2017 Survey report on

Business Travel in China

Executive Summary
Despite a slowdown in its economic growth, China is already the biggest
business travel market in the world with total spend expected to reach
USD350 billion in 2017.

However, as China’s economy transitions to the new normal of single digit

growth, the attitudes and priorities of key stakeholders in China’s travel
ecosystem continue to evolve and adapt.

A survey of travel managers in China by CWT Solutions Group - the consulting

arm of global travel management company Carlson Wagonlit Travel (CWT) -
and TTG Events finds that while managing costs and driving savings still
remain key priorities for travel managers in China, more attention is now
also being paid to duty of care and the traveler experience.

At the same time, travel managers in China continue to keep a close eye
on economic and geopolitical developments globally, as they see these
trends having the greatest impact on their corporate travel programs.

Read the full report to find out more.

Preface
Today, China is one of the focal points of global business travel. Despite
a slowdown in China's economic growth, as well as global economic
and geopolitical uncertainty, China’s business travel spend is expected
to grow 9.8% year-on-year in 2017 to reach a staggering USD350 billion.
China is already the biggest business travel market in the world in terms
of spend, having overtaken the United States in 2015.

As China’s economy transitions to this new normal of single digit growth,

the attitudes and priorities of key stakeholders in China’s travel ecosystem
continue to evolve and adapt. Corporate travel managers are at the
forefront of change in this dynamic environment, and have a significant
influence over the direction in which the business travel industry advances.

To better understand the trends shaping business travel in China and

the priorities of travel managers in the market, since 2015 CWT Solutions
Group and TTG Events have conducted an annual survey of travel and
procurement managers as part of the Corporate Travel World (CTW)
China conference. This report outlines the findings from the 2017 survey.

Overview of the 2017 Business Travel Survey

Conducted in February this year, the survey captures the opinions of over 100 respondents in corporate travel-related
roles in China, such as purchasing & procurement, administration, business travel management, meetings & conventions,
general management and human resources & training. The respondents were from a diverse set of industries including life
sciences & healthcare, technology, IT & software services, engineering & manufacturing, energy, mining, chemicals & utilities,
professional services, automotive, transport and logistics.

Respondents were asked about their priorities, concerns, budgets and service expectations from travel management
companies. In addition, they were asked to evaluate the importance of nine market trends that would impact their
companies’ managed travel programs in 2017. This year, the survey also explored the trend of “bleisure” travel – trips that
include both business travel and leisure time.
Travel managers’ priorities

To understand the travel managers’ priorities for 2017, the respondents were
presented with the following list of key travel program initiatives and asked
to mark the ones they would be focusing on over the next 12 months.

Ranking Priorities Respondents

1 Deploy fare tracking and rebooking solutions 52%

2 Manage hidden costs of travel-related stress 50%
3 Streamline expense management processes 49%
4 Consider dynamic pricing opportunities for hotel sourcing 49%
5 Leverage travel data to build predictive and benchmarking analyses 48%
6 Implement door-to-door online booking tool 46%
7 Corporate credit card solutions 46%
8 Leverage big data to adapt travel policy 45%
Further promote travel policy through social media
9 (reviews, enterprise social networks, etc.) 45%
10 Provide recommendations to improve well-being while traveling 45%

Travel managers’ priorities: Travel managers in China were presented with this list of 10 key travel
program initiatives and asked to mark the ones they would be focusing on over the next 12 months.

Overall, the survey results highlight that while managing costs and driving savings still remain key priorities for travel
managers in China, more attention is now being paid to duty of care and the traveler experience.

More 52% of the travel managers surveyed identified the need to deploy fare tracking and rebooking solutions as an area
of focus for their travel programs. Significant fluctuations in airfares are making it extremely challenging to manage travel
costs and budgets. Travel managers are increasingly interested in fare tracking solutions that enable them to re-book
flights and hotels at lower rates if prices drop after the initial booking has been made.

At the same time, travel managers in China are also looking at ways to improve the traveler experience, with 50% of the
survey respondents identifying the need to better manage travel-related stress and improve traveller well-being as a key priority.

The third-most common priortity is to streamline expense management processes, with 49% of survey respondents saying
they would be looking for ways to achieve this over the next year. As travel spend increases in China and transactions get
more frequent and complex, companies in the market will need to adopt new tools and processes such as travel and expense
consolidators, and follow a strategic sourcing approach to manage expenses efficiently for air, hotel and ground travel.
Travel trends

The travel managers in the survey were also presented with a list of nine factors impacting business travel, and asked to
mark all the trends that they expect will have a significant impact on their corporate travel programs over the next year.
These nine trends can be broadly grouped into three categories:

Economic and Political trends (comprising “Global economy”, “Corporate social responsibility” and “Political context”)
Technology trends (comprising “Data security”, “Big Data” and “Mobile technology”)
Social trends (comprising “Millennials’ travel behaviour”, “The Sharing economy” and “Social media”)

Ranking Priorities Respondents

1 Global economic trends and developments 55%

2 Social media 54%
3 Political developments 51%
4 Big Data 49%
5 Millennials’ travel behavior 49%
6 Data security 46%
7 Corporate social responsibility 43%
8 Sharing economy 40%
9 Mobile technology 38%

Travel trends: Travel managers in China were presented with this list of nine important factors impacting business travel, and asked to mark all the trends that
they expect will have a significant impact on their corporate travel programs over the next 12 months.
With lingering concerns and uncertainty over
the health of the global economy, it is of little
surprise that 55% of the respondents said they
expect this will have a considerable impact on
their travel programs in the coming months.
At the time of this survey, many travel managers
expressed concerns of freezes and budget cuts
being imposed on corporate travel. The weak
global economy also may result in stiffer supplier
management, cost controls and savings goals.

Interestingly, social media is also seen as major

area of change in business travel in China, with 54%
of travel managers in the survey listing this as a key
trend. Social media channels like WeChat are today
used widely for both personal and work reasons.
Business travelers can use social media platforms
for gathering information like weather forecasts
for their destination, reading hotel reviews and
even booking transport and accommodation. This
makes it extremely important for travel managers
to understand how their travelers are using these
tools to ensure they can still keeping bookings
in-channel and in line with the company’s travel
policy.
 More than half the travel managers in the survey
(51%) also said that political developments will
continue to impact their travel programs, keeping
in view the increasing regulations and control on
travel to the US, as well as China’s own diplomatic
relations with its key economic partners in the region
and in the world, and how this might influence
issues such as visa application, air travel and freedom
of movement.

Big data and millennial travelers were the other two

trends making the top five, with 49% of respondents
marking each of these trends as important.

Although the concept of managed travel is relatively new in China, travel managers in this market are reaching levels of
sophistication and maturity rivalling their counterparts in Europe and North America. The use of data, and big data in
particular, is a clear sign of this rapid evolution of the skill sets of travel managers in China.

While travel managers are generally in agreement on the usefulness and importance of big data, some challenges still remain.
Travel managers are still trying to figure out how to incorporate big data tools into their travel programs in a way that allows
them to derive tangible value. A key challenge for travel managers is justifying the investment in this technology to their internal
stakeholders, and being able to measure the return on investment (ROI). More and more, travel managers are looking towards
their TMC partners to help them harness the full potential of big data and measure the ROI on their business travel.

Travel managers in China are also becoming increasingly aware of the impact of millennial travel behavior, as more of
these younger employees begin traveling for work. Having grown up in the age of the internet, with ready access to
platforms such as WeChat and Baidu, millennials have markedly different attitudes and behaviors towards business travel
than previous generations of travelers.

For example, they are more likely to use sharing economy services for transportation (e.g. Didi) and accommodation (e.g.
Airbnb, Tujia) during business travel. This poses a challenge to travel managers who must figure out how to incorporate
these new services into their travel programs. While the discussion on the merits and disadvantages of sharing economy
continues, it’s clear that these players are here to stay and will remain part of the travel landscape.

Whether or not the sharing economy is a good fit for a company’s travel program will depend on their company culture,
their appetite for something new, and their risk management policies, among other things.
BLEISURE: Combining Business & Leisure

Smart phones, cloud computing and VPNs have changed the way people work. Mobile and internet devices allow
uninterrupted work connection, in (almost) every part of the world, blurring the line between work and leisure.

Bleisure has been widely discussed in the corporate travel landscape in recent times. While this trend is more commonplace
in Western countries, the trend is much less visible in Asia, especially in markets such as China where traveling for work
is perceived as a privilege extended by employers, and not to be ‘taken advantage’ of by employees. To get further insights
into bow bleisure travel is managed in China, we surveyed travel managers on this topic.

A key finding in our survey came as a surprise – more than half of the respondents (57%) said their companies allowed for,
and in some cases even supported or encouraged, bleisure.

If you allow Bleisure how do you manage it to If you do not support your employee to have
minimize the impact on your travel program ? Bleisure trip, please select the reason.

21.62% 17.86%
Rules on how travellers can No clear corporate guidelines on
book their leisure travel how to manage this

10.81% Restriction on number of leisure

days that can be included 10.71% Increased administrative work (To manage
leave, travel expenses allocations etc.)

Clear demarcation on how the costs Difficult to maintain clarity/transparency

40.54% will be split when employee's family
or partner joins them on
21.43% on expenses that could be claimed/
cannot be claimed

27.03% All of the above 7.14% Additional cost

As indicated by the diagram left, of those travel 42.86% All the above

managers that accepted bleisure as part of their

corporate travel programs, two in five indicated
that expense clarity and accountability for the
employee and his or her travel companions was
important. One in five advocated for regulations
on how the leisure part of the trip is booked.
Of the respondents that did not support bleisure in
their travel programs, nearly half of them cited a
combination of costs and cost control difficulty, as
well as lack of corporate guidelines and increased
administrative work as the main reasons. One if five
travel managers said it is difficult to demarcate expenses
that are not claimable when employees are on bleisure.