FTO takes direct approach inbid to survive the Internet age

Analysis

FTO takes direct approach inbid to survive the Internet age

The Federation of Tour Operators is highlighting the threat of the Internet, digital television and tourism taxes on its membership. Jane Archer reports

MORE than 50% of all holidays booked in the UK are being put together independently by holidaymakers who are bypassing operators and agents.

That is a worrying enough statistic for operators or retail agents but things are going to get worse once national tourist offices get smarter with their Web sites, warns Federation of Tour Operators chairman Martin Brackenbury.

His argument is simple – many national tourists office sites are currently not very good but that situation will change. When that happens, national tourist offices will want to expand from just being information services to providing links to hotels or car-rental companies, for instance, so people can book direct. The result will be a double whammy.

Operators and hotels, which have been mutually reliant, will lose business, while clients could find the operator “cushion” they have previously relied on, pulled from under them.

“Hotels are used to getting bulk bookings from operators – if they go the independent route, their bookings will go askew,” said Brackenbury.

“It is not commercially sensible because they rely heavily on operators.

“The figures should speak for themselves but there is a trend towards direct booking. In the end, hotels and tourist offices will do as they wish.”

Brackenbury admits there is no easy solution. “What is important is that the FTO makes sure that suppliers understand where we are coming from.”

He is also concerned about making sure that customers are protected from the march of technology.

“People might feel comfortable choosing and booking a hotel direct in Spain knowing that it has not been checked out by a tour operator but that might not be the case if they are travelling further afield,” he pointed out.

Brackenbury believes that helping members to survive the impact of the Internet and digital television is one of the major issues facing the FTO. The other is to try to convince governments not to use taxation to control tourist numbers.

FTO figures show international arrivals currently at around 650 million and that is expected to rise to 1.6 billion by 2020.

Domestic tourism is estimated to be up to 10 times that figure – there are 170 million domestic tourists in India alone – which puts huge strain on infrastructure, especially in so-called honey pot areas such as beaches and top attractions.

“We are seeing governments turn to taxation as a solution in countries where tourism has grown up, where there is congestion and pressure on the infrastructure, and where the authorities are saying that tourism has to pay its way,” said Brackenbury.

“We see it in the UK, where there is a feeling that tourists should pay more taxes.

“The FTO understands the problem but any form of tax needs to be balanced. If it starts to affect numbers, it becomes a real issue for our members.”

Those members represent about 90% of all tour operator volumes in the UK. In number, 100,000 FTO member customers fly from and arrive back to the UK each day.

Brackenbury points to Majorca to illustrate the tax problem. It wants to introduce an eco tax on tourists staying in hotels to prevent a repeat of the congestion the resort suffered last year.

A tax of around £7 has been quoted but it is unclear if it will be per person, per room or even per day.

Brackenbury said the FTO opposes the eco tax because it will apply to hotel guests only and is therefore unequitable. “If they are going to do it, it should be on all tourists,” he said.

Digital dilemma: Brackenbury wants consumers to be protected from the onslaught of technology

Middle East crisis

THE Federation of Tour Operators has watched one year of work to encourage peace tourism in the Middle East literally go up in smoke as violence between Palestinians and Israelis broke out last month.

Chairman Martin Brackenbury said: “One of our roles is to try to show countries that they can increase the size of the tourism pie if they work together.”

“It is terribly sad to see the current situation because a key way of creating income for the Palestinians is through tourism.”

While ABTA is concerned about regulatory issues affecting agents and tour operators, Brackenbury said the FTO’s role is to focus on making sure that destinations provide safe and secure holidays for members’ clients.

“The FTO is at least as relevant now as it was in the past but the issues have changed,” he added. “In the past we were fighting for customers to be able to take seat-only flights to Spain, for example. Today, health and safety and hygiene issues are very important.

“For instance, one of the issues we are pushing for is a European fire safety directive so all member states adhere to the same standards. At the moment, there are only recommendations and they only apply to hotels.”