It is no secret that Covid-19 has had a huge impact on the world of travel and consequently on the business travel sector.

The last 18 months have been very difficult for all operators but, despite the likelihood of some restrictions being extended over the next few years, the good news is that we are witnessing the upswing of business travel, albeit in a different form than before pandemic.

In this article we gathered up some data and statistics – drawn up in collaboration between the World Travel & Tourism Council and McKinsey & Company – about the restart of business travel after the Covid-19 global lockdowns. Such information will help us understand how the restart of the sector will be, especially considering the scenarios that foresee the transition of the virus to an endemic status.

Slow recovery and changes compared to the pre-Covid-19 time

According to statistics about business travel published by Spendesk, with the arrival of the pandemic:

  • The business travel market expects to lose $ 810.7 million globally (Statista)
  • ⅔ of the world’s planes remained on the ground, 18 airlines signed for bankruptcy (McKinsey)
  • In the second quarter of 2020, American airlines reported a 90% reduction in business travel (McKinsey)
  • Travel managers have reported that travel expenses are between 5-15% compared to 2019 levels (McKinsey)

Business travel represents only 21.4% of global travel (compared to 2019) but it is still responsible for the highest travel expense to certain destinations and this is why the restart of the entire travel sector is crucial.

Before the pandemic, business travel was responsible for 70% of global revenue for high-end hotels while 55-70% of airline profits came from business travellers, who accounted for around 12% of passengers.  

Forecasts, restart by sector and region

Julia Simpson, CEO and president of WTTC, states: “Business travel is restarting. We expect ⅔ of the industry to restart before the end of 2022. Business travel has been hit hard but our research shows room for optimism with a restart in the Asia-Pacific and Middle East area as the first blocks.

According to data from the WTTC (World Travel & Tourism Council), with a loss of 61% in 2020 for the travel sector and despite the slow recovery, business travel expenses are expected to grow by 26% in 2021 and 34% in 2022. Below are the recovery data, for each individual region, for 2021 and 2022:

  1. Middle East – 49% for 2021, 32% for 2022
  2. Asia-Pacific – 32% for 2021, 41% for 2022
  3. Europe – 36% for 2021, 28% for 2022
  4. Africa – 36% for 2021, 23% for 2022
  5. America – 14% for 2021, 35% for 2022

But what elements should be considered for a real recovery? Many factors have an impact on the restart of business travel, for example:

  • Demand; business travel is slowly picking up compared to leisure travel due to continuous changes on restrictions and company policies in every single country and the consequent changes.
  • Digitisation: due to the pandemic, the business processes and the industry in general have undergone major changes due to the rapid digital shift. Many companies have had to quickly update and expand their technologies to keep up with the situation. As a result, some business trips have been replaced by online meetings and this is one of the reasons why the restart is proceeding slowly.
  • Operating environment: now more than ever, there is a need to be categorical about rules and policies, for both business and leisure travellers. 

Currently there are many small and medium-sized businesses facing closure or that may need long-term support. We therefore start from the most practical and concrete reasons, which are linked both to the spread of variants and to the rates of vaccinations and changes in the containment policies of the various countries.

The management of the pandemic in the resumption of business travel

Four main points influence the restart of international business travel:

  1. Vaccination rates varying from country to country and vaccinations are elements that should probably be taken into consideration when setting travel policies in the future. 
  2. A common recognition: the certificate of vaccination and the result of the swab that will determine which travellers will have easier access to certain destinations.
  3. Prevalence of variants and hospitalisation rate: Although each country adopts its own containment measures based on the circulation of variants, business travel will adapt to avoid high-risk areas.
  4. Tests Accessibility: The availability and cost of testing will play an important role in budgets and employee safety management.

The main point by the way is the administration of vaccines, not yet consistent in many countries but which will have a major impact on the way of travelling. Currently the vaccination rates (two doses or Janssen mono dose) administered in various countries are:

  • Europe 68.7%
  • USA 61.2%
  • India 41.4%
  • United Arab Emirates 90.7%
  • Argentina 70.5%
  • Brazil 66.7%
  • Africa 8.57%

The higher the number of vaccinated people, the easier will be for the various countries to open their borders and allow travelling without quarantine obligation.

The concern is though, that with the outbreak of new variants, new restrictions might be imposed yet again. Hence the importance of being able to assess the overall risk within a region: for example, Japanese travellers have a strong aversion to risk and, consequently, their restart will be slower due to stricter travel policies. Unfortunately, the path to recovery is still long and it is uncertain when we will be free from COVID-19. According to the experts and the WHO it is possible that the pandemic will never completely disappear and that the virus will still be present -albeit with far less power over time– and therefore turn endemic. This may result in ups and downs of the disease that could lead to alternating restrictions and freedoms in time.

Digitisation process

The digitisation of the process was already underway but the pandemic and consequent lockdown speeded it up significantly.

The pandemic forced everyone to adapt, very often accelerating the evolutionary process of the business models, expanding the service technologies to manage the communications with clients or simplifying some internal operations. This also favoured the exponential growth of BizAway reality as a natural consequence.

Digitisation has also taken important steps in changing the concept of work, thanks to the introduction of remote working and the consequent the adoption of technological tools. All this also helps the environmental sustainability thanks to digital archiving tools that can help reduce printed paper.

On the other hand, being forced to adapt and substitute presential meetings with online ones reduced the need for business travel and companies realised that now presential meetings are not always necessary.

During GBTA Conference in 2021, the Amadeus sales manager corporations Marco Franzese and the AirPlus International Italia country manager Daniele Aulari spoke about the importance of digitisation, and specifically of how it will lead to a new travel model thanks to the spreading of digital payments.

BizAway and the upswing

Although the average loss recorded by travel agencies in Europe – roughly 80% – BizAway succeeded in maintaining a stable grow in terms of clients acquisition and triplicating its client portfolio.

Despite the tough times, BizAway recorded an upswing on bookings yet since June 2020 thanks to the reopening of the boarders (20% bookings increase compared to the previous month). A decline was then felt again from November 2020 onwards with the introduction of new restrictions; however, generally the year had ended positively by recording these percentages in the different verticals compared to 2020: 

  • +2% cars
  • +27% flights
  • +56% hotel
  • +15% trains

Despite the uncertainty given by the continuous closures and re-openings occurred from January 2021 onwards, BizAway experienced an average monthly growth in volume of more than 35% in the last 12 months (2021), with a peak in August 2021, with a fivefold increase in bookings compared to the same month of the previous year (2020). 

Mass vaccination and the arrival of the green pass – which in many countries eliminated the demand for PCR or antigenic molecular swabs – certainly helped this push, but also the need to start organising the most important business meetings live again.

“The pandemic has severely affected the travel sector, initially we were taken by surprise but instead of waiting for the situation to unblock, we adapted and took the opportunity to implement our platform” says Luca Carlucci, CEO and co-founder, ” Thanks to this possibility we are able to offer an increasingly smart and agile service to our current clients and to all those who will come”.

Among our constant implementations and improvements to the platform – in order to guarantee greater control and safety in carrying out business travel – and the evolution in the field of business travel, we look to 2022 with the hope of a further push in overcoming the crisis dictated by the pandemic.