Travel companies have been warned to prepare for even more change in the next two years and need to pay more attention to customer behaviour to survive.
Speaking at the New Faces panel debate on the first day of the Institute of Travel and Tourism’s conference, Stella Travel Services chief executive Keith Stanley said future change, including the growth of new markets, the global economy, the rising cost of fuel and consolidation, could seal the fate of many companies.
On the global economic impact, including the fuel crisis, companies need to better manage their cash flow. “A lot of operators will go under if they do not stick to the fundamentals of business. We are only just starting to see the impact,” he warned. “Be aware of the next two years, there will be more change than we have seen in the last two years.”
Future changes will also include rapid growth in outbound travel markets such as China – for the first time in 2009 China’s outbound travel market will exceed that of Germany’s. Tourist destinations will need investment to be prepared for this explosion in holidaymakers, he added.
The changes will increase pressure on the industry to pay more attention to customers’ travel needs. “Customers today are not the customers they were even three to five years ago; they are a lot more informed and discerning,” he said. “Customers are sometimes better qualified to make recommendations than we (travel agents) are and this change in customer behaviour is what’s changing the industry.”
The industry’s future will no longer be solely led by airlines developing new routes because of changes in consumer behaviour, he added.
Recent research undertaken by the Stella group shows customers behave in different ways in different situations. “What we [as an industry] have not been doing is becoming more clearly aware of what customers are looking for – that’s a challenge for us and really we need to perform,” he said.