A new breed of successful and trusted independent travel agents could be created by the current downturn, according to TW Group publishing director Simon Ferguson.
Ferguson, speaking at the opening session of this year’s Advantage conference in Sitges, Spain, revealed results of a state of the nation survey that showed luxury, cruise and other specialist products are future areas for growth in the trade. Of leisure agents surveyed, 55% expected luxury business to grow in the next five years, 46% thought cruise would grow, and 44% said experience holidays. Meanwhile, the state of the economy was overwhelmingly deemed the most important factor to influence the sector in the next three to five years.
He said: “Few people would bet on the economy getting any better. Many people will go by the wayside – downturns tend to weed out any unprofitable business models and favours those that offer value. Maybe this downturn will lead to suppliers becoming more reliant on intermediaries that add value.
“Customers are going to have to make difficult decisions. We know a lot of capacity is coming out of the market, but will customers pay more [for their holidays]?”
Knowledge, service, and trust will be key for agents to survive the current downturn, he said. “Invest in these and people will pay you. Trust is a massive issue; who would have thought a year ago that the industry’s third biggest player would leave 85,000 people stranded overseas? Customer perception about who they can trust will be shot through. Who’s going to deliver these types of service and provide that trust?”
Historically, downturns have led to the creation of the vertically integrated model and the growth of the internet. “It may well be that this downturn leads to the 21st century model for travel agents who offer true value. The best way to make that happen is to invest in it.”
The survey, which was completed by around 500 leisure and business members and fully completed by 300 agents, also showed over half believe their staff are very technologically savvy (52%) while 84% believe customers are carrying out a little or a lot more background research, much of it online. “It’s important we [the trade] keep ahead of the curve,” added Ferguson.
Of those surveyed, 27% were director or manager level, 16% were managing director or chief executive, and 16% were branch managers.
