Hands off my client! | TravelResearchOnline

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Hands off my client!

In February, Travel Market Report ran an article that discussed some fundamental shifts in the way that travel suppliers are doing business. While I still firmly believe that most suppliers are making a decided shift to net rates and direct bookings, a new tactic was brought to light in this article.

Some travel suppliers are essentially operating as travel agents representing other suppliers’ products. Imagine the nerve! I suppose the blame can be placed on the big three OTAs (Online Travel Agency), Orbitz, Travelocity and Expedia. What started out as an online means to distribute airline tickets, quickly morphed into a full blown online travel agency complete with cruises, tours, hotels, car rentals, insurance and fees! It was only a matter of time until the actual suppliers caught on and decided that they too can be travel agents.

As virtually every cruise line executive has said, until the agency community steps up to the plate and can fulfill 100% of their capacity, they will seek alternate means of distribution to fill in the difference. While we may not like to hear it, we have not done a great job. The first time I witnessed it was when Frontier Airlines was trying to get market share from America West. When America West eliminated commissions, Frontier stood firmly behind the agency community and held the line on commissions. They were not shy telling us what they expected in return. After 6 months, the market share for Frontier actually dropped. And this is how the industry rewarded Frontier for sticking up for us! So, on one hand, I really can’t blame the suppliers for looking out for their own bottom line—we do it for our own respective businesses.

So, now it appears that we will have more competitors fighting after the same disposable income from the consumers. Are you prepared to fight for the business? Do you have a plan to set yourself apart?

We can all talk about the personal service we offer that a website does not until the cows come. But the fact remains is that many consumers are comfortable completing major transactions completely online. I just read an article about a Canadian funeral home that has launched an online business model! Yes, we can give personal service. So what? You need to take a hard look at your business and see what it is that truly differentiates you from your immediate local competition and these big players who are better funded and more aggressive.

Like City Hall, fighting the suppliers will be next to impossible. They quite likely are receiving equal or better compensation from their “partner suppliers”. They certainly have larger budgets for marketing. And perhaps the largest asset they have is their brand. When coupled with the marketing reach their budgets can buy and a well known; usually trustworthy brand name, our suppliers could very well become one of our largest competitors.

Imagine a world where a customer is looking for a Caribbean cruise. They spend a few hours researching the itinerary and cruise line and have committed to a particular sailing. The next logical step is to check the pricing. Of course they go to the cruise line’s website. They probably go to one of the big three OTAs. They do a Google Shopper search and all of a sudden YourFavoriteSupplier.com pops up with the lowest price. That supplier has a great name and great brand recognition. So with the client that knows what they want, where are they going to buy?

Once again, the industry is throwing up a sign for you that must specialize to differentiate yourself from the crowd.  Are you reading them?

  8 thoughts on “Hands off my client!

  1. Geoff Millar says:

    I agree 150%. IF you don’t specialize and know more about a particular area of travel than the client does, their immediate reaction is going to be, what do I need you for? You have to bring something extra to the table or one of two things will happen, they will go elsewhere or price will become the deciding factor.

    The airline example is great one. We have to realize we are no longer order takers but full blown sales people and we must support those suppliers that support us. If we don’t sell a suppliers product they will find a way to sell it themselves or through another channel like the online companies.

  2. I also agree, you have to specialize your business or your ways of selling. It all started around 911. We (Travel Consultants) where feeling the Internet was our next big obstacle. But, we were still upset with the airlines capping, depleting and deleting our commissions. Trying to offset our losses we had to start adding service fees. The Internet just came out with easier ways to book your flights, hotels, and cars on line without service fees. Now Company’s and individuals could save a little money and every penny counts these days. It seemed like, in one month after the disaster most Travel Agents was hurting for business or closing some doors. That is when I changed from being a Corporate Travel Consultant to a Dive Travel Consultant/Instructor. You have to specialize!

  3. JESS K says:

    Just sort of thinking out loud: What if an agency was “specialized” in a niche market, say like New Zealand, Australia, Thailand, Japan, Myanmar et al who have all suffered hideous natural disasters; Earthquakes, floods, and other calamities. Where would that agent be now? OUT OF BUSINESS! Hawaii is estimated to lose upwards of $20million in tourism from Japan alone. I do agree that we have to know more about destinations, BUT we must be well rounded and not “put all of our eggs in one basket”. Order takers will not last in todays world in travel and tourism. One must know, or have immediate access to, a myriad of destinations around the world. Tourism to Mexico is down drastically because of negative publicity. What if an agency specialized just in Mexico? OUT OF BUSINESS. Even long term wholesalers who traditionally, in the past, who specialized in one destination are now spreading their wings and adding other destinations to their portfolio. I would much rather be a well rounded travel agent that could serve ALL of my clients needs, not just to a narrow choice of destinations. The swing is definitely AWAY from OTA’s because people have gotten burned, or simply do not want to waste the time and effort to do all their own research and bookings! We have clients calling us again that we have not heard from in over a year, saying they simply do not want to waster their time, or they got burned on their last trip. We garnered MANY new clients when the Iceland Volcano exploded last year, referrals from our existing clients who were handled in minutes! Not days or weeks! One National “travel guru” got stranded in London for over a week. DUH! If his was as smart as he contends on National TV he should have known how to get from London to New York and avoid the Iceland Volcanic eruption! He is too busy offering “deals” and ways to circumvent travel agent to REALLY know what he is talking about! I am Proud to say I am A Professional Travel Consultant, having traveled to 133 countries, and can fully discuss anyone of them with my clients, and sailed over 100 cruises, and can discuss those as well.

  4. Ray Espino says:

    I completely agree with the second comment that we must be well rounded travel agents.

    I have sold tours to countries I have never visited, but by having general knowledge, and sales skills you can close the sale. If we intend to succeed in todays travel we need to diversify.

    Just imagine a Ford Dealer only selling Fords, and telling a walk-in “sorry we don’t sell used Honda’s because we are Ford specialists”

    Doesn’t work.

    I have attended several travel events (consortia, travel associations), and have gotten into a few heated arguments face to face with these so-called travel gurus who have never actually sold travel, but tell you that you need to specialize.

    How would a Cruise only Travel Agency look like if “God Forbid” terrorists blow up the Norwegian Epic, or one of these Mega Ships with 5,000 passengers in the middle of the sea? Haven’t thought about it? a cruise is actually a very easy target. out of business.

    I’ll say it again. We need to diversify. (just like your 401K) if you actually have one.

    Look at what the Mexican tourism dept. has done. American bookings are down, (not in our agency), but overall tourism to Mexico is up by 4 million travelers a year because they realized they cannot count on U.S travelers alone, and started marketing in Europe, Asia, and South America.

  5. Gabriele Mecca CTA says:

    The biggest mistake I believe travel agents have made is to give away lots of information (without being paid for their time) to then have clients narrow down their research and book their own travel arrangements. That is their choice. Our choice is simple: let’s get paid for our time! Let’s be up-front about our fees – we can always credit some of it back to the client if they book with us:)) The smart thinking is this: the client will continue to get valuable information and WE get paid! That is where we need to step up to the plate because most people still love word of mouth recommendations – not a search engine with encyclopedic information on where to go and what to see. Just my few cents:))

  6. MARYANN says:

    Jess, I agree with you.

    We do specialize in the Portugal ethnic market, but we have a storefront & get many local clients as well as many referrals. One is the bread, the other the butter.

    Out of curiosity, who is the “travel guru”?

  7. John Frenaye says:

    Jess–there is no telling what can happen in a natural disaster. Hopefully a business plan is well enough planned to allow SOME flexibility. If a plane crashes into my office today, I may be out of business. It is a risk one takes. I would not specialize in Tripoli vacations due to the political turmoil. But if I had chosen that specialty, I would assume that my insurance might cover a loss of business (assuming that we did not see it coming when we started).

    But the disasters you spoke of did not happen to all of those all at once, and just like 911, and every other event in the industry, we need to be able to react, adapt, change, etc.

  8. John Frenaye says:

    That particular guru was Peter Greenberg

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