Travelogix data shows further drop in transaction value

Economic pressures, geopolitical tensions, a stronger focus on sustainability and evolving blended travel trends led to a drop in average transaction value for business trips last year.

This is according to the Global Business Travel Review published today by The Advantage Travel Partnership, in collaboration with travel data and reporting specialists Travelogix.

The review is based on detailed analysis of business travel bookings through 90 travel management companies handling the accounts of more than 2,000 clients, mainly SMEs.

The data showed average transaction value dropped from £429.35 in 2023 to £399.81 in 2024.

The drop follows a reduction in transaction values last year, which was the first time they had fallen since the pandemic.

“This reduction is reflected in the continuing trend of business travellers turning right rather than left as the economy classes take a higher percentage of bookings,” says the report.

Data shows that bookings for Economy Class rose from 78.99% in the first half of 2024 to 79.81% in the second half, while Business Class bookings fell from 15.61% to 14.69% over the same period.

The report says another factor driving the change is shorter trips, as the average trip duration also saw a significant decrease from 6.9 days in 2023 to 4.62 days in 2024, which brings it more in line with pre-pandemic levels.

The average length of a trip was 4.57 days in 2019 and jumped to 6.71 days in 2022, staying high in 2023. Travelogix said the figure was now normalising and is expected to stay below five days in the next 12 months.

Despite the fall in average transaction value, the Global Business Travel Review reports that the total of new transactions for 2024 significantly outperformed 2023 by 15.5%. Every month outpaced 2023, except June, which saw a downturn of 15.48%. This overall increase was on the lower end of the figure forecast by Travelogix.

Looking ahead, the report predicts a pivotal year for the business travel sector as companies face significant economic challenges such as inflation, currency fluctuations, and rising tax (UK) as the National Insurance contributions and National Minimum Wage increase from April.

Despite potential challenges, the outlook for the year ahead remains positive with forecasts predicting year-on-year growth of 8%-11%, indicating market confidence tempered by some caution.

Andrea Caulfield-Smith, Managing Director Global Business Travel at The Advantage Travel Partnership, said: “The key findings from this report emphasise that the number of business travel trips is continuing to increase year-over-year but faced with rising costs, sustainability reporting and geopolitical tensions, travel managers are booking differently with less premium class bookings and shorter trips than before.

“Whilst there may be challenges along the way, we expect this to be a strong year for the industry and are looking forward to another successful year working alongside Advantage members and supplier partners as we continue to build upon our One Stop Business Hub and deliver market-leading capabilities to support our members.”

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