Reed & Mackay Building North America Business with 'Steady Stream' of Clients (2024)

Reed & Mackay's Keichline discusses:

• Building talent and client growth in NorthAmerica
• Investing in technology for better serviceoutcomes
• Easing AI trepidation

It's been nearly a decade since UK-based corporate travelmanagement company Reed & Mackay began its expansion into North America,and the TMC today still sees the market as a "huge focus" with a"lot of opportunity," Reed & Mackay North America CEO JohnKeichline said. That has included a significant boost in staffing in NorthAmerica last year and its hiring of longtime Ovation Travel Group executiveIsabel Torres asa new operations managing director for the region in recent weeks.Keichline, who has led Reed & Mackay in the region since2018, spoke recently to BTN executive editor Michael B. Baker about growthopportunities in the region, Reed & Mackay's investment focus and changessince its 2021 acquisitionby Navan, the former TripActions. An edited transcript follows.

BTN: How has Reed & Mackay's growth in NorthAmerica been progressing?

John Keichline: The company started in 2015 in NorthAmerica, and at the outset, it was handling UK clients that had U.S. entities.We were picking up all of our business through that. We started to get a lot oftraction from clients here, U.S.-based clients, and then we started to get U.S.-basedglobal clients, so we were repaying our colleagues who had been giving usbusiness for several years. Then Covid hit, and that set everything on a pause.Coming out of that was a challenge that first year. Clients did not realize howquickly business was going to come back. Despite lots of conversations about aslow uptick, it ramped up very quickly, plus signing new business, and plus wehad just been acquired. Over the past year, we're 30 percent larger from astaffing point of view year over year. We're continuing to add talent to theorganization. We just hired Isabel Torres, so we're attracting top tier talent,someone we think is really going to help drive our growth going forward. Yearsago, someone like that probably would not have joined little old Reed &Mackay U.S. We're definitely seeing a steady stream of new business, and ourclient retention rates are still remaining high, the 97 percent range, and our [customersatisfaction] scores are doing very well.

BTN: Where are you seeing opportunities: Frompreviously unmanaged clients or winning clients from other TMCs?

Keichline: It's a mix. The smaller portion of it isunmanaged. It is coming mostly from competitors, from other companies that arelooking to us for the service you provide.

BTN: What type of service are you using as a sellingpoint?

Keichline: The big thing that we're seeing is thatcontinued need for a dedicated type of service, that high-touch service. Thereare a lot of things happening with technology—AI, online booking tools—andthose are fantastic, and we embrace that. A big portion of even Reed &Mackay's business is done online, not just with our parent company Navan. Butthere's certainly that market of professional services companies, law firms,professional services firms that still want that high-touch service, and beingable to continue to provide that is something we're focused on. We're notmoving to that call center environment. We're staying very much about dedicatedservice for our clients, and we don't see that going away, especially as morecomplexities are coming through the travel world with things like [New DistributionCapability] and different content. Also, they're facing a lot of economicchallenges, so they need more guidance, and that's what we're here to provide.

BTN: How has the acquisition by Navan changed whatyou can offer?

Keichline: Buying power for one—having those seniorlevel, high-level partner relationships has helped us. That allows us to bring differentvalue to our clients, because of that buying power. From a tech point of view,we have our own tech stack, and we continue to invest in that, but working witha company who is a disruptor and the knowledge share, speed of innovation,we've learned a lot from them. The investment was a big part as well. Comingout of the pandemic, a lot of companies had been through a very tough time. Theinvestment they were giving us allowed us to bolster our staff and invest inour technology. Reed & Mackay has always been nimble but methodical in ourthinking, and a company like Navan helps us drive that innovation more quicklysometimes, just the way that they operate. That ongoing investment that they'regiving us and the financial backing really helps. It's just all about helpingus to provide better services for our clients, and we can do it based on theclient need.

BTN: Were there benefits from Navan's otheracquisitions?

Keichline: Those acquisitions have been a little bit differentbecause they've integrated, whereas we remain a separate brand. The brand, thepeople and all the things we do are completely separate. Those were moreacquisitions that helped to bolster them in other markets, but they'veintegrated those companies into Navan.

BTN: We've seen some big consolidation moves thisyear, with American Express Global Business Travel's announcedacquisition of CWT and Steve Singh acquiringDirect Travel. Is there more of that to come?

Keichline: It's hard to predict. Consolidation ishappening quite a bit in the TMC world, but it happens in all industries. Wedon't tend to worry about predicting what are competitors are going to do froma consolidation point of view. For us, it's been making sure that we've keptthe value of the two companies from the time we were acquired. At the time wewere acquired, the market was probably looking at us like we were eventuallygoing to be integrated and the Reed & Mackay brand will go away, but it hasn't.We're really focused on providing that great service to bring somethingdifferent to the market. Yes, of course we keep an eye on our competitors, butpredicting it is almost impossible.

BTN: You mentioned ongoing work on your tech stack.What is happening with that?

Keichline: Our portal, R&M/Book, which is ourbooking tool, is going through a complete redesign. It will be launched in amatter of weeks. A new version will go out. Closely behind that will be a redesignof our mobile app as well.

BTN: Are you seeing in shift in client demand fordifferent pricing models, or are you still largely transaction-based?

Keichline: It is mostly transaction-based. Clientslike that and pay as you go. There are some clients who will pay a managementfee, they want specifics around what we're providing and the number of people,but the transaction fee model is definitely still highly prevalent and accountsfor most of our business. Coming out of the pandemic, we started to see thesubscription model—that's to protect the TMC, but why would a client sign upfor that? If we look at the market, we want to stay competitive. We're notnecessarily the cheapest, but we want to be competitive. The pay-as-you-gomodel works for the market.

BTN: What will Reed & Mackay's focus be forinvestment: staff, technology or training, for example?

Keichline: There's certainly a lot of investment intech, because there are lots of changes in the industry. Sustainability isbecoming a big part of the industry, so how do we build or tech to supportthat? We do see that while there isstill that big need for the high-touch service, online is probably going to getmore and more prevalent as the younger generation goes into more senior roles,and they're used to doing things on an app or online. So, we see we need to drivethat and make it very convenient for the users. The people part of it isanother part of the investment, and being part of Navan helped us just withthings like benefits. We're a small company and our benefits being better helpsus to attract and retain talent. For us, it is how do we get the best peopleand how do we take care of our people in the best way?

BTN: What about internal tech—not just what is forwardfacing to the client—and how does that kind of investment inform the trajectoryin the North American market for Reed & Mackay?

We need to work and invest in our internal tech, making ourpeople more efficient and make them want to remain working here. If we can makeit really easy for a consultant to service their clients, with everything attheir fingertips, they're going to like doing their job. It's a stressful job,but if you take that stress away by investing in great tech, that's going to bereally important. As a company, Reed & Mackay started in the UK, theystarted to go global in 2015. We've seen big opportunities here in NorthAmerica, and it's huge focus for the company. The UK market is still our largest,but there's a lot of opportunity here, so the investment luckily for me tendsto be coming towards North America quite a bit, making sure we have the besttech, the best people and the best infrastructure to deliver the best service.If we don't, we're not going to grow. It's a big country, but it's a smallcommunity to be dealing with law firms and financial services firms, so wecan't afford to get it wrong.

BTN: When you explore AI, are you looking more atinternal use cases or client-facing ones?

Keichline: In the short term, it's internal. We'vehad a lot of discussions about that. We could provide that type of informationat the fingertips of consultants, and that's where we see it coming. Navan hasa tool they use for booking. We're not there yet. That's probably a long wayaway for us. For us, it's about how do we use AI to help our people? It's thatfine balance. You don't want to scare consultants to feel like they're going tobe replaced. It's very easy for people to say, "Well, no one is going touse an agent in a few years." I don't buy that. I think there will be asmaller portion of it, but the way we position it to our teams is, makeyourself valuable. Make yourself indispensable and drive that service model. Tohelp them do that, by utilizing AI and embracing it as opposed to be fearful ofit, can really help us. If you think about the types of questions they get on aconstant basis and all of a sudden you start to build a profile where [someone]calls a consultant, and all of that pops up: "How was your trip to Romelast time? Did you want to stay in the same hotel? Were there any restaurantsyou liked?" Having that information pop up can be valuable. So, I thinkthere's a lot of opportunity internally to use AI. Let's not be afraid of it.Let's embrace it for what it can do, which is help our people be more efficient,so they are providing a better service.