IT is little more than six months since 333 Advantage travel agents opted to join a controversial franchise agreement with Airtours.
Since then, Advantage management have used the negotiating muscle of Going Places to seek improved commercial deals with operators.
With renegotiations largely complete – 5% of deals have yet to be finalised with commission levels rising by just over two percentage points – Advantage and Airtours are concentrating on providing benefits for the franchise members.
At a conference in London last week, 160 franchisees were given an outline of what they can expect from the alliance.
Advantage managing director Ron Muir said members have already benefited by £1m from Airtours as a result of increased commissions.
“This has flowed through to franchise agents and non-franchised members,” said Muir. “Payment is based on turnover and non-franchised agents are selling Airtours so they too get some of the money.”
Some of the enhanced commission is flowing into a central fund which has been used to develop a marketing campaign. Advantage refused to reveal exactly how much has been generated but said the budget is a multi-million pound one.
Commercial manager Neil Armorgie said the first aim will be to build recognition for the Advantage brand.
“There was little point launching any marketing until the shop fascias were erected,” said Armorgie.
“All but six are now up so we can begin marketing the brand.”
Other marketing initiatives include a new electronic lates board which is updated continuously during the day.
An in-store system – WebtoWindow – will also be introduced, letting customers search for holidays.
“The system will trawl through all our preferred operators and bring up a selection of choices.”
Armorgie believes the system could even supercede the MatchMaker technology which was going to be adapted for independents. But only 100 agents have shown interest, making adaption costly.
“Matchmaker was a sales tool and we have now got this in the shape of WebtoWindow,” said Armorgie.
While Advantage emphasises that choice and independence have not been sacrificed, Airtours wants to reap the benefit of its investment.
Franchise development director Andrew Williams said:”We don’t have targets but do have key performance indicators. It is like any commercial agreement, the operator is looking for maximum return on investment.” Williams declined to reveal the target figure.
Industry observers estimate that Advantage accounts for only 1%-2% of Airtours’ business.
“They will be looking to increase that to between 7% and 10%,” one source said.
Advantage said members will be encouraged to sell Airtours products but admitted it will take time to develop a relationship with its mainstream Holidays product.
“Traditionally we have had a good relationship with Cresta and Bridge but only now are we building a relationship with Airtours Holidays,” said Muir. “They are still learning about us and we about them.”