The TMC Model Is There A Smarter Way? CBTG Boston – August 4, 2011

Objective & Process Today Antitrust Ground Rules Relevant Background Value Proposition Exercise Good Morning

Traveler tracking Full content Global relationships Timely, accurate reporting Good self-booking tool Mobility platform Proficient agents Single source customer service Analysis & savings ideas Travel Manager & TMC Feedback What are the must-have deliverables today to corporate travel programs from TMCs? Traveler tracking Full content Global capabilities Accurate reporting Multiple GDS capability Consulting services Personalized service After hours reservations center Ticket tracking (unused, non-refundables) TRAVEL MANAGER TMC EXECUTIVE

GDS Customer service Booking tool Social networking tools Industry knowledge Central data repository Travel policy administration Travel Manager & TMC Feedback What are the key benefits of the current TMC model for your organization? What’s really working well; worth preserving? GDS incentives working well Professional counselors Vendor liaison Client advocate Crisis management services TRAVEL MANAGER TMC EXECUTIVE

Supporting policy compliance Locating travelers in time of crisis Supplier negotiations* Data management & reporting Transparency in spend Superior customer service One-stop shopping Ally with suppliers Travel Manager & TMC Feedback Where does the TMC add the greatest value today? Policy control Risk management Negotiated savings Capturing data centrally Efficient travel operations Cost savings ideas Experienced people Technology TRAVEL MANAGER TMC EXECUTIVE

Offerings however the traveler wants them Better global support Better data Better customer relationships More consultant than agent Travel Manager & TMC Feedback Where could a TMC add greater or totally new value? Mobile systems Better global reporting Better support of online booking systems Address existing flawed pricing model Ability to book all products through the GDS TRAVEL MANAGER TMC EXECUTIVE

Financial transparency Traveler access to expertise Too GDS dependent Travel Manager & TMC Feedback What are the key deficiencies of the current TMC model for your organization? What’s really broken, in your view? Securing real-time global data Pricing model Constant unbundling TRAVEL MANAGER TMC EXECUTIVE

Monthly management fee a better model Yes, easy to allocate costs Annual management fee would be better Travel Manager & TMC Feedback Does the TMC transaction fee, as a central component of the current model, remain useful? Is there a smarter approach to TMC compensation? Transaction fee works if there is transparency in costs to provide services Cost plus model better Transaction fee does not capture efforts where no transaction takes place TRAVEL MANAGER TMC EXECUTIVE

Consult on mobile Consolidate traveler servicing to one expert group Figure out how to collect a higher percentage of hotel commissions More consultative assistance with supplier contracting Help with meetings management Travel Manager & TMC Feedback Are there TMC revenue opportunities worth exploring that could help sustain the model and benefit both TMCs and corporate clients? Diversify portfolio to include peripheral solutions to include solutions for global traveler Manage more information and products Sell airline ancillary services Lower transaction fees and unbundle work products TRAVEL MANAGER TMC EXECUTIVE

Secure all content Work as data management company rather than as a travel fulfillment vehicle Reduce GDS dependence Travel Manager & TMC Feedback What overall changes would you recommend to the current TMC model, if any at all? Focus on mobile Expand services Greater TMC / client collaboration Vis harmful supplier policies Work toward multi-sourcing systems TRAVEL MANAGER TMC EXECUTIVE

Would reconsider old fashioned rent-a- plate or CTD Direct connections with vendors Travel Manager & TMC Feedback Are there whole new models worth exploring that you have considered? Multi-sourcing environment Yes, but the marketplace is not ready for them TRAVEL MANAGER TMC EXECUTIVE

Greater flexibility and speed to make program changes Clients need to help TMCs develop new products and services Travel Manager & TMC Feedback Are there other thoughts and ideas that you would like to add? Corporate procurement has caused a shift in focus to the 2% transaction cost away from the 98% total cost TRAVEL MANAGER TMC EXECUTIVE

What Could A New Model Look Like? The TMC Model

Full content Traveler tracking Booking tool Data & reporting Analysis & cost-savings ideas Mobile platform Global capabilities Must Deliver

Travel / procurement manager performance measurement Cost allocation to business units Compelling business case ✴ control of program ✴ cost savings ✴ new value ✴ quantifying program success ✴ risk mitigation Barriers To Change

Status quo transaction fee model; improve value proposition communications Financial Options Benefits Drawbacks Variations

Status quo transaction fee model; improve value proposition communications Cost plus Financial Options Benefits Drawbacks Variations

Status quo transaction fee model; improve value proposition communications Cost plus Management fee Financial Options Benefits Drawbacks Variations

Status quo transaction fee model; improve value proposition communications Cost plus Management fee Lower transaction fee; unbundle services Financial Options Benefits Drawbacks Variations

Status quo transaction fee model; improve value proposition communications Cost plus Management fee Lower transaction fee; unbundle services Zero transaction fee for online Financial Options Benefits Drawbacks Variations

Status quo transaction fee model; improve value proposition communications Cost plus Management fee Lower transaction fee; unbundle services Zero transaction fee for online Other? Financial Options Benefits Drawbacks Variations

Status quo transaction fee model; improve value proposition communications Cost plus Management fee Lower transaction fee; unbundle services Zero transaction fee for online Other? Financial Options Benefits Drawbacks Variations

Flesh out models BTC analysis to the industry Broad travel manager survey Regroup with you Expand BTC Kitchen Cabinet Immediate Next Steps

Thank You!