Tourism and Travel Distribution: the Travel Agent's Perspective By Dr Marion Bennett and Dr Dimitrios Buhalis, Centre for eTourism Research (CeTR), School of Management, University of Surrey, Guildford Jan 2003
The Internet has revolutionised the tourism industry and has generated a number of challenges and opportunities for all players. For travel agents, in particular, the Internet is changing the industry structure and consumer behaviour. Significantly, technology forms part of the strategy to enable travel agents to maintain a presence in the chain of distribution. If agents are to survive, technology will have to become an essential tool incorporated in the future business strategy determining their competitiveness. In this sense, technology is both a threat and an opportunity, as travel agencies need to readjust to the new realities. Re-intermediation via the Internet and IDTV (Interactive Digital Television) present potential opportunities for innovative players who utilise the emerging tools. This article analyses the key Internet trends in relation to the travel industry. It also considers strategies travel agents can employ to ensure their future survival. The role of the travel agent
It has long been recognised that tourism and technology are a highly compatible couple. The nature of service distribution revolves around the notion of intangibility and perishability, therefore, the manner in which information is communicated is highly important. Historically, in the tourism chain of distribution, this role has largely been undertaken by the travel agent who acted as the information broker between the supplier of services and consumers. The travel agent was, therefore, the early beneficiary of developments in technology, such as the CRS and GDS. More recently, developments in Internet distribution and, in particular, e-commerce have threatened to take over the role of these systems. The role of the travel agent has been to act as an intermediary and retailer, selling travel services on behalf of principals for a commission. They also had a significant role as advisers for consumers and providers of ancillary services, such as travellers cheques, currencies and travel insurance, as well as obtaining passports and visas. They also provide access both for the principal (access to the market) and the consumer (a convenient location to purchase travel services), as well as acting as a key source of advice in a customer-focused environment and on a person-to-person basis. The first two elements of their role are gradually being eroded as ancillary services are increasingly available from other sources. Travel insurance, for example, can be purchased from high street outlets. Access to the product is also being eroded by technology, in particular the Internet, as a wide range of information is now available online. Both virtual travel agents and principals are now providing e-Commerce purchasing opportunities online, offering a highly convenient location for principals and consumers in both time (24-hour accessibility) and place (access from potentially anywhere). Where travel agents remain unsurpassed is in their ability to offer a personal service. Naisbitt (2001) refers to it as 'high-touch', the antidote to 'high-tech'. It is becoming increasingly evident that agencies will need a 'high-touch high-tech' strategy to satisfy the customers of the future (see Table 1). TABLE 1: ARGUMENTS FOR AND AGAINST THE DISINTERMEDIATION OF TRAVEL AGENCIES| Arguments for the disintermediation of travel agencies|
* Travel agencies currently add little value to the tourism product, as they primarily act as booking offices * Travel agencies merely manage information and undertake reservations * Travel agencies are biased, in favour of principals who offer override commissions and in-house partners * Experienced travellers are much more knowledgeable than...