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Solutions to the Travel Agency Problem

Part 4 of a series about Travel Agents

The local corner store travel agency - soon to disappear?  Major changes will occur in the ways travel is sold via retail outlets.

Part 4 of a 5 part series - click for Parts  One  Two  Three  Four  Five



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  Corner grocery stores have disappeared, local hardware stores have been replaced by discount superstores, even video stores are now dominated by a few chains, and now, finally, it seems that rationalization and change is coming to the travel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 Programs

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 city themselves?

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concept of the multi-purpose agency being able to help everyone about every type of travel, everywhere in the world, is no longer valid.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 did.

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 general public.

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 Market

The corner travel agency needs to change and evolve as the world around it also changes and evolves.

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 already.

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 night.

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 series

In Part 1 we discuss how travel agents can help you better than supplier representatives can or will.

In 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.

In 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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Originally published 19 April 2002, last update 21 Jul 2020

You may freely reproduce or distribute this article for noncommercial purposes as long as you give credit to me as original writer.

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