30 Minute Interview

‘Airline commissions still muddying Indian business travel’

Berthold Trenkel COO, Carlson Wagonlit

The COO looks after an incredible portfolio of 25 countries. Yet India is on top of his mind, finds Bhisham Mansukhani.

How critical is the Indian market to CWT?

Our market share here is 10 per cent and that puts us at the top; Jet Airways has recognised us as the single largest agency. Before I joined the company, there was no one in the top management dedicated to Asia. I am now looking at this market closely as part of the 25-country portfolio. This market is getting sophisticated and the scope for growth continues to surprise us. It is one of the four key Asian markets for CWT - the other three being Japan, China and Australia.

How is a typical Indian business travel market?

Service levels in India, even specialised services, are almost as affordable as the tools used in the US to transact travel without using actual human services. Therefore, human contact in conducting business in India is still relatively high. Indians insist on high touch over high tech. We have more than 180 implants for our existing client base here while in Australia we only have four, and five in Hong Kong. Globally, the trend is towards a Business Travel Centre (BTC), like a call centre but run by an integrated group of professionals who can multitask and provide a consistent level of service.

Are airline commissions still relevant to this market?

Airline commissions are still muddying Indian business travel. We work on a commission basis with some Indian clients wherein we pass on a part of the commission to them, which makes things rather confusing. While in other markets like Singapore, we pass it on to the client directly. It makes accounting a lot less complicated. We are seeing this happen gradually in India.

Have you been able to rope all the Indian subsidiaries of your international clientele into your network?

We have, to a large extent. There is always room for more since some of these companies are still dealing with local, single location players. But as soon as they see the benefits of dealing with a company such as ours and enjoy both volume leverage and better costs management, they do come onboard.

What does a business travel company offer a client, besides airline tickets?

The ticket is a mere commodity; transactions have gotten a lot more complex. It is about access to real time and best options and making lean transactions with a specialised approach to airline seats, hotels, car rentals and a host of other ancillaries. We offer options to the traveller who then has to get it approved by the employer who has access to the same information. On an average, we have been able to save our clients at least 15 per cent of their costs before they became our clients.

How relevant are low-cost carriers to this market?

Low-cost carriers are themselves realising the importance of the business travel market and are positioning themselves for this segment by opting for GDS distribution and even frequent flyer programmes. Virgin Blue has done that in Australia and therefore we work with them. In Europe, we created a tool called Webscrapers, which could search websites of carriers which may not be available on GDS.