Online Travel Sales Competition

By: David J. Wardell


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© 1999 By: David J. Wardell.  Reproduction or redistribution in any form without written permission is strictly prohibited.

HAVING NOTHING TO SELL

TRAVEL AGENTS BUMS?

DELIVERING VALUE

ONLINE CAST-OFF SHOES

AGENT BUSINESS STRENGTHS



TRAVEL WEEKLY CROSSROADS POSTING - MARCH 24, 1999

Here in the Washington, DC market, one of the largest online travel booking services is running well-produced commercials describing the virtues of their product. The scene is the familiar encounter where one traveler is amazed and depressed because the person sitting next to him paid so much less for all parts of his vacation (air, hotel, car). The focus of the ad is that the CRS behind the booking service contains so many choices and so much information that surely a person will be able to find that really great deal.

Hmm ... the premise strikes me as a bit like maintaining that owning an encyclopedia almost guarantees a good thesis. Eventually a bit of experience and expertise needs to enter the equation—as with a reliable travel agent. But, what do I know? Having little or nothing to sell in the Internet travel game doesn’t appear to be a serious short-term impediment to many folks.

WHAT IS THE COMPETITIVE MESSAGE
TRAVEL WEEKLY MAY 6, 1999

Recently on the Travel Weekly Crossroads Technology Forum, which I moderate, a discussion centered on the lack of substantial content offered by many on-line travel sellers. One person sent me a private note questioning how agents can convey the value they deliver in a world that demands services cheap and fast, and that is all too ready to believe that travel agents are bums.

Any service industry is about delivering value. Years ago enlightened people observed that agents who did little more than take reservations and print tickets would find themselves easily replaceable.

We are seeing that prediction proven true, but one should not conclude that all agents are in the same position or that agents lack a competitive message.

In today's electronic travel world promotion and enthusiasm are everything--substance is often taken for granted or ignored. Insane and unsustainable stock market valuations and the predictable pronouncements from various gurus about the limitless potential of cyberspace contribute to the view that on-line is the only real future of the travel industry.

People appear willing to let a few fairly small businesses, most of which are unprofitable, dictate the terms upon which the travel industry competes. Rather than expend the energy to run their own race they are content to wear the cast-off shoes of the on-line industry by offering too little in a realm where they can never spend enough to be effective.

As you start thinking about describing your business strengths, whether you are an on-line or a more traditional agent, remember that most on-line products don't receive nearly the critical attention they should. Apart from the fact that the tools are usually functionally very limited, they require an extraordinary investment of time and energy from the user.

The goals many software developers have set, to the extent they can be described usually center on building an "agent in a box" rather than delivering what the customer really wants to buy (which is not the same thing).

More seriously, many of the on-line businesses themselves are moving in the wrong direction, as ought to be evident from their never-ending development and never quite here profit pictures. One ought not to view either technology or market capitalization as any reliable indicator that some of these businesses have much of a future unless they get better in touch with commercial realities fairly quickly.

I am not questioning the future of interactive technology, nor am I saying that every on-line travel seller will not succeed (neither of which I believe), but the tendency is to view these companies as a block rather than as individuals that have their own strengths and weaknesses.

Today agents are a far simpler, less intrusive, more comprehensive, more extensively tested and proven, and convenient travel booking source than self-booking platforms. More important, agents are able to deliver expertise and consumer advocacy that are consistent with what customers repeatedly prove they want to buy based upon where they write their checks.

Expensive and naive media promotions explaining why travel agents are bums notwithstanding, this is a compelling and powerful message.

Changing this picture requires a leap of faith, which says that the on-line product in question will deliver sufficient legitimate value over time to overcome what is a substantial present-day operational and customer service disadvantage. Not impossible, but far from a certainly in some cases and surely an area where both on-line products and businesses require further development before they become the competitive powerhouses many people believe they should be.