Rearden and Southwest Team Up — A Prescient Spend Management Travel Combination

Earlier today, Rearden Commerce (click the following links to see our recent commentary on this unique provider you should know about if you don't already: Part 1, Part 2, and Part 3) announced it was teaming with Southwest Airlines to expose "direct access to Southwest fares and schedules," within its Commerce Platform. The result, they suggest, will "simplify the reservation process for travelers" and will help consolidate "reporting efforts for travel and procurement" on the back-end. Under the agreement, there will be type of travel punch-out to Southwest's site required.

Rearden suggests that when "a traveler books a Southwest flight, they will go through the same" single screen (desktop or mobile) as usual. Moreover, the Rearden platform will enable them to "automatically populate their Outlook or Lotus Notes calendars with Southwest bookings, receive timely and up to the minute flight and gate status to their devices ... [and to also] track and apply unused funds." In addition, Southwest will show "live availability and last seat inventory" and much of the same capability on the Southwest business booking site already available today including the ability to support deferred ticketing, canceling reservations, retrieving reservations and "exchanging funds towards the purchase of new itineraries."

For those outside the travel procurement business, this might not sound like an important announcement, but it is for a number of reasons. For one, Southwest has traditionally tried to practice disintermediation in terms of traditional travel sites and other intermediaries, preferring to drive business travelers to its own portal (especially outside of the booking itself). By working with Rearden, Southwest is clearly making a statement that this chosen partner is fundamentally different than others in the market, especially given the overall broader integration. No doubt, this move is part of Gary Kelly's (Southwest's CEO), program to "have a bigger push and a stronger message for business travel over the next 12 months," as he recently told media and Wall Street analysts.

For Rearden users, the move is also prescient, as many of its business customers from Fortune 500 to SMB are no doubt taking a closer look at expanding their relationship with Southwest given the higher total cost equation -- which is often masked at booking time -- of other airlines. Because Southwest does not charge a penalty for ticket changes, checked bags, etc. even a higher cost fare quotation may be significantly less than the actual total cost involved in a trip on another airline. At our office, Southwest is the Spend Management airline of choice for this reason (I personally keep just enough miles on United to get the Premier Exec treatment for international flights, but aim for Southwest whenever possible and when I know I need to get home on time).

As a final point, this move shows how Rearden is looking out first and foremost for its customers' best interests. By proving they can work with Southwest now, there will no doubt be many other relationships down the line built around what business travel customers want -- and optimizing the total cost travel equation.

Jason Busch

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