Low-Cost Airlines Build Portals For Business

Low-fare airlines are building better online-information tools to grab more share of the business-travel market. Taking cues from the success of Southwest Airlines' swabiz.com online corporate-booking tool, America West Airlines late last month launched its version, and JetBlue Airways said last week it plans to have a site up within two months.

Meanwhile, Southwest said that it has formed a sales and management team dedicated to directing business customers to the portal, which saw enrollments rise 80% year over year during January and February.

Online corporate-booking systems let low-fare carriers give travel managers more reporting data and purchasing control. One way that low-fare airlines keep costs down is by not paying fees to participate in all of the distribution systems--such as Sabre Travel Network, Galileo International, and Worldspan--used by company travel departments and travel agencies to book airline travel and collect data. But airlines that don't participate can lose business bookings by not making fares and travel data--such as employee whereabouts, spending summaries, or top routes--available to company travel departments.

Health-maintenance organization Kaiser Permanente, which spends $15 million a year on airfares, was among the early users of the portal when it launched four years ago. Margy Skinner, director of national contracting, travel services, and meetings, says the company spends $6 million with Southwest alone and that it has realized significant savings by using the online tool rather than using its in-house travel agency to book Southwest tickets. Before swabiz .com, employees would book tickets on Southwest's consumer Web site, which meant Skinner couldn't access data related to that travel and risked not qualifying for major quarterly rebates based on volume.

The problem with in-house sites: Travel managers will tolerate them only for the airlines they use the most. Health-care provider Sierra Health Services Inc. uses the portal because Southwest is its choice for more than 50% of its air travel. America West and JetBlue might not justify the effort. "My head would explode," says corporate travel manager Marianne Millsaps. "They're offering me more tools than I need."