences. This need has given rise to one of the latest trends – personalization. Their expectations shift as business professionals traverse the globe for meetings, conferences, and networking opportunities. Gone are the days of standardized accommodations and one-size-fits-all services. Today, discerning business travelers seek a personalized experience catering to their unique preferences and requirements.
The advent of technology and data-driven insights has significantly fueled this shift. Personalization plays a crucial role when a traveler begins planning their business trips. Travel platforms and applications such as travel management software utilize advanced algorithms to suggest tailored itineraries, recommend accommodations based on previous stays, and offer curated experiences aligning with individual preferences.
Consider a scenario where a traveler intends to reserve a flight from London to Amsterdam. Through personalization, the traveler could be instantly offered the flight they are most likely to book at the best price at the top of the search results. If, for instance, the traveler prefers Friday departures at 10 am, personalization streamlines the process by showcasing the ideal flight, eliminating the need to spend excessive time scrolling through multiple pages to find exactly the right flight.
Integrating technology, data-driven insights, and a customer-centric approach enables organizations to deliver personalized services that enhance the travel experience and increase productivity and satisfaction among business travelers. As this trend continues to evolve, companies prioritizing and excelling in personalization will undoubtedly stand out in the competitive landscape of business travel.
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3. Group Travel is on the Rise
While individual trips for meetings and conferences have long been the norm, a growing trend is the rise of group travel among professionals. This trend isn’t merely about traveling together but embodies a deeper connection-driven approach that fosters collaboration, networking, and shared experiences.
Today’s professionals acknowledge the immense value of building networks and forging partnerships beyond conventional meeting rooms and corporate settings. As a result, group travel has gained momentum as a strategic means to cultivate stronger relationships, brainstorm ideas, and explore collaborative ventures.
Group travel has not only become more popular but also become a necessary part of business operations. There were 12 million more group hotel room nights booked worldwide in 2023 compared to the same time in 2022, an increase of 18%, according to Amadeus Demand360 data. And according to GBTA predictions, annual business travel spend will surpass pre-pandemic levels by the end of 2024, and a significant driver of that will be group travel and events like offsites, team-building, and conferences.
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4. Increased Use of Managed Travel Programs
In the ever-evolving landscape of the US economy, businesses are continuously seeking innovative ways to navigate financial challenges and tighten their fiscal belts. One significant area where companies are increasingly focusing their attention is travel expenditure.
Amidst economic turbulence and fluctuating interest rates, companies reevaluate their expenses, including travel-related costs. Managed travel programs have emerged as a beacon of efficiency, offering a structured framework to monitor, control, and optimize travel expenditures.
Most companies in the US, from small businesses to mid-sized companies to large companies, are opting for managed travel programs. Managed travel means working with a travel manager or Travel Management Company to ensure that your travel policies are being adhered to and that you get the most considerable ROI possible from your business travel. You can be assured that with a managed travel program, you can optimize your travel costs, enhance control and visibility, streamline the booking process, ensure compliance, mitigate risks, and much more.
Hence, with such a multitude of benefits, it is no surprise that people will move to managed travel programs to establish more interest in their travel costs. This shift reflects a proactive stance in the face of economic volatility, setting the stage for a more controlled and financially sound future for businesses across various industries in the United States.
5. Flight and Hotel Costs Will Continue to Go Up
Global business travel and events costs are set to climb higher throughout 2024, although at a much more moderate pace than the exceptionally steep increase seen in 2022 and 2023. According to Business Travel Europe, the global average flight ticket price reached $749 and $766 in 2023 and is expected to increase by another 1.8 percent in 2024 to $780. This is mainly due to rising fuel prices, inflation, and labor shortages, among many others.
As per the Energy Information Administration (EIA), jet fuel prices averaged $3.07 per gallon at the end of August 2023, up 50% from a recent low of $2.05 in early May. This has come alongside a surge in crude oil prices, which have risen to their highest in almost 10 months. However, Amex GBT’s Air Monitor 2024 expects only international airfares to drop in 2024 — notably for flights such as Alaska Airlines or Delta Airlines between North America and Asia. The report states regional fares will remain stable or slightly increase.
Meanwhile, the average daily rate (ADR) for hotels went up 2 by 4.3 percent in 2023 to $168 and is expected to increase by 3.6 percent to $174 in 2024. With the increase in employees and executives traveling globally for business purposes, global hotel rates are also expected to increase immensely. Instead of filling every room, hotels may be more willing to accept lower occupancy, limiting availability and charging higher rates. With high inflation in many countries, this priority change has the added benefit of lowering hotels’ operating costs.
Make Business Travel Seamless with ITILITE
2023 passed with a lot of uncertainty. However, 2024 looks very promising for the business travel industry. Sustainable travel, personalization, group travel, managed travel programs, and increased flight and hotel prices will continue to be business travel trends in 2024 and the future.
With companies across the globe constantly struggling with cost leakages, managing group travel, last-minute bookings, cancellations, etc., an exceptional solution such as ITILITE can help you. ITILITE is an advanced cloud-based travel and expense management software that allows you to manage your travel and expenses seamlessly. We provide round-the-clock support, reports to track your carbon footprint, manage group travel, free cancellations, personalized booking options, and many more. Moreover, with our flight ticket ReShop feature, you can book flights much cheaper when flight prices drop.
Get a free demo of ITILITE to try the features yourself.
