TRAVELLING FOR BUSINESS OR FOR LEISURE

BUSINESS TRAVEL & TOURISM

B

usiness travel is a growing element of the overall travel and

tourism industry.

I

t is thought to be worth more than £16 billion annually.

I

n 2001, spending by business visitors exceeded that of leisure

visitors.

B

usiness travel and tourism includes

a wide range of events and services.

BUSINESS TRAVEL CHARACTERISTICS

High quality, high yield (earns more revenue) part of travel and tourism.

Lengthens the high season for leisure tourism destinations in UK.

Year-round sector means more full-time jobs.

More ‘shock-proofed’ against downturns or disasters.

Investment can regenerate urban areas.

THE COMPONENTS OF BUSINESS TRAVEL

Conferences and meetings are worth over £7 billion in 2003. This part of the sector includes:

sales conferences

management meetings

annual general meetings

training courses

business presentations and product launches

THE COMPONENTS OF BUSINESS TRAVEL

T

he market for exhibitions and trade fairs is worth over £2

billion per year.

T

rade exhibitions are for buyers and sellers in specific trade

sectors.

P

ublic exhibitions attract paying members of the public.

T

rade/public exhibitions aim to attract both types of visitor.

THE COMPONENTS OF BUSINESS TRAVEL

Incentive travel is used by organisations to motivate their staff.

Travel rewards cost between £500 and £5,000 per head.

They are usually offered in industries with high profit margins such as cars and financial services.

Qualification for incentive travel is based on achieving agreed goals (usually sales targets).

THE COMPONENTS OF BUSINESS TRAVEL

Corporate events include staff and client entertainment.

Sporting occasions are the most popular for corporate events.

Close links exist between corporate events segment and the contract catering industry.

Market worth between £700 million and £1 billion per year.

THE COMPONENTS OF BUSINESS TRAVEL

The outdoor events segment brings together local authorities, show organisers, event management firms, promoters and venues owners.

With…

Equipment and services firms, consultants, and entertainment agencies.

Putting on thousands of events across the country every year.

THE COMPONENTS OF BUSINESS TRAVEL

These first 5 segments of the industry are known as examples of ‘discretionary’ business tourism.

This means that the organisers have a choice over the destination of their events.

Corporate travel is a ‘non-discretionary’ segment.

This means there is no choice over where it takes place.

THE COMPONENTS OF BUSINESS TRAVEL

C

orporate travel is a £6 billion

annual market.

O

verlap with all other segments of the business travel and

tourism industry.

M

ay involve travel by air, rail, coach, car and sea.

C

an lead to individual and family travel beyond the business

segment.

BUSINESS TRAVEL AGENCIES

Business travel agencies share many characteristics with retail travel agencies:

They can be trans-national businesses, national organisations and independent companies.

They may offer a mix of business and leisure travel services.

They have been affected by the rise of internet tourism distribution.

ISSUES IN BUSINESS TRAVEL

Again, many of these are the same as those faced by retail travel agencies:

C

uts in commission paid

to travel agents.

N

on-commission fees for travel agents.

T

he rise of the low-cost airlines.

D

irect sales to customers

via the internet.

CONCLUSION

B

usiness travel is a highly valuable part of the travel and tourism

industry.

N

ot only does it continue to grow, but average spending by

business travel customers is higher than in the retail sector.

V

enues and cities compete through ‘place marketing’ to appeal

to customers in the sector.