Solutions to the Travel Agency Problem
Part 4 of a series about Travel Agents
local corner store travel agency - soon to disappear? Major changes will
occur in the ways travel is sold via retail outlets.
4 of a 5 part series - click for Parts
Thousands of travel agencies
are closing their doors. Thousands more will probably close in
the next year.
What can travel agencies do to
assure their survival? Or are they as obsolete as full
service butcher shops, overwhelmed by the new competition posed
by the internet?
Here are four suggestions.
Will Travel Agencies Survive?
Travel agencies have
resisted change for decades. Corner grocery stores have
disappeared, local hardware stores have been replaced by
discount superstores, even video stores are now dominated by a
few chains, and now, finally, it seems that rationalization and
change is coming to the travel industry too.
The successful travel agency
of tomorrow will be very different to the successful travel
agency of yesterday. Here are some areas in which change is
essential and inevitable.
Solution 1 : Formal Training
Most countries require
travel agents to undertake formal training, regular continuing
education, and possibly licensing before they are allowed to
sell travel products - similar to that required for realtors. In
the US, anyone can call themselves a travel agent, usually with
no need for any formal training or qualifications at all.
The lack of formal training
means lack of quality control. If travel agents were more
consistently trained, then there would be fewer 'bad' agents
spoiling the reputation of the good agents, and the overall
appreciation of travel agents would be much higher.
Travel agents also need
specific training and experience in the products they sell. How
can an agent sell, eg, Vienna, if they have never visited the
The public will only use
travel agents when the agents know more about the things they
sell than the public can conveniently find out for themselves
(eg on the internet or direct from suppliers). The public is now
better informed than ever before. Travel agents need to likewise
also be better informed than previously.
Solution 2 - Specialization
The concept of the
multi-purpose agency being able to help everyone about every
type of travel, everywhere in the world, is no longer valid.
With convenient direct access to travel information these days,
travelers expect more from a travel agent than they formerly
Travel agencies need to
specialize in one of several ways. They need to perhaps
specialize by type of travel (eg cruise only agencies) or by
destination (eg Australia specialists) or by type of passenger
(eg gay travel specialists) or perhaps (a new concept), they
need to specialize and sell in conjunction with only one or two
partner suppliers (even airlines). Perhaps they might also
specialize in providing contract travel services to specific
major customers, rather than general travel services to the
Specialization also helps
with training - it is easy for an agent to become an expert on a
specialized sub-field of knowledge that it is for the agent to
become an expert on everything.
Solution 3 - New Approaches to
The corner travel agency
needs to change and evolve as the world around it also changes
One example are the travel
'super stores' that can occasionally be found - huge stores that
have a series of smaller specialized niche travel operations,
all as part of the one major store.
Another example is mixing
the internet into how traditional travel agencies interact with
their customers, making it easier for agencies to get clients
from all around the world - which also makes it more practical
to specialize in small niche markets, rather than being limited
to the local community.
Another example is selling
travel consulting and advice on an hourly rate basis, while
allowing people to make their own travel arrangements direct
with suppliers. Some corporate agencies are in effect doing this
Agencies need to get
involved in joint venture activities with each other and with
suppliers, so as to leverage the promotional budgets and
activities of several different partners.
The internet is a 24/7
service - travel agencies need to also offer service at hours
that are convenient for their clients, not just at hours that
are convenient for themselves! The internet can enable agencies
to sell to clients anywhere in the world, but then the agencies
need to have real people available to interactively help their
customers in all time zones and at all times of the day and
Solution 4 - Become a Broader
Based Supplier of Travel Related Products and Services
Travel agencies need to
profitably participate in meeting all the travel related needs
of their clients. That means possibly selling luggage, travel
books, and travel accessories.
Compared to traditional
travel sales with a 10% margin (and air tickets with a zero
percent margin), these items can give as much as a 50% (and
sometimes even larger) margin. It is possible to make more money
selling a suitcase than a tour! :)
It also means that travel
agents have to provide more directly travel related services -
integrating theatre ticket booking, limo transfers, day touring
and other services into the products they offer. Which again
means a need for greater training and knowledge.
Tomorrow's Travel Agency
It is easy to shed a
sentimental tear for the steady demise of the 'mom and pop'
travel agency. They seem destined to follow the 'mom and pop'
video store, the m&p grocery store, etc etc, into oblivion.
But the new type of travel
agency that evolves will be a very efficient and effective tool
that truly makes travel planning easier for their clients and
offers an efficient way of selling to their suppliers. And that
has to be a good thing for everyone!
Read more in the rest of this
Part 1 we discuss how travel agents can
help you better than supplier representatives can or will.
Part 2 we explain that the airlines'
zeroing travel agent commissions isn't just an attempt to kill
off travel agents, but also an attempt to kill off smaller
airlines. Both ways, you're the real loser.
Part 3 we talk about the bad reputation
travel agents generally suffer from, and why some of it is fair,
but much of it is very unfair.
Part 5 represents a
bringing together of both this article series and also the
series on how to choose a travel agent and agency, and talks
about ways in which you can now best use travel agency services.
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19 April 2002, last update
19 Dec 2013
You may freely reproduce or distribute this article for noncommercial purposes as long as you give credit to me as original writer.