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The Changing Face of Travel Distribution

The Changing Face of Travel Distribution. Channel planning: harder than tri-dimensional chess?. Dimensions to consider: Reach Ease of comparison Cost of sale Brand reinforcement Relationship potential Customer preferences Customer satisfaction Product type Decision context

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The Changing Face of Travel Distribution

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  1. The Changing Face of Travel Distribution

  2. Channel planning: harder than tri-dimensional chess? Dimensions to consider: • Reach • Ease of comparison • Cost of sale • Brand reinforcement • Relationship potential • Customer preferences • Customer satisfaction • Product type • Decision context • Buying process stage • Technology choices • Scalability

  3. Information economics affect channel strategy

  4. Value to customers Price Choice Control Information / – Customer service Advice Payment options Online travel agents’ value • Value to suppliers • Efficient reach • Customer access • Market demand feedback • Sales expertise / innovation • Outsourced customer support • / – Quality of representation • Loss of relationship control • Commissions / fees

  5. Web is widely used source of information % using ... for any research NB data relates to package / accommodation purchases

  6. Web’s role in holiday planning NB data relates to package / accommodation purchases

  7. Web becomes part of the process % of adults Base: All adults who have taken a holiday since May 2002, July 2003

  8. Browsing and booking trends % adults who cited PC Internet as method of … for last holiday purchase Base: Adults who took a holiday in the previous 12 months

  9. Brochures’ role in holiday planning NB data relates to package / accommodation purchases

  10. Agency staff role in holiday planning NB data relates to package / accommodation purchases

  11. TV’s* role in holiday planning * programmes/ads only NB data relates to package / accommodation purchases

  12. All Leisure Travel All Holiday and VFR trips taken by UK Nationals (000) 140,000 120,000 100,000 80,000 60,000 40,000 20,000 0

  13. Leisure air travel subsegment forecast Full Flight-based International Independent Trips (000) 20,000 18,000 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2,000 0

  14. Leisure travel channels ecosystem - 2003 Mass market Seller focus Tour operator owned travel agent Lates specialist eg Teletext, Cheapflights, Bargainholidays TV travel channel Independent high street travel agent Direct supplier sites eg Holiday-inn, easyjet, BA.com General online travel agent eg Expedia, Opodo, Travelocity, ebookers High Low Shopper confidence Ideas aggregator eg Lastminute.com Destination portals Specialist tour operators Niche

  15. Channel shifts 2004-2007 Mass market Seller focus Tour operator owned travel agent Lates specialist eg Teletext, Cheapflights, Bargainholidays TV travel channel Independent high street travel agent Direct supplier sites eg Holiday-inn, easyjet, BA.com General online travel agent eg Expedia, Opodo, Travelocity, ebookers High Low Shopper confidence Ideas aggregator eg Lastminute.com Destination portals Specialist tour operators Niche

  16. Leisure travel channels ecosystem - 2008 Mass market Seller focus Teletext, Cheapflights, Bargainholidays TV travel channel Independent high street travel agent Tour operator owned travel agent Direct supplier sites eg Holiday-inn, easyjet, BA.com General online travel agent eg Expedia, Opodo, Travelocity, ebookers High Low Shopper confidence Ideas aggregator eg Lastminute.com Destination portals Specialist tour operators Niche

  17. Conclusions • Take the customers’ perspective • Segment the online opportunities • Work on guided selling, rather than taking orders • Mine the web/search activity data as hard as you can

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