ANALYSIS: November 19 2009

Like most in the travel industry, Sabre has had a tough year. But it has also been one of opportunity in Europe, Martin Cowley tells ABTN 

"Everyone knows what has happened this year," said Martin Cowley, Sabre Travel Network's senior vp for the EMEA region, said. "Corporates have downsized and we have been impacted by this.

"We saw that October showed signs of getting better but we are not getting too excited. We just see the transactions but we know that yields are substantially down.

"I would say we are bouncing along the bottom but we might be doing a bit better than that."   

The sense that 2009 has been a bad, bad year for business is shared by executives from airlines, hotels and IT companies.

"We are seeing a lot of opportunities to do things in Europe. Corporates are putting their budget together for next year and I would be really surprised if ceos were approving bigger budgets. But there is a lot of optimistic people out there," he said.

But the hope is still tempered by the current reality. If attitudes to travel are starting to relax in the US, over here in Europe travel levels are still very much down, especially trips for internal meetings, he said. Being Sabre, the largest GDS in the world and a major provider of technology for travel, helps open a few doors to demonstrate new products, Mr Cowley said. But it had been challenging in the past year actually getting through that door.    

Unlike some who fear 2010 could be just as deflating, Mr Cowley sees the chance to seize new opportunities. "2009 has been a breakthrough year for us in Germany and next year we will start to see some new business flow," he said, a situation helped no doubt by the continuing spat between Lufthansa and Amadeus over the airline's controversial preferred fares programme.

"We have invested a lot in product awareness in Europe in terms of rail for business travel and for airline leisure travel and in both of these we have done pretty well."

He sees further expansion of business in Europe as likely for 2010, where Spain and Russia are two primary targets. This eye to expansion in Europe is based on a new approach. "One of the things that we have done differently over the past two years is to have created a broader base which addresses needs in several countries.

"Quite often there are quite a lot of synergies. We take the things that we do well in the US and Asia and bring them over here. It is a tough market and people are more change resistant. So we have worked hard on product investment," he said.

Some of this investment has been on rail with first the French national company SNCF and secondly the German equivalent Deutsche Bahn so Sabre-connected agents will have easy access to rail timetables in these two countries. With up to 60% of business travel in Europe now by rail, Mr Cowley believes these are investments that will pay off.

While he admits some of the new products are "catch up" with other companies, there are also  ones dealing with content optimisation and refunds where Sabre has been first to the market. Often these have been launched first in the US before coming over to Europe.

As the market has become tougher, Sabre, like other GDSs, has noticed clients asking for more backing on technology. "Customers want us to support them more broadly with IT. It's not getting any easier to make a dollar out of travel and you have to optimise every opportunity that you can," he said.

If countries are presenting Sabre with new opportunities, Mr Cowley believes travel management is doing the same. This is an areas which has changed, not only through travellers taking shorter trips or downgrading, but also in how the whole business should be managed.

"People have to think about how their model is doing. Whether it is a traditional or online agency,  they are having to think about their model. So if there is anything that we can provide that will help them, we look into it. In that sense our role has also changed a lot in the last year," he said.

 This, he thinks, in part stems from the demands of the corporate which have increased in the last 12 months because of the tougher times. "What was added value, is now core," he remarked.

This spelt an end to the "old dynamic: ‘We know what you want but we can't deliver it'." IT companies can now deliver, even through the demands from the agents and corporates have risen.

It is up to the clients whether they wish to spend to take on the running costs of any new services. And if they did, it created a tougher situation for the IT companies like Sabre. "We have to get it right every time," said Mr Cowley.