The Certify SpendSmart report for the fourth quarter of 2015 showed that the pioneering ride-hailing service eclipsed rental cars as a percentage of total rides nationally. The increase continued the trend of the prior seven quarters and, in 4Q15, Uber accounted for 41 percent of all paid rides. The taxicab category, which includes traditional taxicabs, limousines and shuttles, accounted for 20 percent, a dip from 22 percent in 3Q15.
The Certify SpendSmart report, which is issued quarterly, tracks spending across major categories such as food, airlines, lodging and car rentals and highlights top vendors for business travelers using data from millions of business expense receipts processed using Certify.
Rental cars, the most popular at 44 percent during the third quarter, dropped to 39 percent in 2015’s final quarter. Just less than two years ago, in 1Q14, 55 percent of paid rides were in rental cars. At that time, taxis accounted for 37 percent and ridesharing a mere eight percent, according to data provided to TheTravelPro by Certify.
Lyft, currently the number two ride-hailing service, has seen its popularity skyrocket over the past year, with a whopping 712 percent annual growth from fiscal year 2014 to f/y 2015. However, it still accounts for a much smaller percentage of total ground transportation than Uber, according to Certify.
The report showed the face of business travel is changing in a number of other ways.
In addition to embracing non-traditional methods of ground transportation, business travelers are also increasingly turning to the so-called sharing economy for their lodging needs.
Airbnb’s efforts to attract more business travelers appear to be paying off, with its overall annual portion of business lodging expenses growing 259 percent. Domestic use was up 261 percent while international use grew 249 percent. The most popular U.S. cities for Airbnb were San Francisco, Chicago, Seattle, Oakland and New York. Internationally, the most popular cities were Vancouver, B.C.; London; Toronto; Mexico City and Sydney, Australia.
Business travelers appear to be increasingly cost conscious. Use of the service Hotel Tonight, which offers “Amazing last-minute deals at top-rated hotels,” grew 1,050 percent over the year before. Use of co-working space WeWork grew 900 percent.
Business travelers are also increasingly turning to on-demand food delivery services. Use of Postmates increased 516 percent, Doordash increased 355 percent and organic food delivery service Sprig grew 148 percent.
The report also lists the hotel chains, restaurant chains, car rental companies and airlines that are most frequently expensed, the average amount of those expenses, and the ratings of the service providers.
Hotel chains, which had reflected a similar disconnect in previous reports, showed a closer alignment between preference and actual usage in the 4Q15 report. Marriott Hotels (NASDAQ:MAR) were rated the best with 4.3 of five possible stars and were the most frequently expensed, at 9.39 percent of the time. Although tying Marriot's rating of 4.3 stars, Westin Hotels did not even make the list of most frequently expensed accommodations. Hyatt Hotels, which are users' third preference, is No. 9 on the list of hotels expensed. Other top-rated hotels include Hampton Inns and Courtyard by Marriott, each with 4.1 stars.
Westin is a Starwood property (NYSE:HOT).
When it comes to eating while on the road, Starbucks (NASDAQ:SBUX) continues to be the most frequently expensed, followed by McDonald’s (NYSE:MCD), Panera Bread (NASDAQ:PNRA), Subway and Dunkin’ Donuts (NASDAQ:DNKN).
Interestingly, the restaurants patronized most often do not strictly align with those travelers rated highest. While the most frequently expensed, Starbucks tied for third in the category of top-rated restaurants. Chick-Fil-A was rated best at 4.5 out of a possible 5 stars by travelers but retained its ranking as the seventh most expensed restaurant chain. Despite its recent troubles, Chipotle (NYSE:CMG) retained the No. 2 most-favored position at 4.3. Starbucks and Panera Bread tied for third with 4.2 stars with Jimmy Johns sandwich shops rounding out the top five, at 4.1 stars.
Starbucks is the restaurant most frequently expensed for breakfast and has 15.76 percent of expense entries for the morning meal while McDonald’s is, for the second consecutive quarter, the most expensed for lunch at 3.46 percent. McDonald’s was also most expensed for dinner at 1.78 percent. In all, the percentages for the top 15 most frequently visited restaurants total 21 percent, possibly indicating that a significant majority of business travelers eat at restaurants that are either stand-alone operations or part of very small or local chains.
Buffalo Wild Wings (NASDAQ:BWLD), which was the No. 15 most frequently expensed restaurant, returned the highest average cost, at $43.10. Jimmy John's had the second highest expense level at $39.18, followed by Panera Bread ($37.79), Applebee's ($36.48) and Chili's ($33.30). Applebee's is owned by DineEquity Inc. (NYSE:DIN), while Chili's is owned by Brinker International (NASDAQ:EAT).
When it comes to renting a car, the “most expensed” and “top rated” lists are in closer sync. In the fourth quarter, National Car Rental was the most expensed and the travelers’ second favorite while favorite Enterprise was the second most frequently expensed. Avis and Hertz (NYSE:HTZ) were the third and fourth favorite, respectively, and the fourth and third most frequently expensed. Budget was both fifth favorite and fifth most expensed. All of the rental car companies except Hertz are operated by Enterprise Holdings, which is privately held.
Company comptrollers should find one aspect of the most recent report particularly pleasing: The average cost per expense category was down $13.55 since 201, according to Certify’s data. Certify analyzed nine million receipts/expenses in 4Q15 alone, and more than 30 million for all of 2015.
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