When worlds collide – The Qantas and AirBnB partnership

Airline Leader

By Kurt Knackstedt

Qantas recently sent the Australian travel industry into media overdrive by announcing a new partnership with sharing economy darling AirBnB. Qantas CEO Alan Joyce in a press release on 4-Oct-2016 explained part of the reason behind why Qantas did the deal with AirBnB: "The way that people around the world plan, book and experience travel is changing rapidly with the digital revolution".

  • Qantas has announced a partnership with AirBnB, signaling a shift in the travel industry due to the digital revolution.
  • The partnership combines traditional corporate travel with the disruptive sharing economy model of AirBnB.
  • Corporate travel managers may face questions from travelers about using AirBnB as a result of this partnership.
  • The partnership highlights the growing influence of business travelers in shaping the suppliers used for corporate travel.
  • The endorsement of AirBnB by a major corporate travel supplier raises questions about the future of corporate accommodation options.
  • The partnership has the potential to be a game changer and disrupt the traditional rules of travel purchasing.

For most of us in the travel industry, the idea of a "digital revolution" (in Mr Joyce's words) is not really so much as happening as already happened. What is remarkable about this announcement is not so much about the technology itself - but rather the changes to long-standing strategies that these new technologies and concepts can and have enabled.

From a business travel perspective, this partnership has its feet planted in two separate yet rapidly converging worlds: one in which traditional suppliers do their best to engender tremendous loyalty amongst their highest spending corporate customers and their travellers so as to secure their lucrative, high yielding revenue. The other world is one in which the traditional rules of travel purchasing - which are primarily based on dealing with specific, vetted and contracted entities - are being trampled upon by travellers who are tired of being told what to do at the expense of their travel experience, productivity and sanity.

Qantas has had a dominant share of the antipodean corporate travel market for years, and that dominance has been built on the back of high volume commitments they require of their corporate customers in exchange for good deals. In essence - work with us and we'll make it worth your while.

Hotel providers have followed a similar route in the corporate space, in negotiating contracted rates with corporations in exchange for commitments in room nights. Although the hotel industry is slightly more complex than airlines in that the brand does not always own the assets directly, nonetheless hotel sales teams the world over still are trying to generate corporate loyalty through relationships and contracts.

What's disruptive about this new partnership is that it is now brought together those two aforementioned worlds - traditional corporate travel with sharing economy disruptor - into one package. Corporate travel managers who work with Qantas have no doubt already fielded questions from their travellers asking "can I use AirBnB now given they're partnered with our preferred corporate airline supplier?" Which also no doubt is not making that company's preferred hotel supplier very happy.

Despite there being about as many opinions on the viability of AirBnB as a corporate accommodation provider as there are AirBnB listings globally these days, this partnership is a coal mine canary of sorts. At the Association of Corporate Travel Executives, we've been highlighting and educating corporate travel managers for several years now about the importance of recognising "traveller centricity" as a key element in helping craft a modern-era travel programme. This Qantas/AirBnB partnership could be considered another example of how much leverage business travellers now have in influencing the suppliers that companies use (or at least consider using) for business travel.

Now that a major supplier to the corporate travel industry has, in essence, endorsed AirBnB as a viable accommodation option, what does this truly mean for corporate travel? Time will tell, and to be clear Qantas has not specifically called out any reference to corporate travellers in their announcement. However, as there are 11.4 million Qantas Frequent Flyers out there, the majority of which are business travellers, the dots are now both very public and very possibly connecting in ways that the corporate travel industry is pretty much compelled to decide quickly how to respond.

And that is the very essence of a disruption: unexpected, potentially game changing, and ever talked about!