World Tourism Blog

The travel industry is working to redefine itself as a key player in the American economy by showing how it helps companies improve profits, serves as a source of tax revenue and provides jobs.

Geoff Freeman, U.S. Travel Association senior vice president, said factors that include the recession, a spurt of public anger over extravagant business travel and politicians who lashed out at the travel industry resulted in $2 billion worth of events and meetings being canceled when the rancor was at its peak early this year.

If over the years the industry had done a better job of articulating why it is a vital economic force, the damage likely would not have been so great, Freeman said Tuesday at a national marketing forum organized by the association.

“We had left ourselves exposed, terribly exposed. We were the folks that were an easy target,” Freeman said.

Steve Moore, president and CEO of the Greater Phoenix Convention and Visitors Bureau, said hospitality groups focus too much on hotel and meal taxes, when they should tout their economic impact, including sales taxes and property taxes they bring communities.

The convention business can do more to paint a picture of the people who work in the industry and note that travelers don’t drain city services, Moore said.

Citing research by Oxford Economics, a consulting firm that collaborates with Oxford University’s business college, Freeman said that for every dollar companies spend on business travel, they get an average of $12.50 in revenue and $3.80 in profit.

Christine Duffy, president and CEO of Maritz Travel Co., a corporate meeting organizer, said meetings are a tool for keeping “employees engaged and motivated.” Hard money training

A Seattle woman tweets from an airport that JetBlue’s birthday present to her was forgetting to put her wheelchair on her flight. Seven minutes later, an airline official tweets back that the crew will work quickly to make things right.

On a Facebook page used by Delta Air Lines, a traveler suggests Delta wrap its Wi-Fi fee into its ticket price rather than charge separately. The airline doesn’t respond. The page mainly promotes the airline, talks up new services and offers travelers tips on popular things to do in the cities Delta flies to, like Las Vegas.

Discount airlines have traditionally outflanked the big network carriers in customer service and low fares, and it appears they’re extending their advantage to social media. The discounters often respond with quick feedback to travelers’ concerns on social networking sites, while traditional network carriers peddle last-minute fare deals but seem slow to embrace Twitter and Facebook to beef up customer service.

Customers crave good service and reward airlines that provide it.

A survey cited in a July report by Forrester Research showed that 68 percent of U.S. online leisure travelers say they’d be willing to recommend carriers to family and friends if the company made them feel like a valued customer.

That’s a tantalizing incentive for airlines to transform customer service from the dull telephone and e-mail route into the online networking channel — where every customer can speak his mind to the masses — at a time when the weak economy has caused their revenue to plummet.

The Internet has opened the door to millions of people to beam their views across the planet on everything from the quality of airplane food to how long they waited on the tarmac to take off. This presents a conundrum for some airlines.

It takes manpower to troll social networking sites that are updated around the clock. JetBlue has 10 people involved with social networking; Southwest Airlines has seven. But the big carriers, with their higher costs, have faced budget cuts and reductions in management and frontline staff. US Airways, for instance, in July said it would eliminate 340 customer service agent positions around the country. Hard money training

Business travel  often the target for cutbacks by companies seeking to reduce expenses actually boosts profits and could help the U.S. economy come back from the recession, a report found on Tuesday.

Research released by the global research firm Oxford Economics estimated that for every dollar invested in business travel, companies can expect an average $12.50 in increased revenue and $3.80 in new profits.

“Cutting back on business travel can in the short run have some benefits but, even over a 12 month period, (have) significant negative effects on corporate performance,” said Adam Sacks, managing director of Oxford Economics. “As companies perform, so does the U.S. economy.

“When companies reduce their travel budgets there are negative consequences that we can now quantify, in terms of lost revenue and profit growth and in terms of giving competitors a distinct advantage.”

The study was commissioned in part by the U.S. Travel Association, which represents the American travel industry.

Roger Dow, president of the association, said the report quantified how businesses can benefit from travel and from face-to-face meetings.

The analysis said executives and business travelers estimated 28 percent of current business would be lost without in-person meetings. They said about 40 percent of prospective customers are converted to new customers with an in-person meeting compared to 16 percent without one.

“In this economy especially, business travel has come under greater scrutiny than before,” Dow told reporters.

“It’s very important that business travel be seen as a solution. This industry could lead the economy out of the recession if people begin traveling and doing business.”

The industry group said in the first six months of 2009, business travel spending is down 12.5 percent and business travel volume is down more than 6 percent.

Sacks said a 10 percent increase in business travel across the board could potentially boost U.S. gross domestic product between 1.5 percent to 2.8 percent.

The report was based on a combination of two separate surveys of corporate executives and business travelers and an econometric analysis of the effects of business travel on corporate performance. It covered 14 economic sectors over a span of 13 years. Hard money training