Marketers know the Four P’s of Marketing: Product, Placement, Promotion and Price. And the most recent edition of The Wire…from AirPlus shows that buyers in this hotel RFP season are focused on just one: Price. However, I think there is one missing from this list…and it’s Partnership.

In the current economic climate, it’s far too easy to run to a supplier that offers a lower price to alleviate the short-term pain. It seems this simplistic attraction is even stronger when the sourcing is lead by the procurement department. In the last nine months, I’ve had companies tell us that while they recognize we have a better product, offer better service and have a greater potential for long-term cost savings, that the other guy has a better price (or rebate, in our payment solution world).

In addition, we’ve seen an increase in the use of a reverse pricing auction as a tool for selection of a card provider – a process that puts all of the focus on the rebate. This approach to payment sourcing is disappointing when we see someone make the switch from a product and process that works, to something they admit does not measure up, but offers a better price. This action highlights one of the worst impacts of the recession on the travel industry. Where is the value of partnership in the equation? When did it become a better decision to buy cheap and ignore the long-term value?

More than a year ago, I began speaking of the evolution of travel management from transaction management to demand management and ultimately to value management. The premise behind my prediction was that as we see the travel management profession grow and mature, we would also see leading companies move beyond managing suppliers and policy to a real management of the value of travel. And, in doing so, they would advance the relationships with their travel partners away from volume pricing and market share deals into strategic relationships that deliver value. When I saw the first steps of our decline into recession, it was my hope that this time it would be different than before. The reality is, it isn’t.

So, can we recover from this slide into the ‘old ways’ of travel management? I encourage travel management professionals to take a breath and consider their options fully. Now is the time to be the leader that drives your travel program to deliver the value your corporation expects. If you have seen these old habits come back to dominate the discussion within your company, it is time to stand up and reinforce the importance of partnership and the long term value it delivers.

	Posted by: RichardCrum Comments: (1) Last Comment: Scott G. More by RichardCrum AirPlus hotel procurement The Wire...from AirPlus