Companies fight for bigger share of air travel market

Business travel

December 02, 1991|By Tom Belden | Tom Belden,Knight-Ridder

The corporate charge- and credit-card arena has become a battleground, with MasterCard and Visa, two traditionally consumer-oriented card programs, more aggressively seeking business from companies with lots of traveling employees.

Air travel makes up the biggest part of the charge- and credit-card market. American Express Co. has been the biggest in the business for years, with about 47 percent of all tickets put on American Express Cards in 1990.

Visa is in second place, with about a 19 percent share of airline tickets; followed by MasterCard, with 12 percent, and the Air Travel Card and Diners Club Card, with about 10 percent each. All of the figures are from the 1991 Nilson Report, a credit-card trade publication.

The most recent sales blitz for new business follows the linkup of MasterCard's BusinessCard and the Air Travel Card, which is a charge-card system owned and managed by the airline industry.

The Air Travel Card is used by about 100,000 corporations worldwide and has been popular because it has no credit limit, provides users a clean and simple look at just their air-travel bills every month and includes automatic travel insurance each time it is used.

But Air Travel Card also has seen its market share dwindle in recent years because of competition from other cards and the flexibility of bill-paying systems offered by Visa and MasterCard. The Air Travel Card is a charge card, with the balance due at the end of a set billing period.

Under the new scheme, each of the seven U.S. and 21 foreign airlines that issue Air Travel Cards can affiliate with any of the thousands of banks that issue MasterCards. The two will then issue customers just one type of card, good for all types of transactions and giving travelers access to cash from a worldwide network of automated teller machines.

The result will be a more flexible payment system for the companies, since the holder of a MasterCard BusinessCard can choose to pay off a bill monthly or stretch out the payments, just as an individual does with a credit card.

The linkup gives companies that have been using only the Air Travel Card the choice of using bank ATMs affiliated with MasterCard as a way to issue cash advances to travelers, marketers for the program added.

That, of course, is an advantage to Visa, which also is hooked into bank ATM networks worldwide, and for American Express, which has its own network of cash machines. All of the card programs also promise to provide customers' companies a large amount of management information about their travel costs.

Visa has been very active in recent months in trying to increase its market share among business travelers, and has signed up some of the largest travel agencies in the country as marketing and promotional partners.

Among the partners are five of the eight largest agencies, including Rosenbluth Travel, of Philadelphia; Carlson Travel Network, of Minneapolis; IVI Travel Inc., of Northbrook, Ill.; LifeCo Travel Services, of Houston, and Maritz Travel Co., of St. Louis.

In addition to those five, "more than half of the top 20 agencies are also marketing Visa Business Cards, and we anticipate more will join ... soon," said Anne Kortlander, vice president of card-product management for Visa U.S.A.

*

With the holiday season coming, Homewood Suites Inc., a national chain of extended-stay hotels, has some tips for business travelers for saving time in and around crowded airports:

* If you have lot of heavy and bulky papers or other files to carry on a business trip, ship them ahead using a package-delivery service so you don't have to check any luggage. Time-saving: 40 minutes.

* Always get tickets and boarding passes from a travel agent, airline ticket office or through the mail before you reach the airport.

* If you're parking at an airport, know how to get to a parking garage or lot or to an off-airport privately operated parking facility before you arrive.

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