Corporate travel managers projected virtual meetings to replace 27 percent on average of 2022 travel volume, according to a new Morgan Stanley survey. On average, travel manager respondents projected 44 percent and 19 percent of their travel volume to shift to virtual meetings in 2021 and 2023, respectively.
Morgan Stanley surveyed 138 corporate travel managers from June 30 to July 12. About 32 percent of respondents said their organization had annual revenue of more than $15 billion, and 29 percent said it had less than $1 billion, with the remaining 39 percent in between. About 67 percent of respondent organizations had an annual travel budget of at least $10 million. About 67 percent are headquartered in the U.S., 19 percent in Europe, and 14 percent in Asia/other.
Most respondents expect virtual meetings to continue to cannibalize a significant portion of their travel volume in 2023. Nearly 63 percent said virtual meetings in 2023 would replace 11 percent to 50 percent of their organization's travel volume, while 27 percent projected they would replace up to 10 percent. Only 7 percent projected virtual meetings wouldn't replace any travel in 2023, while 3 percent indicated more than it would replace more than 50 percent.
When asked why virtual meetings are replacing travel volume, nearly three-quarters of respondents cited that they represent a more efficient use of employees' time, and 72 percent cited the cost reduction virtual offers. About 59 percent noted Covid-19 concerns, while about 50 percent cited environmental concerns and sustainability considerations, and 39 percent noted higher engagement and participation in meetings and conferences.
Respondents' top reasons for replacing travel with virtual meetings varied based on geography. At 25 percent, European companies considered environmental concerns as the most important reason to replace travel, compared with 5 percent of U.S.- based companies.
The Future of Travel Budgets
The projected shift to virtual meetings seems to be reflected in slashed 2022 travel budgets, according to Morgan Stanley. About 52 percent of respondents expect their organization's travel budget to be slashed 11 percent to 50 percent from 2019 levels. Travel managers on average expect their 2022 travel budgets to be down 17.5 percent from 2019.