British Airways nears launch of B2B portal

LONDON -- British Airways PLC (BA) is weeks away from launching a new business-to-business Internet portal that will give it direct access for the first time to the highly lucrative $5.04 billion small business travel market in the U.K.

In an unusual twist, the $11.52 billion airline also is launching a twin version of its new portal for use by UK travel agencies, which can co-brand the technology to offer their mostly off-line customers Web-based services of their own.

The second version of the portal serves two purposes. First, it should take some of the sting out of the disintermediation effect that direct access to BA by small businesses is bound to have on UK travel agencies. Currently, more than 90% of small-and midsize companies book their travel with BA through these agencies.

Second, it should help travel agencies move their existing customers online more quickly. This would also benefit BA, which will require the agencies to funnel all customer data they receive via the portal back to the airline. Eventually, BA plans to use this highly-coveted data to develop and sell new personalized services such as insurance, automated expense report management and credit cards.

"This lets us access and transact in markets that we've never been in before," said Simon Parks-Smith, head of the company's business-to-business e-commerce unit.

"We'll get information about the kinds of travel small companies buy, their travel habits, and how much their business is worth to BA," Parks-Smith said. "The intent is to personalize and do one-to-one B2B marketing."

For their part, U.K. travel agencies that collect and forward the data "get a Web presence they couldn't before afford," Parks-Smith said. They also will pay a transaction fee of less than $4.32 per booking of flights and other services on the portal, he said.

Going forward, Parks-Smith said the plan is to expand the portal globally, starting with other English-speaking markets, including South Africa, Australia, Hong Kong and Singapore.

In the U.S., small and medium-size companies already have direct access to British Airways via a link into its reservation systems, built by San Francisco-based GetThere Inc. Large corporate customers worldwide have direct business-to-business access to the airline via some 170 private extranets, which generate more than 40,000 hits per week, according to the airline.

Parks-Smith said the new portal took seven months and cost less than $1.44 million to develop. The new system incorporates's online flight-booking engine. The remainder of the system was developed at BA's 120-person dedicated e-commerce unit, which was formed in April.

Parks-Smith said BA is also in talks about licensing the portal to several banks and other institutions, which would use it as the travel-booking engine on procurement portals of their own.

Overall, the airline's goal is to have electronic relationships with more than 50,000 small and medium-size companies by March 2002, he said.

This story, "British Airways nears launch of B2B portal" was originally published by Computerworld.

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