10 December 2009 - Expedia's Egencia corporate travel division announced strategic partnerships with eight travel management companies in Europe Middle East Africa, Asia Pacific and Latin America as part of a global expansion strategy developed last year and launched through the Egencia Global Alliance program. Through the partnerships, Egencia said it added service in Argentina, Hong Kong, Hungary, Romania, Russia, Singapore, Taiwan, United Arab Emirates and Uruguay.
The founding partners in the Egencia Global Alliance include Argentina's Action Travel, which also will service Uruguay, Russia's ATH, Romania's Accent Travel, Ibusz in Hungary, Orient Travel in the United Arab Emirates, Global Travel Pte. in Singapore, Lotus Tours in Hong Kong and Lion Travel in Taiwan.
Global growth thus far has been accomplished through owned points of sale in 15 countries with the latest addition of Sweden. Combined with the new partnerships, Egencia has expanded its footprint to 24 points of sale, according to Egencia North America senior vice president Pamela Keenan Fritz. Within the next 18 to 24 months, Fritz expects Egencia to expand to as many as 48 points of sale. Partnerships, acquisitions and organic growth will continue to fuel the growth.
"This is only the start of the journey for us. We're currently in negotiations with excellent travel management companies that really have deep knowledge in additional markets, and we expect to be making further announcements about the expansion of EGA in coming months," Keenan Fritz said.
Speed Global Growth
"We've had a very strong tradition of global expansion in our short history as an organization. We really wanted to continue that tradition, but speed it up," Keenan Fritz said. Studying strategic options last year, Egencia executives decided that a global alliance program would be best both to quickly expand as well as service existing and potential clients who demanded service in certain countries.
Egencia hired directors in each of its primary regions--North America, EMEA, APAC and in a new region of Latin America--and supported those positions with due diligence, negotiations, customer service and technology expertise to identify and contract EGA partners.
The team focused on markets "where our clients wanted us to go most urgently," and where Egencia could identify "excellent travel management companies," said Keenan Fritz.
Egencia expects its new partners to deliver "service and content," said Keenan Fritz. "Primarily what we want to ensure is that every traveler in our EGA markets is served with a comprehensive content offering, which offers every air carrier, every choice in hotel and every choice in ground transport. That really has been our No. 1 focus." Secondly, she added, partners are expected to deliver Egencia's "global service standards" to clients.
"This is something that resonates very strongly with our global clients because they want to be assured that when a traveler phones in Buenos Aires, St. Petersburg, Singapore or Chicago, they are going to get the same service experience and same standards met," Keenan Fritz said.
Part of the selection criteria, she added, "has been to find agencies that could deliver a very high level of service" that adhered to the global standards Egencia developed with corporate clients. Egencia sought out agencies with a "deep focus on corporate travel and strong reputation in the corporate travel space," Keenan Fritz said. It also sought partners that broadly defined corporate travel services to include
meetings and incentives, which have been other areas of growth for Egencia.
Instead of online service, Keenan Fritz acknowledged that "an offline model" will facilitate bookings "in most markets."
Egencia has created data and technology standards to service its clients, which Keenan Fritz said EGA partners are expected to "leverage and use." In addition to standard data elements, Egencia is to collect additional data from partner agencies to "provide deeper insight and cost-control opportunities through a combination of powerful online reporting services and regular business reviews," according to prepared statement.
"This is part of our ongoing value proposition, to provide CFOs, procurement specialists and travel managers with comprehensive business information and data about their programs on a global basis," Keenan Fritz said. "One of the things we've been talking with potential partners about is being able to provide us with very granular, detailed data that we can then feed into our systems to provide global consolidated reports. That is something we've started on the track of doing, have some clients enjoying now and are going to continue to invest in because it's what our clients want" and can "benefit from the economies and efficiencies of their spend.
"If they truly know everything they're spending in North America and Latin America, EMEA and APAC, they get a much broader sense of the negotiated rates and corporate rates, and can identify savings opportunities," she added.
To aggregate data, Egencia has "invested very heavily and will continue to invest in our own technology," Keenan Fritz said. "We don't have to rely on syncing everybody up through the same global distribution system. GDSs and their content range dramatically by geography, so what is the right GDS for one agency in Asia Pac is not the right GDS for one in Latin America. One of the benefits of having our own technology solution is that we can work in a multi-GDS environment."
Through the new partnership strategy, Egencia has taken the "first step" to an expansion to Latin America, "an important market to us," Keenan Fritz said. "There are some very strong markets in Latin America: Mexico, Brazil, Argentina and Chile. Our clients have strong business interests there and would like us to be there serving them. This is the start of a very exciting new geographical expansion for us."
In-country Support
In partner countries, Egencia "has no intention of developing" its own staff. "What we really want to do is leverage our partners. That is why choosing the right partners with a really solid reputation and deep talent set on their side has been so important. We want to learn and leverage as much from our partners as they will be looking to learn and leverage in Egencia's core markets from us," Keenan Fritz said. Partners are expected to provide "full account management and support at every step in the same way they would be serving their clients."
When it makes sense, Egencia will continue to build or buy other agencies to fuel its global expansion, Keenan Fritz said, "but in parallel, we're looking at where are the centers of excellence--the very well-regarded travel management companies--where it makes more sense to partner."
