Pat McDonagh is CEO of Clarity Business Travel
UK-based Clarity Travel announced the acquisition of competing TMC Agiito in August last year and went on to complete the deal in November. This month, Clarity has both formally launched its first proprietary booking tool and unveiled a new brand identity. The TMC's CEO Pat McDonagh answers our questions.
BTN Europe: How has the integration of the two TMCs progressed since the acquisition was confirmed last year?
Pat McDonagh: We had a really frustrating hiatus of three months or so [after announcing the deal] where we had to await regulatory approval and we couldn’t really do anything. That can be a little bit destabilising for people but there was not a lot we could do in that period. Since then, we’ve been working hard on bringing Clarity and Agiito together.
BTN Europe: How far along that process are you?
Pat McDonagh: There are distinct phases in the integration. The first one is the separation from the Capita business [from which Clarity bought Agiito] – you have to untangle the elements of Agiito that relied on Capita infrastructure – the Microsoft estate, for example. These are deeply practical things that you just need to be able to lift and shift. And we've been focusing on quite a lot of that over the last few months. We've also been bringing management teams together as well and simplifying structures so that we operate more as a single team.
Then there is the deep analysis phase, which is understanding how we do things, why we do them and what the best way to do it moving forward is. So from a customer perspective, that means they’re going to see ClarityGo [the TMC’s recently launched proprietary booking tool] as the booking solution for the most part – though we do offer third party tools such as Concur as well – and they’ll see MeetingsPro [an Agiito product] as the meetings management and venue-find software. I don't think anybody does both as well as we do.
This is the migration phase and that’s where we’ll be probably until the end of next year. There are still legacy systems and processes that have the Agiito branding on them – consolidated invoicing is still going from Agiito email addresses, for example. That might continue for a while because we want to make sure our clients get our invoices and that they get paid! Only at that point, probably by the end of 2025, can we say that we are a fully integrated, single operating platform and business.
BTN Europe: But the unveiling of the new look effectively also marks the retirement of the Agiito brand?
Pat McDonagh: It does, yes. We said from the outset it would happen and also that we wanted to create something that had the identities of both brands running through it. The initial work actually brought back some really interesting stuff and showed a commonality of mindset in the two businesses and a fairly aligned view from customers as well. It’s a coming together of two really quite similar cultures. We knew we both occupied a slightly different sort of space to a lot of our competition and it’s been really satisfying to see the brands come together.
BTN Europe: What’s been your message to Agiito customers who now find themselves on your books?
Pat McDonagh: I think you've got to go on a journey with the customer. They are very keen to understand, first of all, that we can give them the confidence that they're not going to be disrupted by this. And the answer is absolutely yes, we can. Because what you are getting today, you will continue to get – we're not doing anything with the resource assigned to your account or anything like that. We are gradually taking customers on that change between June and October and then come October, November time, there won't be a single touch point that isn't Clarity branded. Customers need to be eased through that process – nobody's going to be surprised and nobody's going to be rocked on the back foot.
BTN Europe: Has there been any pushback from Agiito customers who chose them over Clarity in a competitive bidding process?
Pat McDonagh: Naturally it happens from time to time, that a customer chose us or them over the other and we've exchanged clients over the years, as you can imagine. That happens when you are such close competitors. I think all they want is the reassurance that they continue to get what they've got. Neither of us really had a customer who'd gone from one to the other where there were bridges burned or huge challenges. We weren't wrestling any situation like that, I'm pleased to say.
BTN Europe: Steve Banks [formerly CCO at Agiito, now at the Focus Travel Partnership] and others have left the business since the acquisition…
Pat McDonagh: With anything like this, you will get some movement and that might be because somebody's decided the opportunity before them in the combined structure isn't the one they were looking for, or that there's a new opportunity somewhere else. That happens. We're also realistic that, down the line, there will be the duplication of roles, no shadow of a doubt, but we're also mindful of the fact we're in a really difficult recruitment market right now. Holding onto great talent is really important. So yes, there will be duplication, but if people are prepared to look at changes in roles or new responsibilities, then we will have new opportunities for them as part of the wider Portman Group.
BTN Europe: Is there appetite at the Portman Group for further acquisitions?
Pat McDonagh: I think that’s been demonstrated in the last year. In the same month that we completed the Agiito acquisition – which was not a small one and maybe surprised a few people – we made three acquisitions in sports travel in the space of two weeks. We've gone from businesses acquired in 2014 with a total transaction value of somewhere around £150 million to now closer to £1.2 billion as it stands this year [£750m from business travel, £300m from sports travel and £120m from leisure travel].
BTN Europe: Evolvi, the booking tool for UK rail used by many other TMCs, was part of the Agiito acquisition. What’s the opportunity there?
Pat McDonagh: Evolvi will continue to keep its independence and there are clear rules of engagement in place to protect customers. We don't share sensitive commercial information with the broader business and that's really important. I can't see what everybody else is paying.
In recent months, they've launched their split ticketing functionality which was a huge ask from the corporate client base. it's gone down very, very well. But we're keen that they innovate in other directions too. We're looking at things like international rail, as an example. I think everybody recognises that is a product gap but it's one we intend to close. We also intend to do it in a fashion in which it makes it easy for our TMC partners to consume it. So that will be hopefully within the existing API infrastructure, giving them a great opportunity to do this easily, to add it to their armoury, and ensure that from a fulfillment and ticketing management perspective it's not onerous. International rail is a big growth area for UK TMCs but it's not huge volumes, so it can't be complex. And when you've got a product like rail, which is 99 per cent online, it needs to stay there, doesn't it? So that's a big focus and we'll invest in that. We're not just expecting the [Evolvi] team to do this with the resources they've always had. We feel like the business has been due some investment and we're going to make sure it gets it.
BTN Europe: You recently launched your first proprietary booking tool, ClarityGo, but like others in recent times, you have waxed lyrical about the marriage of tech and service.
Pat McDonagh: I said on the way out of the pandemic that the battleground [for TMCs] was going to be service. I still believe that and we've lived and breathed that. That's where we're most successful in winning business. We've got amazing technology and I'm really excited about the alchemy of those two solutions. But our investment in service has been massive as well. We're members of the Institute of Customer Service and we are the only TMC with a Service Mark accreditation, which is a 12-month process. And we didn't just achieve the accreditation, we got a distinction. We are ranked number two in all industries in the B2B space. I think everybody can talk about service and how great they are but I can show you the certificate. I think that's a big differentiator.
In an additional conversation, BTN Europe spoke with Pat McDonagh at Business Travel Show Europe in London where the TMC was showcasing its new brand in public for the first time...