By Bev Fearis, published 15/05/20
The co-founder of corporate travel management platform TripActions insisted his company will emerge from the pandemic in a ‘very strong position’ but suggested other TMCs might not.
Speaking at ITM’s virtual conference this week, co-founder and CEO Ariel Cohen said the traditional TMC business model is being challenged in the current crisis.
Referencing the company’s five-year anniversary this week, he said: “We’ve been saying for the last five years the business model of the TMC has to change.”
He told ITM delegates that customers want transparency on fees, touting his company’s one-time booking fee instead of complex TMC fee structures, and said clients also want transparency on service levels, which Cohen claims TripActions provides.
He said while TripActions has grown organically, rival TMCs have grown through mergers and acquisitions, which requires accumulating debt and could pose problems in the current environment.
A few weeks ago, TripActions was alerted to emails being sent to its customers claiming it was ‘unfortunately no longer in business’.
It claimed the emails were being sent by rivals and said, in a statement to its clients: “We’ve also heard that competitors are similarly lying to prospects and investors alike, stating that TripActions has ‘pulled out of Europe’ and ‘left the Asia Pacific market’.
“Rest assured, TripActions will be here long into the future to serve our 4,000-plus customers around the world with a continued local presence, offices and employees in EMEA, APAC and North America,” said the statement.
“This is no doubt a difficult time for every organisation around the world, but especially those whose livelihoods are in travel. It’s difficult times like these that reveal the true character of leaders, organisations and their culture. It’s been especially disappointing to see the lack of integrity across so many of the legacy TMCs.”
Cohen said at the time: “The reality is that these TMCs are making false claims out of fear. Like many of their customers, they’ve realised that their technology is outdated and antiquated. Their tools, built decades ago, have not kept pace with industry innovation or the needs of their customers.”
TripActions laid off around 300 global staff in late March, including 25 who were offered other positions within the company. Cohen said it was particularly difficult to tell staff the bad news over video conferencing.
He told ITM delegates this week that despite the pandemic crisis, TripActions continues to win business in Europe and had recently signed ‘two big enterprises’ in Europe, although he could not disclose names at this time.
“We believe in a year or two years from now we’ll be in a very strong position,” he said.