The Road Ahead
This story appears in the December 2000 issue of Entrepreneur. Subscribe »
If you travel a lot, you'd probably rather forget 2000. Airline passenger complaints and flight delays reached record levels. Plus, prices for nearly every travel-related consideration climbed.
Will 2001 be any better? Maybe, maybe not. Anna Magliacano, a senior travel analyst for ShareMax in Parsippany, New Jersey, predicts the hotel business will experience its "highest level of profitability in more than a decade" next year, thanks to higher room rates.
According to Runzheimer International senior consultant Rolfe Shellenberger, travel costs will escalate next year. "This is the biggest increase we've forecast in 20 years," he says, blaming the changes on a projected rise in inflation and suppliers trying to "get more yield from fewer customers." An example: Airlines offering more legroom have smaller passenger capacity. Therefore, they charge more to realize the same revenue per plane.
Shellenberger says business owners aren't powerless to prevent their expenses from ballooning out of control. By carefully monitoring travel-related expenses and taking advantage of advanced-fare purchases, businesses can beat the high prices.
But the news isn't all bad. Along with rate hikes, expect innovation in the travel industry. For example:
Improved travel Web
sites. Peter M. Sontag, who runs LowAirfare.com,
believes more Internet travel businesses will emulate his model of
integrating live agents and online interfaces. "People are so
frustrated with the Expedias and Travelocitys of the world, where
you have to follow their patterns and do what the computer
says," observes Sontag. "Internet users want something
where they can go back and forth between a person and the
Web."
Card games. What about
those long-expected smart cards? This could be their year, suggests
Walter Sanders of Diners Club. He says the technology is available
to store everything from airline seat preferences to travel
policies on a card-based microchip, but the market has been slow to
embrace it. "It's a slow evolution," he says,
"but I'd expect to see more smart cards in 2001."
Wireless action. Rick
Collins, who directs United Airlines' e-commerce marketing
efforts, thinks wireless applications are moving to a common
platform-meaning it'll be easier for cell phones, personal
computers and other computing devices to communicate with one
another. "In 2001, users will get information wirelessly and
interact with it," he predicts. "You'll be able to
track luggage, book and re-book a flight, or get paged with a
flight's status."
More niche sites for business
travel. Delta Air Lines is offering business travelers a
service called MYOB (Mind Your Own Business, www.myobtravel.com) travel.
"It offers a full-scale online travel agency for businesses,
with access to air, car and hotel services and profile-driven
booking in three mouse clicks or less," says Jackie Yaney, a
consultant and business partner on small-business travel for the
Atlanta-based carrier. Sites such as Trip.com and Rosenbluth
Interactive's biztravel.com already offer similar services.
Expect more in the coming year.
No one knows the future. But to paraphrase Charles Dickens, 2001 could be the best of times and the worst of times.
Christopher Elliott is a writer in Annapolis, Maryland. Contact him at www.elliott.org.
Contact Sources
- Diners Club, (800) 2-DINERS, www.dinersclubus.com
- ShareMax, (973) 884-6000, www.sharemax.com
- United Airlines, www.united.com
