ACTA Panel: Suppliers Discuss Role Of Travel Agents In Distribution
Bruce Parkinson, Open Jaw
What keeps travel professionals awake at night?
A recent ACTA survey found that for both agency owners and frontline advisors, competing with suppliers for bookings, the expansion of non-commissionable pricing components and downward pressure on commissions are some of the key issues interfering with a good night’s sleep.
So it made perfect sense that the recent ACTA Travel Industry Leadership Summit featured a panel of suppliers discussing where travel agents fit into today’s multi-level distribution environment.
The diverse panel covered the bases with representatives from a major cruise line, the world’s largest hotel company, an ITC operator, a car rental company, travel insurance provider and a guided touring company. The moderator was Louise Gardiner, an ACTA Board member and VP of The Agency Solution by The Travel Agent Next Door.
Gardiner asked questions of each panel member on issues involving the travel trade distribution channel, and members of the audience were invited to submit their own.
Agents Deliver Revenue & Quality Clients
One thing became clear from the conversation – agent bookings remain an important source of revenue and quality clients for travel suppliers. That’s nothing to sniff at, considering that a few short years ago the complete annihilation of the retail channel was widely predicted.
Another takeaway: while the percentages vary by segment, suppliers are going to fill their rooms, seats and cars any way they can – through direct and indirect means – and adding value to the transaction is essential for continued relevance.
For four of the six members of the panel – Andrew Dawson, COO, Sunwing; Ron Gulaskey, AVP North America, National Accounts & Trade Relations for Celebrity Cruises; Rob Iafrate, AVP, Travel Insurance, Manulife; and Brett Walker, General Manager, Canada for Collette – retailers make the vast majority of bookings. For Sunwing, Celebrity and Collette the percentage is in the 80% range.
“Agents are an integral part of our business,” said Sunwing’s Dawson. “They add value to the process because in the online environment there’s an overwhelming sea of resorts to choose from.” Agents add value by using their knowledge and travels to help consumers narrow the choice and pick the property most suited to their tastes.
Collette’s Walker said a complex and premium product requires expert selling.
“We develop and curate guided touring products. We don’t do what you do. That’s why our call to action is to work with a travel professional.”
For Manulife’s travel insurance products, agent expertise and relationships with travellers makes them essential. “We’re an auxiliary offer, and our sales are contingent on the core travel product being sold,” said Iafrate. “Agents are essential to the business and will remain so.”
The Multiple Channel Reality
But in a fiercely competitive environment, suppliers say they have to cater to the variety of ways travellers choose to book, which requires nurturing multiple channels.
“We have to invest in all the channels to fill our rooms every night,” said Cynthia Perry, Global Director, Travel Industry Sales for Marriott International. “That said, agent bookings drive a higher Average Daily Rate and their clients spend more on-property. That’s why we continue to invest in agents.”
The same goes for car rental. “Agents are critical,” says Jay Pope, Director Travel Agency Sales, North America for Enterprise Holdings, home of the Enterprise, National and Alamo car rental brands. “But we also have to work through multiple channels and respond wherever that customer may be.”
Home-Based Growth Adds Challenges
With more and more travel advisors shifting to a home-based environment, it’s becoming an increasing challenge for suppliers to find, educate and inspire agents to promote their products.
“One of the things we struggle with is where all of you are these days,” said Collette’s Walker. “It’s a huge challenge. If we don’t know who’s selling, we can’t do education and outreach. But if we have a good partnership we can figure it out.”
For Celebrity’s Gulaskey, partnership means investment by both sides. “Some consortia have 35 preferred cruise lines. We’d like fewer. And sharing business intelligence on both sides is important too.”
While Celebrity does have direct-sell teams, because that’s the way some cruisers want to book, Gulaskey says they don’t have group space or headquarters group space that agents and consortia do.
“We give things to travel partners that our inside sales team doesn’t get. You’re Switzerland to them. You sell the best product for that customer. And that gives us the right clients for what we offer.”
The Distribution Panel at the recent ACTA Travel Industry Leadership Summit: (left to right) Brett Walker, Collette, Cynthia Perry, Marriott, Ron Gulaskey, Celebrity Cruises; Jay Pope, Enterprise Holdings; Rob Iafrate, Manulife; Andrew Dawson, Sunwing.
Bruce Parkinson Editor-in-Chief
An observer and analyst of the Canadian and international travel industries for over 25 years, Bruce uses the pre-dawn hours to prepare a daily news and information package to keep industry members up to date.