The Association of British Travel Agent’s (ABTA) recent congress on Kos gave delegates some tasty food for thought. During the four-day event, which was perhaps the best-organized event ever held in Greece, up-market speakers attempted to foresee the future regarding travel and the Internet.
It all began quickly with the opening address to delegates by Steven Bath, ABTA’s president. He renewed his attack on the Internet and reiterated comments he made at last year’s ABTA convention when he told agents they were better off investing in their shop than the Internet. “If this was a gold rush the only people who would be making any money would be those who selling shovels,” Mr. Bath said, “Agents would be far better of investing in shop improvements than on the Internet.”
In the address, he also urged the industry to stop its suicidal discounts. Mr. Bath blamed poor salaries in the industry on the obsession with discounts.
Following the opening address, Stefan Pichler, chief executive of Germany’s C&N Touristic, began the series of convention talks with “A wake up call for the travel industry.” Mr. Pichler said that one in ten holidaymakers would book their holiday through the Internet within five years. He predicted it will change consumer’s buying habits and said that 10% of the operator’s business will be driven through the Web by 2005.
First Choice’s Group chief executive, Peter Long, hit out at Internet start-ups the sell travel. He called them parasites. Mr. Long said most start-ups would be short lived and that they were fronted by people who had no idea on how to run a business. There is no foreseeable reason why these Internet companies will work, he said. “These parasites are coming into our industry and adding absolutely no value whatsoever.” He reminded that some nine months ago the word was that American old-economy companies were all going to die because they were all going to be taken over by Internet companies.
Malcolm Preston, a partner at Pricewaterhouse-Coopers, said that travel agents must become expert Internet users if they want hang onto their customers. He said agents do not need to invest thousand of pounds in new technology to survive but they do need to know what travel product is available on the Internet so that they can stay one step ahead of their customers and provide advice on useful sites. Travel agents must become expert Internet users if they want hang onto their customers. “How often does a customer come in and say they have seen something somewhere on the Internet? You can start to add value to customers better than anyone else by getting to know the web better than them,” he said.
Mr. Preston added that while consumers are more likely to buy travel on line than any other consumer product, research shows that most people would rather deal with an agent directly. “But agents shouldn’t take as a reason to do nothing.” Lastminute.com’s managing director, Helen Baker, said she asks suppliers to give her Internet company full-priced holidays. Selling at the last minute is not just about selling cheaply, she stressed. As far as the travel side of our business is concerned, a lot of what we sell is not discounted, she said. I wish that the travel industry would actually use us more.
“People give us cheap holidays and them criticize us because we sell cheap. I challenge people to be a bit more open-minded. Give us the full-priced holidays. We have sold last-minute hotels for Valentine’s Day, when people are ready to pay high premiums.”
A MORI survey, commissioned by ABTA in 1998, indicated that less than 1% of holidaymakers had booked their last package holiday through the internet. Despite predictions that this would increase vastly in the future, the reality has been less dramatic. MORI research conducted in September 2000, showed that only 3% booked their last package holiday online – although 17% had used it to book some travel service at some time.
Almost 40% indicated that they have already used the internet as a source of travel information and 56% of those surveyed already have access to the internet, at home, at work or in another place. Those with access, but who did not book over the internet, cited a number of reasons for their decision. Topping the list was a preference for face to face advice (18%), lack of internet access at the time (16%) followed by worries about security (14%). A lack of convenience and access to better bargains elsewhere was mentioned by 10% each.
ABTA’s president, Stephen Bath, said: “Clearly the internet and digital technology has exiting implications and challenges for our members. ABTA’s own recent advertising campaign has focused on the Internet trading. As he internet continues to develop, many of our customers will want reassurance about the companies they might deal wit online.”
Thomson Holiday’s managing director, Shaun Powell, concentrated on holidays, not the Internet. He said that long haul travel in general is suffering while short haul is getting better value for money. “It is getting harder and harder to sell long haul.” He said that long-haul destinations suffer from effects of increased fuel prices and the high value of sterling.
A recent study by the Tourism Intelligence International organization says that British travelers will show preference for long haul rather than European destinations -without assistance of travel agents- over the next five years.
Researcher Auliana Poon undertook a study for Tourism Intelligence International which found that around 79% of all trips undertaken by Britons involve European destinations, compared to 90% among German travelers. Although Britons are pressured to purchase package tours, there is an emerging trend towards independent travel with around 46% of all trips falling under this category.
In air transport, fare prices on no-frills airlines are very competitive and are often not a great deal higher than those offered by charter companies, the report found. Additionally, travelers are often able to purchase seat-only.
In the area of accommodation, it appears increasing numbers of Britons are entering into timeshare agreements, which also affect the package tour market. Many hotels offer online booking, allowing travelers to choose their accommodation rather than be limited to those provided through package tours.
Near the close of the congress, and despite initial fears of low attendance, the Association of British Travel Agents said it welcomed a high turn out at its annual convention. Some 1,784 delegates converged on the island of Kos and organizers were pleased: “Our best estimate was for approximately 2,000 delegates; our break-even figure was 1,700, so the fact we have received just 1,800 has proved that the convention has been a success,” said ABTA spokesperson.