State of the Industry: A Few Words About Airfare
August 21, 2017
by Joseph Lipman, President
It's no secret that the recent volatility in oil prices has created chaos in the airline industry. Domestic and international carriers have been struggling to operate their businesses under impossible conditions, and it appears likely that changes in the coming months will make booking air travel even more challenging.
When inviting guests to Investigator Meetings, we at Summit believe that physician guests should receive the highest possible level of VIP service with respect to booking their air travel – a level of service most corporate travel departments are not always adept at providing. At the same time, keeping an eye on the bottom line is something our staff is trained to do for each client’s meeting – and we dedicate a team of specialists to each meeting so that when your attendees book their travel, we know exactly when they need to travel.
We believe our clients’ interests are best served by reasonably accurate guidelines for average airfare estimates. For budgeting purposes, these estimates are more valuable than “wishful thinking” targets, which can not realistically be attained. This is not to say that careful fare management is not needed; it is simply a statement that physician demands often require deviations from ideal booking policies.
Summit Management’s air booking team has more than twenty year’s experience booking reservations for physician/investigator meeting conferences. We pioneered the use of zone fares, and have actively pursued aggressive fare reduction policies, based on directions received by our clients. However, we believe it is important to be realistic about the demands of physician attendees.
Time constraints, airline service levels and personal idiosyncrasies often preclude the use of the most economical airfares. Above all, it is the agent’s responsibility to get the physician to the meeting in a manner which optimizes courteous service, respect for the attendee’s time, and value of the sponsor’s travel dollar.
Our airfare estimates factor in a multitude of variables that only an agent with years of experience can provide. Our starting point is the best available zone airfare covering the subject destination. Depending upon meeting size, we sometimes offer two carriers. The lowest zone fare is not always the most favorable, because attendees must be willing to fly the zone carrier from their home cities.
We typically have incomplete information regarding the actual mix of travelers, even if originating points are known. The timeliness of physician responses is a crucial factor, as is final selection of the meeting location in enough time to obtain the best airfares.
Delays in the selection process can often increase average airfares, because discount seat availability decreases substantially less than thirty days prior to a meeting. Availability of airline seat inventory fluctuates minute by minute, and there are literally millions of system fare changes every day.
On any given meeting, we typically encounter a number of participants who refuse to fly on any carrier other than their “preferred” frequent flier carrier, regardless of price. We always treat such requests discreetly, but in most cases, the program host agrees to do what that guest requests. And, of course, the zone contract carrier will not cover all originating cities, so additional expenses will be incurred whenever discounted fares can not be obtained.
Consider also the inevitable misplaced tickets, last minute responses, attendee substitutions, and the general last minute changes, and we think it is clear any estimate based on more simple criteria is not likely to be attained. The situation is so unpredictable that even when meetings are held repeatedly at the same destination, fares can not be forecast because of variations in demand and special “sales” which can pop up or disappear without notice.
The bottom line, then, is that any specific program’s total airfare can not be accurately projected. Relying on general experience levels of your agent, you can obtain ballpark estimates. But you must understand that market conditions and attendee demands are the real determinants of final cost. Under these circumstances, your trust and confidence in the air-travel booking agent is the single most important factor in controlling airfares.
We have absolutely no incentive to do anything other than to get your customers to and from your meetings as conveniently and inexpensively as follows. In fact, larger agencies that still benefit from override commissions may have a greater incentive to divert business to their preferred carriers.