Travel Procurement - February 2016

Hacking Headaches & 2016’s Sourcing Scenario

We’ve turned the corner into 2016. Happy New Year! In terms of travel sourcing for the coming year, there’s good news and bad news. Good news first: Airline sourcing could get interesting as the major U.S. carriers have finalized merger activities and begun competing for corporate accounts on products, services and operations commitments. Transportation editor Michael B. Baker reports on page 22 that airlines will be looking for buyers that can offer solid international volume to shore up weak demand on those routes. As airlines grab for market share, deals will be made.

The skies won’t be so sunny for travel buyers looking to strike deals with hotels. Despite the expectation on Wall Street that the bottom is about to fall out of the hotel market, STR and PKF both project strong occupancy and average daily rate growth through 2017. Associate editor Julie Sickel digs into the disconnect on page 20 and explains why Wall Street’s skepticism won’t boost buyers’ negotiation power this year.

Hotel sourcing may require some extra attention in 2016—and not just because of difficult rate negotiations.

Data hackers have gripped the hotel industry. Toward the end of 2015, Starwood, Hilton and Hyatt all disclosed that they experienced months-long security breaches over the course of the year. Smaller hotel chains like the Trump Hotel Collection and Mandarin Oriental disclosed similar breaches in July and March, respectively.

Travel Procurement’s cover story this month lies at the intersection of hotel liability and payment systems. Lodging editor Julie Sickel and payment editor JoAnn DeLuna help travel buyers understand why and how hackers target hotels with malware and how solid sourcing and contracting can help prevent and mitigate the effects of data breaches, card fraud and identity theft for their companies and travelers. Turn to page 14 to read the story.

Closing our issue this month, Choice Hotels International CEO Stephen Joyce spoke with Travel Procurement about positioning Choice as a technology provider as much as a hotel chain and why that dual role is important for the future.