C13

1. C13 Distribution and travel trade

2. The tourism and travel industry is comprised of a complex, informal global network of independent businesses which form the 'travel distribution chain'. • The travel distribution system covers all the channels through which an international traveller can buy tourism product. • Other than approaching a business directly, international travellers may book a tourism product via: • Local travel agents • Tour wholesalers/ operators that market directly to consumers (direct sellers) • Inbound tour operators or meeting planners • Online portals or individual Internet booking engines.

3. Direct & indirect distribution in tourism system Client/Tourists Convention/ meeting Planners Corporate Travel Managers Retail Travel Agents Tour Wholesalers and Operators Incentive Travel Planners Elementary Service Suppliers (airlines, hotels, car rentals, other transport services, attractions, food services, DMO,…)

4. Retail travel agency • business that sells travel related products and services, particularly package tours, to end-user customers on behalf of third party travel suppliers, such as airlines, hotels, tour companies, and cruise lines. • In addition to dealing with ordinary tourists, most travel agents have a special department devoted to travel arrangements for business travellers • Rely heavily on Computer Reservation System (CRS) • IATA for those who issue their own tickets, • ATOL for those who order tickets in, • ABTA for those who sell package holidays on behalf of a tour company.

5. Retail travel agency • Global Distribution System (GDS)- to provide up to the minute detailed data on tens of thousands of flight, hotel, and car rental vacancies • Sabre • Amadeus • Worldspan • dynamic packaging tools to provide fully bonded (full financial protection) travel at prices equal to or lower than a member of the public can book online.

6. Tour wholesale & operator • middleman between the manufacturer and retailer • Typically combines travel components to create a holiday. • Plan, prepare, market and administer travel packages • Normally do not sell directly to end consumer • Wholesalers sell their packages (to the consumer) through retail travel agents, not to them. • In some cases tour wholesalers may sell direct to the public, generally through their own retail travel agency outlets.

7. Tour wholesale & operator • A tour wholesaler decides what type of "tour packages" would appeal to travellers, package the services accordingly and sell them. • Packaged tours are made attractive to potential travellers through lower prices than what travellers would pay if purchasing directly from the supplier • In some instances a tour wholesaler secures large blocks of advance reservations on airlines and for ground services such as hotels and sightseeing tours.

8. WHAT A TOUR WHOLESALER DOES FOR THE OPERATOR • A tour wholesaler links the various components of a tour or holiday to a particular destination (i.e. transport, accommodation, sightseeing, transfers etc.) and puts them together as a total package. • A tour wholesaler then designs a brochure to promote the package(s) and distributes it for sale. • A tour wholesaler supports the brochure with:- • An industry launch on its release • Travel agency familiarisations (to enable its "sales force" to experience first hand the product) • Journalist familiarisation tours (to gain PR and editorial exposure) • Consumer and travel trade advertising. • A sales representative force to call on travel agents.

9. INBOUND TOUR OPERATOR • The Inbound Tour Operator (ITO) acts to amalgamate the products of various suppliers in a destination/ country, for distribution to the wholesalers and retailers in the overseas market place. • ITO's provide an industry link, a distribution channel, between the suppliers located in the tourist destination region (TDR) and the overseas wholesalers/retailers located in the tourist generating region (TGR). • In general, their operations are based on the advantages to be gained from: • (i) Economies of large scale achieved by the consolidation of many small orders. • (ii) The synergy associated with this consolidation. • (iii) Intimate knowledge of local markets.

10. corporate travel managers • Act as procurement centre for all business travel activities • Objectives • Cut business travel expenses • Provide better services to business travellers • Increase corporate purchasing power Incentive travel planners • A specialised tour wholesale targeting businesses for travel as motivational tool

11. Meeting and convention planner • A meeting and convention planner coordinates all the activities of staff and convention personnel to make arrangements for group meetings and conventions, working as the intermediary between the client • Tasks: • Preparing budget • Selecting meeting site and facilities • Negotiation of rates for accommodation and other facilities/services • Developing meeting programs and agenda • Reservation for participants • Developing meeting specification and securing meeting space • Obtaining and coordinating entertainment • Planning for F&B • Coordination of print and A.V support materials • Administering the meeting site

12. online travel services • Benefits to customers • 24/7 access • Self-booking, potential of lower price • Trip planning assistance • Online price comparisons for various travel/hospitality services • Up to date information

13. Roles of distribution channels • Retailing at convenient locations for travellers • Expanding distribution network of elementary service providers as well as other intermediaries • Provide knowledgeable advice to travellers on destination, price, schedule and level of services • Assembling travel packages to create demand and value • Coordination of travel arrangements • Operating and providing guided tour services

14. How the Distribution System Works • The travel distribution system has traditionally been very structured, with clearly defined functions for each role in the chain. • However as technology and company mergers transform the tourism industry, there is an increasing amount of cross-over in the roles and functions of various sectors of the distribution system.

15. The InternetThe Internet has changed the way consumers research and book travel, impacting the traditional structure of the distribution system. • Many travellers use the Internet as an information tool when researching holidays, however, personal advice and recommendations from travel agents are still important, especially for long haul journeys. • The proliferation of 'last minute' websites to move surplus accommodation and fares has also changed consumer booking patterns, resulting in shorter lead times for bookings, even in some long haul travel markets.

16. What are Travel Distributors Looking For? Travel distributors seek product suppliers that can offer: • Quality products and experiences • Reliability (consistent operating hours and regular schedules) • Efficient operations and procedures • Friendly, helpful reservations staff • High levels of customer service • Stable operations • Pricing policies that consider all levels of distribution • Communication via email, toll free numbers and fax, and • Fast and efficient turnaround and response times.

17. Marketing mix for travel intermediaries • Trade advertising – paid advertising by primary suppliers aimed at the intermediaries • Importance of timing • Directories and computerised database system – • Trade promotions – • Familiarisation trips • Incentive programs • Giveaways • Trade shows • Personal and telephone selling • Merchandising and broachers • Public relation and publicity • Partnership • Web presence/access – online trade support

18. Distribution channels and consumer purchasing behaviour varies from market to market so you will also need to understand the structure of the distribution system specific to your target markets. • When considering how best to distribute your product to international consumers, it is important to understand each channel and the relationships between companies within the distribution channel.